Bankruptcy is a federal court process designed to help consumers and businesses eliminate their debts or repay them under the protection of the bankruptcy court.
Yes. Bankruptcies can generally be described as "liquidation" (Chapter7) or "reorganization" (Chapter 13). Liquidation bankruptcy is called Chapter 7. Under Chapter 7 bankruptcy, a consumer asks the bankruptcy court to wipe out (discharge) the debts owed. Certain debts cannot be discharged. There are several types of reorganization bankruptcy (Chapter 13). Consumers with secured debts under Full Article +
In either type of bankruptcy (Chapter 7 or Chapter 13), upon the filing of the case the court issues an "automatic stay". The automatic stay prohibits virtually all creditors from taking any action to collect the debts you owe them unless the bankruptcy court lifts the stay and lets the creditor proceed with collections.
In a Chapter 7 case, you file several forms with the bankruptcy court listing income and expenses, assets, debts and property transactions. There is a filing fee, which may be waived for people who receive public assistance or live below the poverty level. A court-appointed person, known as a trustee, is assigned to oversee the Full Article +
Generally, You lose no property in Chapter 13. In Chapter 7, you select property you are eligible to keep from either a list of state exemptions or exemptions provided in the federal Bankruptcy Code.
One of the biggest worries people have when considering filing for bankruptcy is the possible loss of their home. Though there are a few situations where you may have to give up your home, keep in mind that bankruptcy is not designed to put you out of your home.