Bankruptcy is defined as the legal declaration of a debtor that he cannot pay off his outstanding debts. A debtor can be an individual, a business firm or a corporation. When a person is not in a position to avail the usual debt relief options, bankruptcy is the only way out.
The benefit of filing a bankruptcy case is that one is freed completely from the burden of his debts and the involved stress. It offers a few options that a person can choose, depending upon their situation. Here are the two most popularly preferred bankruptcy options:
Chapter 7 - This is the most common option that an individual prefers to file their case under. This allows a debtor to shed off his burden of debts completely. As a person applies for a chapter 7 bankruptcy, the court appoints a trustee who is empowered with the responsibility of evaluating the value of total assets that a debtor owns. Thereafter, the assets are liquidated and the involved creditors are paid off.
Chapter 13 - This option cannot be availed by everyone. It allows a debtor to pay his debts after a time span of 3-5 years. This implies that a debtor needs to have a proper income source so that he can pay up after the given time. Corporations and partnership businesses are not eligible to avail this option. Once a debtor applies for this chapter of bankruptcy, he needs to send in a repayment plan to the court for approval.
It is not possible for a common man to understand the implications of a bankruptcy case. He needs proper guidance and assistance to get through the whole process. A bankruptcy lawyer can be of great help in such a condition. He is the right person to provide help - right from filling up the paper-works to deciding which option his client should opt for. It is his duty to make his client feel at ease.
While looking for the right bankruptcy lawyer, you need to be sure of a few factors like amount of experience he holds, the qualifications he has and what his referrals and previous clients have to say about his service. It is important to do a little research on the background of your lawyer before hiring him rather than hiring a wrong lawyer and mess up situations further.
It is better to seek expert assistance instead of plunging into the intricacies of bankruptcy. Temecula residents can approach 4Bankruptcy for excellent and specialized lawyer to fight their cases.
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