Glenview IL Bankruptcy Attorney
If you are struggling to get out of debt, you may be considering bankruptcy. Health issues, divorce, unemployment, and other problems can cause debt to pile up fast. Bankruptcy might provide the fresh financial start you are looking for. But is it the right option for you?
Lorraine M. Greenberg is a Glenview IL bankruptcy attorney who can guide you through your decision with personalized, quality service. At Lorraine M. Greenberg & Associates, we understand that good people get into bad situations. Contact us today for a free consultation.
Is Bankruptcy Right for You?
Bankruptcy is a tool you could use to get out of mounting debt and handle creditors fairly. At the end, you can start over without the stress and burden of unpaid bills. But, filing for bankruptcy is not always the best option.
You should know what you are getting into when you file for bankruptcy. Bankruptcy will have a negative impact on your credit score for years. This will make it difficult to buy a house or car, start a business, or do anything else that requires a loan.
Though bankruptcy has benefits, you should explore other options. Negotiating more favorable terms with your creditors through debt consolidation and elimination lets you avoid bankruptcy. A Glenview IL bankruptcy attorney can help you explore your options and obtain better payment plans with your creditors. They can help you decide if bankruptcy is in your best interest based on factors and circumstances unique to you.
What Is Bankruptcy?
Put simply, bankruptcy can provide you relief from debt and a clean financial slate. There are two types of bankruptcy:
- Chapter 7 bankruptcy allows you to eliminate qualifying debt. This includes “dischargeable” debt, such as credit card and medical bills and loans. In exchange, a bankruptcy trustee will sell some of your property. The sales proceeds will be used to pay your creditors. Often called “straight bankruptcy” or “liquidation bankruptcy”, Chapter 7 is the most common form of personal bankruptcy. It can take four to six months to complete.
- Chapter 13 bankruptcy reorganizes your debt into a three- to five-year repayment plan. Also called “debt reorganization” or “wage earner bankruptcy”, Chapter 13 takes longer than Chapter 7 to complete.
What Type of Bankruptcy Should You File?
Chapter 7 bankruptcy is right for you if your income is low enough and the type of debt you owe qualifies. To file for Chapter 7 bankruptcy, you must pass a “means test”. If you have enough monthly disposable income to repay your debts, you may not qualify. If your income is less than the median income for a similar household, then you will qualify.
Chapter 7 works if you don’t plan on getting deep into debt for a very long time. You are limited to a discharge every eight years.
Chapter 13 bankruptcy is right for you if your debt is non-dischargeable or you make too much money. Examples of non-dischargeable debt include student loans, taxes, child support, alimony, and penalties and fines owed for breaking the law.
To qualify for Chapter 13, you must have a reliable source of income to repay a portion of your debt. It is a good option if you would like to save your house from foreclosure or car from repossession.
So, as you consider whether bankruptcy is right for you, you should also think about what type of bankruptcy will work. Keep in mind the type of debts you owe, your income and expenses, and what you hope to achieve with bankruptcy.
Will Bankruptcy Clear My Debt?
Bankruptcy will not wipe out all your debt. So, before you file, you should work with a bankruptcy attorney to assess how to get rid of your debt. If most of your debt comes from dischargeable credit card, medical, and personal loan obligations, bankruptcy will probably work. It might not if you have a substantial amount of non-dischargeable child support, alimony, tax, or student loan debt.
Will I Be Able to Keep My Property?
Bankruptcy allows you to protect a share of your property if they are exempted. You may be able to protect other, non-exempted assets depending on whether you file for Chapter 7 or 13 bankruptcy.
If you file for Chapter 7 bankruptcy, any non-exempt property can be sold. The sale proceeds will be used to pay back your creditors.
On the other hand, if you file for Chapter 13 bankruptcy, you could keep all your property. To do so, you’ll have to pay your debts in an amount equal to the value of your non-exempt assets.
The bottom line is that, if you have a lot of non-exempt property, bankruptcy might not be your best option. Contact a Glenview IL bankruptcy attorney to find out how much of your property you can protect in bankruptcy.
Can Bankruptcy Stop Foreclosure or Repossession?
If a lender has started foreclosure or repossession proceedings on your home or car, you can stop or delay it through bankruptcy. A bankruptcy court could issue you an “automatic stay”, which stops all creditor actions against you during the bankruptcy process. It also prohibits creditors from contacting and harassing you.
The automatic stay becomes effective once you file for bankruptcy with the court. At that point, the court will notify your creditors that they should not contact you directly. They will not be able to proceed with foreclosure on your home or repossession of your car. They will have to attend a creditors meeting or call your bankruptcy attorney instead.
After you file for bankruptcy, creditors may be more willing to change your payment plan on your home or car. If you file for Chapter 13 bankruptcy, your repayment plan may allow you to catch up on house and car payments. A Glenview IL bankruptcy attorney can deal with your creditors to help you keep your property.
Contact a Glenview IL Bankruptcy Attorney Today
If you are struggling with mounting debt, a Glenview IL bankruptcy attorney can help. At Lorraine M. Greenberg & Associates, we offer the peace of mind that comes with knowing a qualified, experienced bankruptcy attorney is in your corner. Contact us today to learn how we can help you stop creditor harassment, foreclosure, garnishments and more.