In Belle Isle, Florida, bankruptcy is a court procedure in which a person or business has some or all of their debts excused (or "discharged"), theoretically allowing them to start with a clean slate, and move on with their lives no longer drowning in debt (and hopefully having learned to better manage their use of credit in the process). However, bankruptcy should not be treated as a way to avoid debt that one simply doesn't feel like paying. It is meant to be a safety net for people or businesses who are truly unable to pay off their debts. Because bankruptcy is not without negative consequences (such as a heavily damaged credit rating for many years afterward), it should be viewed as an option of last resort.

Accordingly, you should speak with a good Belle Isle, Florida bankruptcy lawyer. Your Belle Isle bankruptcy lawyer can inform you of the costs and benefits of filing for bankruptcy, and give his or her professional opinion as to whether or not it's a good option, given your particular circumstances.

Types of Bankruptcy in Belle Isle, Florida

In Belle Isle, Florida, there are three basic bankruptcy schemes that are most commonly used. They are known as Chapter 7, Chapter 13, and Chapter 11. Being a product of federal law, the procedural rules governing bankruptcy in Belle Isle, Florida will be very similar to those in any other part of the United States. Chapter 7 bankruptcy, or "liquidation," requires the debtor to sell some of his or her property to the highest bidder, and using the funds from the sale to pay down as much debt as possible. Once the sale is complete, all dischargeable debt is deemed paid in full, whether or not the sale was able to raise the full amount owed. You should note that some property (usually the types of property deemed essential) is fully or partially exempt from liquidation, meaning that the debtor gets to keep it. This includes houses, cars, and retirement accounts, among others. Some types of debts, however, cannot be discharged in bankruptcy, including taxes, child support, and student loans.

Under Chapter 13 bankruptcy in Belle Isle, most of the debtor's debt is not discharged. Instead, the bankruptcy court, working with the debtor and participating creditors, work out a payment plan that allows the debtor to pay off most of his or her debts over a longer period of time, thereby theoretically making the debt far more manageable. Once a payment plan is approved by the court, creditors are prohibited from attempting to collect payment under their original agreements that gave rise to the debt in the first place. Although it can be used by individuals, Chapter 11 bankruptcy is used almost always by businesses. Not unlike Chapter 13, Chapter 11 focuses on restructuring of debt, rather than discharging it. Chapter 11 requires that the debtor come up with a reorganization plan designed to reduce debt and cut costs. Before being implemented, this plan must be approved by a majority vote of participating creditors.

During the Chapter 11 process, a business can usually continue its operations, and the stock can be traded, even if it is de-listed from a major stock exchange.

How Can a Belle Isle Bankruptcy Lawyer Help?

Filing for bankrtuptcy in Belle Isle is a major decision with costs and benefits that must be weighed carefully. Before filing, it would be a good idea to speak with a seasoned Belle Isle bankruptcy attorney.