For many individuals, bankruptcy is a taboo term, synonymous with bad decisions and irresponsibility. However, the attorneys at Achille, Ellermeyer, Wallisch & Sobol Attorneys At Law understand even the most financially savvy individual can acquire significant debt after an unexpected change in circumstances. If you’re struggling to pay your bills, it may be time to file for Chapter 7 or Chapter 13 bankruptcy, and the lawyers at this Brookville PA, firm will explain your options and help you pursue them.
Is Bankruptcy Right For You?
To determine whether filing for Chapter 7 (liquidation) or Chapter 13 (debt reorganization) bankruptcy is your best move, consider your overall financial situation. Answer the following questions to assess the degree of your financial crisis:
- Are you making only the minimum credit card payments?
- Do collectors frequently try to contact you?
- Do you ignore your finances or avoid sorting them out?
- Do you often use credit cards instead of cash?
- Have you considered debt consolidation?
- Are you unsure of how much you owe?
If you answered yes to two or more of these questions, take a thorough look at your finances and determine whether you can afford to repay your debt. Take an inventory of your liquid assets, including retirement funds, savings accounts, and personal property. Add the values of your assets and compare the total to the amount you owe. If your total debt is greater than your liquid assets, bankruptcy may be a reasonable option.
How To Declare Bankruptcy
There are two ways bankruptcy typically is filed: voluntarily by the individual and by court order at the request of creditors. Either way, you then have several decisions to make about your bankruptcy case.
Chapter 7 bankruptcy often is favored because it essentially eliminates your debt. However, your assets will be liquidated and the cash will be used to pay off as much of your debt as possible. Within four months of declaring bankruptcy, you will receive a notice of discharge that clears your name of all debt.
Chapter 13 bankruptcy lets you keep your assets and instead reorganizes your debt into smaller payments made over a period of 3–5 years. Chapter 13 bankruptcy is a good choice for people who do not qualify for Chapter 7 bankruptcy or do not want to liquidate their assets to pay off their debt.
Achille, Ellermeyer, Wallisch & Sobol Attorneys At Law will help you determine if bankruptcy is your best option. To discuss your situation with a knowledgeable bankruptcy lawyer, call (814) 849-6701. Visit their website for more information about their attorneys and services.