If you are struggling with debts and are unable to pay off your creditors, bankruptcy might be a great way out. However, you might need to gather information about the same, since people are generally unaware about it. You will be surprised, say lawyers of Los Angeles based bankruptcy law firm Recovery Law Group to find that federal government informs you of necessary bankruptcy related information on its official website USCourts.gov. however, it is always important to hire experienced bankruptcy lawyers if you wish to get rid of your debts through bankruptcy. Though all information related to bankruptcy is available on official website, only lawyers can provide you a successful discharge. Call 888-297-6023 to discuss your case with experienced bankruptcy lawyers and get all your debts discharged.
The bankruptcy code passed by Congress in 1978 provides knowledge of all laws which are used to govern bankruptcy cases. The Federal Rules of Bankruptcy Procedure are a set of procedural standards which are followed by all local district bankruptcy courts wherever bankruptcy proceedings take place. Bankruptcy case is presided over by a federal bankruptcy judge, however, debtors are required to appear in the court just once. This takes place to determine whether debtor is eligible for bankruptcy filing, whether debts can be discharged during bankruptcy, etc.
The bankruptcy code provides details of various bankruptcy chapters:
- Chapter 7 – is also known as liquidation bankruptcy. All assets and property of debtor are taken over by bankruptcy trustee. Debtor can protect some assets through exemptions. Non-exempt property is sold off by trustee to repay creditors. The creditors are paid according to their status (secured, unsecured priority and then unsecured nonpriority debts).
- Chapter 9 – is used by municipalities like towns and cities to reorganise their debts. This is equivalent to a government chapter 11.
- Chapter 11 – is used by individuals and businesses to pay creditors without having to close their business. It is done with a court-approved reorganisation plan which ensures creditors get their dues with the business remaining operational.
- Chapter 12 – is used by fishermen and farmers to get rid of their debts through a reorganisation plan.
- Chapter 13 – reorganisation plan for people of other occupation. Both these chapters (12 and 13) ask debtors to repay their debts through 3-5 years repayment plan. They can keep their non-exempt property too if the creditors are paid their due.
- Chapter 15 – chapter is for dealing with property that a debtor owns in a foreign country. Generally, such cases are referred as “cross-border cases.”
Having a bankruptcy lawyer by your side can be an asset, irrespective of which chapter of bankruptcy you file. They can tell you the best way to protect most of your assets while getting majority of debts discharged.