Donald Appignani - Attorney at Law
Compassionate
| Competent | Professional
Bankruptcy, Debt-Relief, and Foreclosure
Assistance
Bankruptcy:
People who are having trouble paying their debts sometimes consider
bankruptcy as a remedy for this situation.
Bankruptcy is the process by which consumers and
businesses can resolve debt, stop foreclosure, repossession, and
lawsuits. Filing bankruptcy may clear debt, stop creditor harassment,
and provide additional time to repay bills. An individual, called a
debtor, usually files bankruptcy to get rid out his or her debts so that
they will not have to be paid. Once the bankruptcy begins, creditors
cannot contact or try to collect debts from the debtor, or sue the
debtor to obtain a judgment. With a few exceptions, the creditors have
no claim on the debtor's future income or future assets.
There are two main forms of personal bankruptcy: Chapter 7 bankruptcy
and Chapter 13 bankruptcy.
Chapter 7 Bankruptcy: The Debt Discharge Chapter 7, the most common form of bankruptcy,
is typically filed in a federal court when an individual or business
facing a great deal of debt is unable to pay it.
A successful Chapter 7 bankruptcy results in the Chapter 7 debt
discharge, which eliminates the filer’s unsecured debt, such as:
● credit card debt
● payday loans
● personal loans
● utility and medical bills
Keep in mind, a person must prove eligibility to file
Chapter 7 bankruptcy based on recent income and the number of persons in
their household.
Chapter 13 Bankruptcy: The Wage Earner’s
Repayment Plan Chapter 13 bankruptcy, also known as the wage
earner’s plan, is often an option suitable for those facing foreclosure
or looking to reorganize finances within the confines of a
court-approved, debt repayment plan.
Supervised by a federal court, Chapter 13 bankruptcy
gives some income-receiving debtors the ability to:
● stop foreclosure
● silence creditors
● get on a more realistic, interest-free debt repayment plan
● possibly receive a discharge from unsecured debts
At the beginning of the Chapter 13 repayment period,
which normally lasts three to five years, a court-appointed trustee is
assigned to an individual case and thereupon acts as the go-between for
the debtor and creditors.
The trustee receives a set monthly payment from the
debtor to give back to creditors regularly or as specified in the
court-ordered plan.
At the completion of the plan, debts are usually
discharged, or legally forgiven.
The Discharge:
Once the discharge is entered by the court, the debtor is no longer
legally liable to pay a debt that was discharged and no creditor who had
notice of the bankruptcy can attempt to collect the debt unless it is
categorized as “non-dischargeable”, examples being some forms of
criminal restitution, domestic support or student loans still not paid
in full.
With every year that passes after filing bankruptcy, its record on a
credit report is typically viewed with less scrutiny. In some cases, the
debtor can acquire a decent credit score within 2-3 years of receiving
the discharge.
Alternatives to Bankruptcy: Bankruptcy is not the only method of dealing
with your debt. In some situations another way might be more
advantageous to the debtor than filing bankruptcy. Such alternatives may
include negotiating with your creditors to lower payments, thus avoiding
potential lawsuits, attaining help from a consumer credit counseling
service, or payment of debts by sale of assets or borrowing on assets.
However, these methods require some cooperation from creditors, and the
chances of success are greater if the debtor attempts these alternatives
soon after financial difficulties begin.
You should seek the advice of a competent bankruptcy attorney before
deciding whether to file for bankruptcy. Call our office to schedule a
free consultation directly with Attorney Donald Appignani, so he can
explain the process in further detail to see if bankruptcy is right the
thing for you.
We are a debt relief agency. We help people file
for bankruptcy relief under the Bankruptcy Code.
