What is Bankruptcy?

Bankruptcy is a process that allows individuals and businesses to escape from overwhelming debt. It allows you to discharge the debt you owe to your creditors and start over fresh. There are several chapters you can file, which type will be best for you and your family. If you are considering filing for bankruptcy in Miami, you should consult Miami bankruptcy attorneys who can give you advice on your options. There are several different types of bankruptcy; it depends on your situation. If you think that bankruptcy is a good option for you, you should contact a lawyer who can help you. Here is some basic information to help you.

Chapter 7 Miami bankruptcy is a liquidation bankruptcy. In this type of bankruptcy, any available assets will be sold and the money raised will be applied to your debts. Any remaining debt will be discharged, which means you will no longer be responsible for paying them. Not all of your belongings will be taken; you will be eligible to keep your household items such as furniture, clothing and appliances. If you own tools that you require you to keep working, those items will also be protected. Your car may also be protected from liquidation. Contact a bankruptcy lawyer to find out what the bankruptcy laws in your state are regarding what items are exempt from liquidation. If you have lost your job and are overwhelmed by credit card debts or medical bills, Chapter 7 might be a good option for you.

Chapter 13 bankruptcy is a restructuring bankruptcy. If you are still employed but are struggling to make your payments on time, Chapter 13 might be a good option. In this type of bankruptcy you will be able to keep all of your assets and you will make affordable monthly payments. Chapter 13 is a very complicated type of bankruptcy that involves negotiating with your debtors, who can block you from filing or even force you into Chapter 7 liquidation bankruptcy. It is important that you have representation in Chapter 13 to get the best deal possible. Since you repay some of your debt, this type of bankruptcy is less damaging to your credit score. This type of bankruptcy may also allow you to catch up on back mortgage payments and keep your home.

Filing for bankruptcy is a very difficult and complicated process that will have long term consequences on your financial situation. Your credit score will drop, you will have difficulties borrowing money and new employers may not want to hire you with a bankruptcy on your record.