Chapter 7 Bankruptcy
Chapter 7 Bankruptcy is what most people think of when they hear about filing for bankruptcy. It is known as a fresh start since most unsecured debts are eliminated through discharge and most of a consumer's assets are exempt from having to be sold for the benefit of creditors.
Common reasons for filing Chapter 7 Bankruptcy include:
Filing for bankruptcy is a complicated process. Only about half of bankruptcy filers qualify for Chapter 7, you must pass something calls a Means Test. The Means Test is an assessment of you financial situation and it is compared to the median income in Maryland. If you are under the mean, you may qualify for Chapter 7. And even if you are over, there are a few circumstances where you still may qualify.
Bankruptcy is a federal law, but it is also affected by state laws. There may be issues specific to Maryland when deciding how to approach your Bankruptcy filing. The Law Office of Marc Kivitz will carefully review all of your financial details and make a recommendation to you, and work along with you every step of the way.
Chapter 13 Bankruptcy
Chapter 13 is a very good choice for may people especially if a person has income. It is a solution for those who may have gotten in over their head with credit card debt. It also is a way to protect property that you may not want to lose.
Chapter 13 is a repayment plan that can spread payments to creditors over a long period of time, 3-5 years. With your attorney's assistance, the principal of the debt or the interest amount may be renegotiated.
There are abundant ads for debt consolidation companies who will tell you that it is better to pay them a commission and you get to repay your creditors without having to file bankruptcy. There may be more drawbacks with them method and some advantages to actually filing a Chapter 13. Overall, the costs of Bankruptcy is generally less than using a commissioned company. There is Court oversight of your repayment plan. And under debt consolidation plans, a 1099-C may be issued for any debt that is cancelled, making that debt taxable income. When a Chapter 13 is filed, and the plan for prepayment is confirmed, there are no tax consequences for any debts that are forgiven.
The Law offices of Marc R. Kivitz is a debt relieve agency assisting people in Maryland filing for bankruptcy relief under the Bankruptcy Code. All information presented is for informational purposes only and not considered legal advice
Chapter 11 Bankruptcy
Chapter 11 bankruptcy is the form of bankruptcy most often used for businesses, partnerships, and corporations. It is also available to high income earners. In a Chapter 11 there is no limit on the amount of debt which does happen in a Chapter 13.
The debtor remains in possession of their assets and operates the business under the supervision of the Bankruptcy Court. The debtor usually remains in possession of its assets, and operates the business under the supervision of the court and for the benefit of creditors. You and your attorney will propose a financial plan to restructure your debt. The plan may also propose canceling certain obligations .
A creditors committee is usually appointed by the US Trustee. The committee represents all of the creditors in the bankruptcy proceedings and and can negotiate an acceptable plan of reorganization. A Chapter 11 plan is confirmed only when there are is vote and agreement of the creditors.