Bankruptcy is a legal procedure allowing a person or business to have their debts absolved, in part or in whole. It is normally treated as a last resort, because, while it can prevent financial catastrophe, it has some huge long-term consequences. This warrants careful consideration of the costs and benefits. Being a product of federal law, bankruptcy will go through federal courts. Accordingly, the procedure for filing for bankruptcy in Massachusetts is basically the same as the procedure anywhere else in the United States. However, individual courts in Burlington, Massachusetts will have particular rules for exemptions, so you should speak with a local attorney before filing.

Chapter 7 Bankruptcy in Burlington, Massachusetts

There are 2 common types of consumer bankruptcies in Burlington, Massachusetts: Chapter 7 and Chapter 13 bankruptcy. Chapter 7 involves liquidation of some of a debtor's assets. It requires that a certain percentage of the debtor's property to be sold to pay off as much debt as possible. The majority of property that most people own, however, is exempt. This normally includes homes, vehicles, retirement accounts, and others. These are not available to creditors.

Once the non-exempt property is sold, the rest of the dischargeable debt is absolved. Some types of debt, however, is non-dischargeable, including student loans, criminal fines, and others. If most of your debt in Burlington, Massachusetts is not dischargeable, Chapter 7 may not be the best option.

Chapter 13 Bankruptcy in Burlington, Massachusetts

Chapter 13 Bankruptcy in Burlington, Massachusetts is very different from Chapter 7. Whether or not it is a better option is highly dependent on the facts of each particular case. Chapter 13 does not absolve debt, but restructures it instead. Normally, various debts are consolidated into a single monthly payment. This is designed to make the debt more manageable, giving the debtor the chance to pay off the debt over a longer period of time, without all of it coming due at once. This is normally manageable, as long as the debtor can make some sacrifices.

Which Type of Consumer Bankruptcy Should I File in Burlington, Massachusetts

This depends entirely on the facts of your individual case. If you have a decent amount of steady income, and a large amount of non-exempt property which you don't want to part with, Chapter 13 might be the best option for you. If most of your property is exempt, and you don't have much steady income, Chapter 7 might be the best option.

Of course, you should always seek the counsel of an experienced local Burlington, Massachusetts bankruptcy attorney before you make the decision to file. He or she will be able to advise you of your options, and suggest the best possible course of action for your individual situation.