Bankruptcy Options

Bankruptcy Attorneys in Monmouth County

Decorative Scales of JusticeChoosing between Chapter 7 Bankruptcy and Chapter 13 Bankruptcy

Though you may be in a dire financial situation, choosing between Chapter 7 and Chapter 13 bankruptcy can mean a world of difference to you. Bankruptcy functions to relieve a person of overwhelming debts. Bankruptcy is not a punishment or saved for the financially irresponsible. Many fiscally responsible people have to file for bankruptcy because of overwhelming debts not stemming from reckless behavior. For example, medical bills and the financial burden of divorce are just some of the many ways a responsible person can find themselves facing a bleak future. Bankruptcy provides the means to get back on track and start building credit once again. According to the bankruptcy code, there are two chapters in which an individual can work to satisfy hostile debtors. One is Chapter 7 bankruptcy and the other is Chapter 13 bankruptcy. Each form of bankruptcy has its merits. If you need quality legal support deciding between Chapter 7 and 13, contact Tomes & Hanratty, P.C. for a consultation. Our firm is ready to guide you through your legal options and the process of filing for bankruptcy.

Comparing Chapter 7 and Chapter 13

Though both chapters function to free you of most debts, they do it in different ways. Chapter 7 is a liquidation of all non-exempt assets to pay creditors as much of the debt as possible. When the process is completed, most of the debts that have burdened you will be discharged and you get a fresh start. Chapter 13 is quite different. The Chapter 13 process is a repayment plan. Chapter 13 allows you to keep your possessions while you and the creditors work to establish a repayment plan that is practical and satisfies the bankruptcy court.

Some debts are nondischargeable, meaning they cannot be forgiven. Some of the debts that are not forgiven include student loans, child support, alimony, some taxes, debts in bad faith and other debts not on the petition. In addition, bankruptcy does not waive the rights of secured creditors. For example, if you owe money on your house or car, you will have to pay these debts or return the property in question. If you need help choosing between these two options, contact Tomes & Hanratty, P.C.

Contact the New Jersey Bankruptcy Law Firm of Tomes & Hanratty, P.C.

The attorneys at Tomes & Hanratty, P.C. understand the emotional turmoil of filing for bankruptcy. Bankruptcy has unfounded stigmas that often scare individuals, making their already serious financial situation worse. Bankruptcy simply provides you the legal means to right your financial ship and get back on course. Choosing the right bankruptcy option for your situation is very important. With the right legal guidance, you can make an educated decision that best suits your circumstances. If you need a law firm that has your best interests in mind and knows the best course of action, contact Tomes & Hanratty, P.C. for a free initial consultation.