Personal bankruptcy is a legal option to use when someone is unable to pay their bills on a regular basis. There are many reasons why an individual’s bills have gotten out of hand. Divorce, death, loss of a job, illness and many other reasons can cause financial strain.
A bankruptcy lawyer in Lawrence, KS will never judge an person for the reason they need to file bankruptcy. Their focus is always on their client and helping them choose the best type of bankruptcy to meet their needs. Chapter 7 and chapter 13 bankruptcy are two types of protection through the U.S. Bankruptcy Code to help with financial distress.
Chapter 7 Bankruptcy
This type of bankruptcy is sometimes referred to as a fresh start or liquidation because any remaining assets must be sold to repay the creditors. It is considered a fresh start because after the bankruptcy is discharged, there are no repayments that need to be made. Many exemptions can be used such as:
- Farmland (up to 160 acres)
- A one-acre lot in a city
- A manufactured or mobile home the filer is living in
- Up to 75% of disposable income
- One motor vehicle up to $20,000. If the individual is disabled, it may exceed $20,000
- Any furnishings, food, fuel, equipment or clothing that is necessary for a year
- Burial plot
- Jewelry worth $1,000
- $7,500 worth of documents furniture, tools, equipment, books, seed grain, and livestock
- Exemptions can protect assets a chapter 7 filer owns. A trustee will sell any other items that are not exempt
If an individual is not eligible to file for chapter 7 bankruptcy, a bankruptcy lawyer in Lawrence, KS will discuss their option of filing chapter 13. Chapter 13 bankruptcy allows an individual to retain some of their assets and will restructure their debt. This type of bankruptcy provides an individual with breathing room to catch up on their debt and stop foreclosure on their home.
If you have questions about bankruptcy and eliminating your overwhelming debt, give Business Name a call. His experience with bankruptcy will be invaluable to you making the right decisions.