Bankruptcy Attorneys in Greater Danbury
Although no one plans to file a bankruptcy case, there are many situations such as job loss, illness, injury or business failure that might put you in this predicament. At this time, you must be financially responsible and take action the correct way. Most creditors and banks will encourage debt financing through low interest rates and subprime mortgages.
By filing bankruptcy, you are given a fresh start and opportunity to retain your financial security. In order to help homeowners and businesses gain control over their financial situation, we help clients with declaring: chapter 7 and chapter 11 bankruptcy.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy s is the most common form of bankruptcy in the United States, mostly due to the process being more affordable and quicker to file. It’s often regarded as “liquidation bankruptcy” because it helps most individuals and businesses eliminate debt. By filing Chapter 7 bankruptcy you could potentially eliminate medical bills, credit card bills and other unsecured debt and get a fresh financial start.
You can do this all while retaining ownership of your home and car. This is made possible because each state has a list of exemptions of what property you are allowed to protect. The federal system and most states may let you keep:
- An amount of equity in your home
- Personal property such as retirement accounts
- Portion of wages
- Household goods or clothing
Although exemptions are made available, you still have to pay the lenders of property, such as car loans and a house mortgage. Before filing bankruptcy in Chapter 7, you must be up to date with monthly payments if you plan on keeping your house or car.
In order to qualify for Chapter 7 bankruptcy, you must either have a business with significant debt, or have a household size that falls below the state median income. You can also take the bankruptcy “mean test” to determine if your household gross income is too high. Once we determine if you are eligible for Chapter 7, you will need to provide us with sufficient information on your assets and debts in order to determine which exemptions you qualify for.
Chapter 11 Bankruptcy
Chapter 11 bankruptcy is the form of bankruptcy created for the purpose of reorganizing a business with heavy debt. It’s mostly intended for corporations but can also be available for small businesses. After being approved by the court, the business can redevelop its operations and create a plan to pay a fraction of the debts and dismiss others.
The plan can include:
- Reducing costs where necessary
- Finding new sources for revenue or income
- Renegotiate or partially pay leases or contracts with debt
If all goes well and the plan is accepted, the business can avoid the use of liquidation in order to pay back creditors. A plan can be developed that entails adjusting operations to become profitable, ending stressful contracts and leases, and selling useless assets.
Where Can You Seek Help for Bankruptcy?
Depending on the type of bankruptcy you are seeking, a bankruptcy lawyer will be able to evaluate your current situation and recommend which type you should file and how to go about the process. Depending on what type you file, the results may vary. You could be lowering, erasing or reorganizing your debt.
To receive advice for filing bankruptcy, reach out to us at Romanello Law Firm.