Debt can place a significant strain on families and businesses. Not only can this debt come with financial pressures from creditors, but it may also inflict harsh emotional traumas and feelings of uncertainty about the future. Individuals, couples, and businesses facing these debts have the option of pursuing bankruptcy, which can bring relief in the form of an automatic stay on collection efforts. In addition, completing a bankruptcy could result in the discharge of many forms of debt.

That being said, it is vital to consider whether filing for bankruptcy is the right choice for you. This involves performing a full financial analysis and exploring the different plans available under federal bankruptcy law. A Spring Lake Heights bankruptcy lawyer is here to provide guidance. Our lawyers help people and businesses explore every possible option, explain the different bankruptcy plans, and guide you through bankruptcy every step of the way.

Immediate and Long-Term Benefits of Filing for Bankruptcy

Filing a bankruptcy petition can provide immediate relief in an emergency. This is because courts that receive bankruptcy petition must impose an automatic stay on all collection efforts. A stay affects all current efforts by creditors to collect on a debt, even if that effort is currently active as a lawsuit. In addition, this stay applies to all future collections while under the protection of the bankruptcy court

The goal of any bankruptcy case is to obtain a discharge of your debts. For individuals and couples, this can often include mortgage payments, car debt, medical bills, and credit card payments. Businesses face many of the same debts but may also have concerns about vendor payments and overdue fees.

Successfully completing a Chapter 13 bankruptcy plan, for example, will discharge these debts in their entirety. However, it is important to realize that not every debt is eligible for discharge. Common examples of non-dischargeable debts include student loan payments and tax debts to government entities. Consulting with a Spring Lake Heights bankruptcy attorney can help you better understand the concept of bankruptcy and how it could provide for a more stable financial future.

Primary Types of Bankruptcy

Depending upon a number of factors, the law offers people and companies various options for seeking bankruptcy protection in places like Spring Lake Heights. A debtor’s current level of debt, their status as a person or company, and even their amount of debt can all play a role in choosing the proper chapter of bankruptcy.

Chapter 7

Chapter 7 is the most common form of bankruptcy and is available to both individuals and businesses. There is no maximum debt limit to utilize this plan. In a Chapter 7 bankruptcy, the court will potentially order the supervised sale of assets to raise cash to pay off creditors. However, even with these sales, individuals and couples can often retain their home if they convert to a Chapter 13 bankruptcy or if they decide to pay the trustee.

Chapter 11

Although certain individuals have the ability to take advantage of it, Chapter 11 bankruptcy is an option available primarily to businesses. Chapter 11 functions as a way for a business to escape out from under its debt and continue operations in the future. However, as a caveat to this protection, the business must undergo a court-supervised reorganization. This can result in the sale of assets or the hiring of new executives.

Chapter 13

A Chapter 13 bankruptcy, which usually only applies to individuals and couples, can also be filed under if you have a small business with assets that are tied into your personal finances, it may be possible to discharge a company’s debts along with personal obligations. In a Chapter 13 plan, it is possible to retain personal assets that may not otherwise be protected under a different chapter of bankruptcy. The court will order the creation of a plan of reorganization that requires monthly payments over a period of years to repay your debts. Completing this reorganization plan results in the discharge of debts.

Reach Out to a Spring Lake Heights Bankruptcy Attorney Today

If you are facing an overwhelming amount of debt, it may seem impossible to ever return to a healthy financial position. Whether this debt is the result of personal expenses, an unforeseen emergency, or difficult business conditions, it is possible to apply for relief through a bankruptcy filing. Completing a bankruptcy case could see the end of your debts and relief from all collection efforts.

Talking with an experienced bankruptcy lawyer is the first step towards a better financial future. The lawyers at Gillman, Bruton & Capone evaluate your options, explain how bankruptcy works, and submit all necessary paperwork to the courts. With an office in Spring Lake Heights, as well as others around the state, our attorneys are ready to assist you through your financial hardships. Set up a free consultation with us to get started. Our team is here for you every step of the way, including via email, text messaging, and remote appointments.