Bankruptcy in Hawaii is a legal process through which some of the debts of an individual or a business are absolved (excused). You should not view bankruptcy as an opportunity to eliminate your debts just because you don't feel like paying them - it can be a long and difficult procedure. Bankruptcy is designed to be a last resort to prevent complete financial ruin, while allowing creditors to collect at least some of their debts in an orderly fashion. Filing for bankruptcy can have major negative effects on one's credit score, which will make it more difficult to get loans in the future.
Accordingly, if you are considering bankruptcy as an option, you need to thoroughly examine the costs and benefits. A good Hawaii bankruptcy lawyer can advise you as to the pros and cons of bankruptcy, and give his or her expert opinion about whether or not bankruptcy is a good option, based on the facts of your particular case.
Types of Bankruptcy in Hawaii
Bankruptcy is governed by federal law, so the procedures in filing for bankruptcy in Hawaii will be the same as everywhere else in the United States. There are 2 basic forms of bankruptcy that consumers typically use: Chapter 7, and Chapter 13, owing their names to where they are found in the U.S. Bankruptcy Code. Additionally, there is a form of bankruptcy usually used by businesses called Chapter 11. Chapter 11 is available to individuals, but it is rarely the best option for them.
In Hawaii, Chapter 7 bankruptcy is known as "liquidation." When a person files for Chapter 7 bankruptcy, a trustee is appointed by the bankruptcy court to do an accounting of the debtor's property. The trustee then determines what pieces of property, if any, should be sold off to pay off the debts. Many forms of property are exempt from forced sale up to a certain dollar amount, including houses, cars, and retirement accounts. Once the property is sold, any remaining dischargeable debt is eliminated. Chapter 13 bankruptcy usually reorganizes, rather than discharges, one's debts. Essentially, the court will come up with some type of repayment plan, independent of the terms of the agreements that created the debt in the first place (superseding any acceleration clauses). This is meant to give the debtor some breathing room, allowing them to repay their debts over time, without facing financial ruin in the process.
Usually, Chapter 11 bankruptcy is used by businesses as opposed to individuals. Much like Chapter 13, Chapter 11 involves the reorganization, as opposed to discharge, of a debtor's obligations. However, it is up the to the debtor to come up with a repayment plan, and once this happens, the plan is submitted to the participating creditors, who must approve it by majority vote.
How Can a Hawaii Bankruptcy Lawyer Help?
Filing for bankruptcy is a major decision. While it can be beneficial, it's virtually guaranteed that there will be some negative consequences, such as damage to one's credit. Of course, with the advice of a Hawaii bankruptcy lawyer, it's possible that you will find the benefits to outweigh the costs, but only a bankruptcy lawyer can help you make that decision.
Interesting Facts About Hawaii
Hawaii is nicknamed "The Aloha State" and is the newest U.S. state, being added as the 50th state only in the year 1959. The state capitol of Hawaii is Honolulu, one of Hawaii's major cities. Hawaii's state government is unique in that it has several remnants and adaptations carrying over from Hawaii's early kingdom era.
Hawaii laws are mostly the product of its bicameral state legislature, which meets at the State Capitol building, Aliiolani Hale, located in Honolulu. The historic capitol building houses a Judiciary History Center featuring multi-media presentations of several landmark Hawaii legal cases. In 2006, the American Bar Association hosted a mock-trial presentation of the Massie Trial, a famous Honolulu criminal trial dating back to the year 1932.
Unlike other U.S. states, Hawaii does not operate any municipal governments- all localities are administered through the county system. Hawaii's judicial system is composed of the Hawaii State Circuit Courts (the lowest level), followed by an Intermediate Court of Appeals. The Hawaii Supreme Court is the highest court. Hawaii also maintains a few courts focused on specific issues, such as the Hawaii Land Court and the Hawaii State Tax Appeal Court.
Lawyers in Hawaii are well-versed in the laws and legal issues of the state. Hawaii attorneys typically file most of their claims at the Circuit Courts, which have broad jurisdiction over most common legal claims. Hawaii lawyers also process more complex claims and appeals through the Court of Appeals or through the Hawaii Supreme Court.