Consumer Bankruptcy Lawyers in Bessemer, Alabama
Bankruptcy is a legal procedure that allows an individual or business to have some or all of their debts discharged. It is usually considered as an option of last resort, because while it can stave off financial disaster, it has some significant long-term consequences warranting careful consideration of the costs and benefits. Bankruptcy is controlled by federal law, and proceeds in federal courts. So, the process for filing for bankruptcy in Alabama will be very similar to the process everywhere else in the U.S. However, individual bankruptcy courts have different rules for exemptions, so it might be a good idea to consult with a local lawyer in Bessemer, Alabama before filing.
Chapter 7 Bankruptcy in Bessemer, Alabama
In Bessemer, Alabama, there are 2 commonly-used types of consumer bankruptcy: Chapter 7 and Chapter 13. Chapter 7 bankruptcy involves a liquidation of some of the debtor's assets, which pays off part of his or her debt. Once this is done, the remaining debt is discharged. Fortunately for debtors, many forms of property are exempt from liquidation, including homes, vehicles, essential personal items, and retirement accounts.
Once eligible assets are sold, and the proceeds turned over to the creditors, most remaining debt is excused. However, some forms of debt cannot be discharged in bankruptcy, including student loans, taxes, child support, personal injury awards, and fines. If most of your debt in Bessemer, Alabama is not dischargeable, you may want to consider other options besides bankruptcy.
Chapter 13 Bankruptcy in Bessemer, Alabama
Chapter 13 Bankruptcy in Bessemer, Alabama differs significantly from Chapter 7. It might be a better option than Chapter 7, depending on the facts of your case. Chapter 13 does not discharge debt, but restructures it instead. Usually, 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 usually manageable, as long as the debtor can make some sacrifices.
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Which Type of Consumer Bankruptcy Should I File in Bessemer, Alabama
Whether Chapter 7 or Chapter 13 is the right choice for you depends heavily on your individual situation. If you have a stable income stream, and a lot of non-exempt property, Chapter 13 might be right for you. If you don't have a stable income, and most of your property is exempt, Chapter 7 might be a better way to go.
Of course, you should always seek the counsel of an accomplished local Bessemer, Alabama 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 particular situation.