A Loveland bankruptcy attorney can help clients interpret the various types of filing codes. These legal guidelines are officially located in Title 11 of the United States Code. While there are six different chapters, a few are most commonly used.
Over 65 percent of all consumer filings in the U. S. Fall within Chapter 7, the easiest and quickest option. This procedure requires debtors to surrender all their non-exempt properties to an official trustee. Items which are exempt typically include household goods, older vehicles, and clothing. The trustee’s duty is to sell all the non-exempt items, and distribute the proceeds among the debtors’ unsecured creditors. The benefit to the debtor is eligibility for discharges of debts.
Business debtors usually opt to file under Chapter 11. This method allows companies to rehabilitate and reorganize themselves. Generally, businesses continue to function while they comply with court-mandated plans for repaying their debts. They become designated as Debtors in Possession (DIP), and retain the ownership of their assets. They may continue to manage the daily operations during the period of time in which they cooperate with court officials and creditors in negotiating and complying with re-payment plans.
Chapter 13 is also referred to as Wage Earner chapter. It is a rehabilitation program which provides payment plans for individuals who have regular sources of incomes. These debtors comply with a federal court-mandated plan to reimburse their debts in part or in full.
The Chapter 13 debt-consolidation program varies from the Chapter 7, which provides immediate and complete relief from oppressive, burdensome debts. However, the benefits of the Chapter 13 option include the ability to prevent foreclosures, and the cessation of collection agencies contacting non-filing co-signers (co-debtors) for the entire duration of the case.
Loveland bankruptcy professionals offer assistance with interpreting legal complexities. They may guide their clients through the different options which are available, and help to develop an appropriate plan for debt resolution. Their legal services are offered to families, businesses, and individuals.
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