Anderson Bankruptcy Attorney--Chapter 7, and 13 Bankruptcy Information

Bankruptcy is a term that had been used for a long time and today, it means being financially unable to pay one's debts as they become due or to have incurred more debts than assets. Bankruptcy is also the statutory procedure under federal law by which a debtor undergoes a judicially-supervised liquidation or reorganization for the benefit of those whom they owed money or their creditors. The debtor is usually relieved of most of his debts through what is known as a discharge herein the debtor's property becomes the bankruptcy estate. This federal law is what we recognize now as the Bankruptcy Code.

Filing bankruptcy is done in federal court, thus ensuring uniformity throughout the United States. However, there are certain variations from state to state relating to what assets an individual is allowed to keep otherwise known as exemptions, and as to the nature and extent of a debtor's property interests and other matters. It is imperative therefore that debtors should consult a local bankruptcy attorney like our Anderson bankruptcy attorney to have the best representation when filing for bankruptcy.

The vast majority of bankruptcy cases are filed voluntarily by the debtor although there are rare situations wherein creditors are permitted to file involuntary bankruptcy cases against a debtor who is generally not paying their debts as they become due. Here, three or more petitioning creditors who are owed a total of at least $10,000 are required. If there are less than twelve creditors in total, then the involuntary petition may be filed by one creditor who is owed at least $10,000.

In Chapter 7 bankruptcy, the debtor files a petition with the court, which includes detailed financial information about his assets, debts, and income, and a list of the assets claimed as exempt. The papers filed with the court are executed under penalty of perjury and usually go thorugh court process which takes about 3 to 4 months.

Chapter 11 bankruptcy is a reorganization procedure used by businesses, regardless of whether it is sole proprietorship, partnerships or corporations. The debtor in chapter 11 files a petition which includes a list of assets and liabilities, and a detailed statement of financial affairs. The debtor will generally act as his own trustee, called a "debtor in possession," and will remain in possession of all estate property. In some cases though, the court can appoint a trustee for cause shown including mismanagement.

Chapter 13 bankruptcy, on the other hand, is a debt adjustment procedure for individuals with regular income, who have unsecured debts under $269,250 and secured debts under $807,750. Whatever it is you're filing for as long as its about bankruptcy, you do need our good Anderson bankruptcy attorney to guide you all throughout the process and to guard your best interests.

Read about Ann Arbor Bankruptcy Attorneys.