Bankruptcy 101
Chicago bankruptcy attorney - When consumers are having trouble making ends meet, the bankruptcy system could provide the assistance they’ve needed.
Chicago bankruptcy attorney - Declaring bankruptcy is a court procedure in which families can either erase their obligation to pay off some or all of their debts, or repay your debt according to a court-approved repayment plan
Chapter 7 bankruptcy allows people can either eliminate their legal obligation to pay back some or all of their debts. Chapter 7 bankruptcy is also known as a Fresh Start Bankruptcy because it releases filer’s from any personal liability for the debts that they’ve incurred. In return for the “fresh start” a bankruptcy trustee can sell a Chapter 7 filer’s assets to repay his or her creditors. Many assets are protected by bankruptcy exemptions though, and most filers don’t lose anything.
Chapter 13 is the other most common form of consumer bankruptcy and is sometimes referred to a "wage earner" bankruptcy because, in order to file for Chapter 13, you must have a reliable source of income that you can use to repay some portion of your debt.
When people file for Chapter 13 , they have to propose a repayment plan that lays out how you are going to pay back your debts over the next three to five years. The exact amount that families are required to pay depend on individual circumstances such as income, the amount of debt, and what assets would be available for liquidation to repay creditors if the filer had filed a Chapter 7 bankruptcy.