Bankruptcy Overview

It’s not uncommon nowadays for people to fall behind on their bills, expenses, and financial obligations. All it takes is one unpredicted job loss, one unexpected illness with high medical bills, or one sudden family emergency for a person in an otherwise excellent financial position to suddenly find themselves over their head with too much debt. For people with this type of mounting, inescapable amount of debt, bankruptcy provides the relief they need to get a handle on their finances and become financially stable once again.

What is bankruptcy?

Bankruptcy is the legal process of alleviating individuals and businesses of their debt, either through liquidation or reorganization. For individuals and families, there are two main types of bankruptcy: Chapter 7 bankruptcy and Chapter 13 bankruptcy.

Chapter 7 bankruptcy , also referred to as liquidation, completely eliminates all of debtor’s legal liability to pay unsecured debt, such as outstanding credit card debt, medical bills, unsecured personal loans, payday loans, judgments, etc. In return for eliminating the majority of your debt, some of the individual's non-exempt property or possessions may be sold in order to help off-set some of their debt. It should be noted that Chapter 7 bankruptcy does not erase all of one's debt. Certain debt cannot be eliminated in Chapter 7 bankruptcy, such as child support, alimony/spousal support, student loans, damages for personal injury accidents, tax debt, etc.

Chapter 13 bankruptcy , also referred to as reorganization, consolidates a debtor’s debt and restructures it into an affordable monthly payment plan. Unlike Chapter 7 bankruptcy, Chapter 13 does not completely eliminate a debtor’s unsecured debt. Under Chapter 13 bankruptcy, the debtor is still required to repay a portion of or all of his or her debt. However, the debt will be repaid in affordable monthly payments over a period of three to five years. The amount paid every month will be determined by the court and in relation to monthly income, current monthly expenses, and non exempt assets, this way a debtor is not required to pay back more than he or she can afford each month. Furthermore, debtors are usually able to keep all of their assets and property throughout the bankruptcy process.

Many people who file for bankruptcy wrongly believe that their credit is permanently damaged. This is simply not true. There are several steps you can take to rebuild your credit and good financial standing. The best thing you can do is open a line of credit or obtain a small bank loan. Once you have a line of credit or a loan in your name, you can improve your credit by making all monthly payments on time and in full if possible. You should also try to pay your bills early and pay more than the minimum payment amount.

Contact a Chicago Bankruptcy Lawyer

It’s important for any person filing for bankruptcy to work with a skilled attorney who understands the complex bankruptcy laws and court systems, as well as your personal financial situation. With years of experience practicing bankruptcy law in Chicago, I am very knowledgeable about the the bankruptcy process, and can provide you with the professional legal counsel and guidance you need to successfully file for bankruptcy. I can review your petition, discuss your situation in depth, and answer any questions or concerns you may have in order to help you make the best decision possible concerning your financial burden. My priorities are helping you get back on your feet financially and alleviating the debt and financial burdens that are weighing you down.

To speak directly, one on one, with an experienced and knowledgeable Chicago bankruptcy lawyer at my firm, please contact the Law Office of Marc Wagman at (312) 489-8182. I have helped thousands of hardworking individuals and families obtain the financial relief they desperately need through Chapter 7 and Chapter 13 bankruptcy.