It is never easy for anyone to file for bankruptcy. For many people, it is a wrenching choice—continue to be harassed over debts you cannot pay, or declare bankruptcy and get a fresh start, albeit with a mark on your credit.
Bankruptcy is sometimes the best choice, although debt management alternatives are often available. Our Madison bankruptcy lawyer can review your situation and discuss the most viable path for you.
The experienced and professional lawyers at Gillman, Bruton & Capone have more than 25 years’ experience helping individuals and businesses through bankruptcy. We emphasize strong communication with our clients and are available at all times to answer your questions.
Bankruptcy does not mean you just walk away from your debts while your creditors get nothing. Most forms of bankruptcy require partial payments to creditors, and some may require you to sell assets to satisfy your debt.
One of the main benefits of a bankruptcy filing is that it prevents creditors from contacting you directly. Instead, creditors must go through your attorney. Harassing calls and letters will stop as soon as you file for bankruptcy. The second benefit of bankruptcy is it allows a fresh start: once you have fulfilled the obligations the bankruptcy court imposes, the remaining debt is discharged. Bankruptcy provides space to regroup, reorganize, and start over.
Bankruptcy could affect your credit score for a decade, which is a long time to cope with difficulty getting credit. It is always worth exploring non-bankruptcy alternatives with a Madison bankruptcy attorney. However, the longer you wait, the more complicated your situation might become.
Chapter 7 is often called liquidation bankruptcy. Under this form of bankruptcy, a person must liquidate many of their assets to satisfy creditors. However, we do our best to allow our clients to keep their assets and look for alternatives to liquidation. In many cases, you could keep your home, car, and most personal belongings. Consulting our bankruptcy attorney is critical to determine what property might be exempt from sale in your case. Chapter 7 bankruptcy only applies to those who fall below a certain income threshold.
Chapter 13 bankruptcy allows a person to keep their property, but they still must repay their debts. The advantage is that Chapter 13 restructures debt so that the debtor’s monthly payments are more manageable, and it can also pause a home repossession or foreclosure while your bankruptcy case is active.
Someone who files for Chapter 13 bankruptcy must fully repay their “priority debts” over three or five years. Priority debts include child support, spousal support, and recent tax debt. If you are a business owner in bankruptcy (which often means filing for Chapter 11 bankruptcy) and owe employee wages, the wages are also priority debts. If you own your home and want to keep it, you must catch up on any mortgage payments in your plan of reorganization. You will continue to owe mortgage payments once you emerge from bankruptcy.
Someone who files for Chapter 13 bankruptcy must still pay something towards their unsecured, non-priority debts, but does not need to cover all of it. At the end of the repayment period, credit card balances, payday loans, utilities, and other debts might be discharged. One of our Madison bankruptcy attorneys can explain how much debt you might be able to discharge.
Bankruptcy is not easy, but it is often preferable to managing a mountain of debt. Many people take the opportunity to stop interest from accumulating and possibly discharge some of what they owe.
Our Madison bankruptcy lawyer can work with you to identify the best way of managing your debt. If bankruptcy becomes necessary, they can explain all of the options available to you and decide on a plan that leaves you in the best position. Let us guide you through bankruptcy: schedule a free case evaluation today.