A person is declared legally bankrupt if their fiscal debts exceed the amount of money available for repayment. The same applies for companies; when a company is unable to pay off its loans, it is declared bankrupt and all operations are seized. The assets of the company are liquidated and a state administrator is hired to pay off priority loans. However, before you declare bankruptcy, there are a few important things that you need to know. For instance, most people don’t know about the legal process or the different categories of bankruptcy that are accepted in the court of law. This article briefly outlines some of these details.
Chapter 7
The Chapter 7 bankruptcy in Fall River, MA is probably the most common option available to individuals. It’s reserved for individuals, and once it goes into effect, all of your outstanding debt will be wiped out. This includes medical bills, car repossessions, credit card bills, utility bills, etc. All legal actions that are being applied against you will be stopped as well, such as foreclosures, salary garnishments, etc. However, there are strict criteria that must be met before you can file for this form of bankruptcy. It’s best to get in touch with a bankruptcy lawyer to guide you. Business Name can help you determine whether you qualify or not.
Chapter 13
The Chapter 13 bankruptcy is known to many as a repayment plan ordered by the court. Basically, the plan can stop foreclosures and will give you at least 3-5 years to catch up on the missing payments. It’s a good option for people who have fallen behind on their payments and want a little bit of respite so that they can pay off their bills.
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