The decision to file Bankruptcy is one of the most important financial decisions you will ever make in your life.  Therefore, this decision should be made only after a complete analysis of your financial situation.  At Alison Grant, Attorney at Law we can help guide you through this important choice.  We practice two types of Bankruptcy: 

• Chapter 7       
• Chapter 13

Bankruptcy is a federal legal proceeding whereby a person who cannot pay their bills can get a fresh financial start.  Filing Bankruptcy can immediately stop your creditors from seeking to collect debts from you until your debts are sorted out according to the law. 

Filing Bankruptcy makes it possible to:

• Discharge your debts, which means you may eliminate your legal obligation to pay most or all of your debts.  It is designed to give you a fresh financial start; and
• Stop foreclosure on your house, however, it does not eliminate the mortgage(s) or other liens.  It also allows you the opportunity to catch up on missed payments; and
• Prevents repossession of your car or other property, and may force the creditor to return property even after it has been repossessed; and
• Stop wage garnishment, debt collection harassment, or similar creditor tactics used to collect a debt.

Bankruptcy does not solve every financial problem.  Bankruptcy usually CANNOT:

• Eliminate certain rights of secured creditors.  To be secured means that the creditor placed a mortgage or other lien on the collateral property, for example car loans or home mortgages; and
• Bankruptcy does not eliminate your obligation to pay your debt if you retain the collateral; and
• Eliminate all debt since some types of debt are singled out under the Bankruptcy Code as non-dischargeable debts, these include, but are not limited to:  child support, alimony, some student loans, some taxes, and certain criminal fines; and
• Protect cosigners on your debts; and
• Discharge debts that arise after Bankruptcy has been filed.

There are four types of Bankruptcy:

• Chapter 7:  known as liquidation and requires the debtor to give up property which exceeds statutory limits known as exemptions.   The property given up is then sold to pay creditors.
• Chapter 11:  known as reorganization is normally used by businesses.
• Chapter 12:  is used by family farmers.
• Chapter 13:  known as debt adjustments and requires the debtor to file a plan to pay debts.

Since most people who file Bankruptcy file under either chapter 7 or chapter 13 we at Alison Grant, Attorney at Law focus on these types of Bankruptcies.  Either of these types may be filed individually or by married couples filing jointly. 

Like with most pleadings before the court, Bankruptcy Chapter 7 requires you to file a petition asking the court to discharge or wipe out your debts.  Under Chapter 7 Bankruptcy the debt is discharged in exchange for the debtor giving up property, except for exempt property which the law allows you to retain.  Property not exempt is sold and the proceeds from the sale are distributed to creditors.  Chapter 7 Bankruptcy does not eliminate the right of creditors to repossess the property and if you are significantly behind in your payments and want to keep the collateral it may not be the proper choice for you.

In a Chapter 13 Bankruptcy case the debtor files a plan with the court showing how they intend to repay a portion of the debts over three to five years.  Chapter 13 Bankruptcy allows the debtor to keep property provided you make the payments as described in your plan. 

Consider Chapter 13 Bankruptcy if:

• You own your home and are in danger of foreclosure; or
• Are currently behind in your debt payments but could catch up if given enough time; or
• Own non-exempt property but could afford to repay a portion of the debt from your current income if given the proper amount of time.

Chapter 13 Bankruptcy is based upon a repayment plan, therefore, you will need to make enough income to make the required payments plus pay for your necessities.

If you think you may need to file Bankruptcy and wish to speak to an attorney please download the questionnaire below to fill out and bring to your initial consultation.

• Bankruptcy Questionnaire