subject: Is Bankruptcy The Answer For Your Problem? [print this page] The governing laws of the United States make it possible for a person to declare bankruptcy. Declaring bankruptcy is more involved than an episode of the Office portrays where Michael feeling overwhelmed and frustrated with his financial situation slowly walks to the middle of the office, raises his hands in the air and yells, "I declare bankruptcy." It is not quite that easy and the ramifications are more lasting.
There are different kinds of bankruptcy that can be file. Nine Chapters are contained in Title 11, six provide for the filing of a petition. The other three chapters provide rules for these petitions. The chapter the petition is filed under usually refers to cases of bankruptcy.
1.Liquidation (chapter 7, Title 11). A trustee is appointed who liquidates or sells all the non-exempt property of the debtor. The property is sold and assets are distributed to the creditors. This is the most common for of bankruptcy in the United States. Because each state provides that essential property not be sold, most debtors are able to keep their property.
2.Reorganization for municipalities (chapter 9, title 11). A chapter 9 is bankruptcy is not available for individual citizens it is strictly for municipalities. It is reorganization not liquidation.
3.Reorganization (chapter 11, 12, and 13 title 11). This form of bankruptcy allows debtors to retain assets and use future earnings to pay off debt. Consumer usually use chapter 7 or 13. Farmers and fishermen commonly use chapter 13. Chapter 12 is more generous to debtors than chapter 13.
4.Cross-border insolvency Chapter 15, Title 11). This is a new chapter added in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. This chapter is for cross-border insolvency between foreign companies with U.S. debt.
The laws governing bankruptcy are complex and difficult. It is best to hire a bankruptcy attorney in Portland to work out the intricacies. While most consumers file Chapter 7 bankruptcy, this may not be in your best interest. Each case is different, assets vary and future income rates differ. Know the law before acting; it might save you years of bad credit.
Try to stay out of debt. Bankruptcy in America is at an all time high with consumers amassing huge consumer debt over that past decade. When the economy falters, high debt individuals are the first to crumble. Sometimes life throws curveballs with enormous health bills, loss of job, or other unforeseen financial catastrophes. The governing laws of the Government provide for bankruptcy. Know your rights; get a qualified Bankruptcy Attorney in Portland to understand the ramifications and consequences of your choices. While you cannot stand up in the office and loudly exclaim, "I declare bankruptcy," there are people educated to help you in this process.
