Bankruptcy in Illinois 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 Illinois 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 distinct case.
Types of Bankruptcy in Illinois
Bankruptcy is governed by federal law, so the procedures in filing for bankruptcy in Illinois 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 normally used by businesses called Chapter 11. Chapter 11 is available to individuals, but it is rarely the best option for them.
Chapter 7 bankruptcy in Illinois is sometimes called "liquidation" because it involves the forced sale of some (though certainly not all) of the debtor's assets. The bankruptcy court will appoint a trustee to oversee the appraisal and sale of some of the debtor's property, and the proceeds from the sale will go to the creditors, in their order of priority. Certain forms of property are exempt, and do not need to be sold, including houses and insurance policies. Once the property is sold, and the proceeds given to the creditors, the rest of the debt is excused. Under Chapter 13 bankruptcy, debt is normally not excused; instead, it is reorganized. The court will craft a long-term payment plan that allows the debtor to pay off his or her debts in single payments, over time. This usually gives the debtor some breathing room that would not exist if all of his or her debts became due and payable at once.
Chapter 11 bankruptcy, like Chapter 13, involves reorganization of debt. However, it is almost always used by businesses, and not individuals. After filing for Chapter 11, the debtor has to come up with a repayment plan. The plan must then be approved by a majority vote of participating creditors.
How Can a Illinois Bankruptcy Lawyer Help?
Filing for bankruptcy is a very big decision, frought with risks. However, in some cases, the benefits might outweigh the costs. Because of this, it is important to seek the advice of a Illinois bankruptcy lawyer, who can advise you of the likely consequences of filing, and whether or not doing so is likely to benefit you.
Interesting Facts About Illinois
Illinois is nicknamed "The Prairie State" and "The Land of Lincoln". It has the fifth largest population in all of the U.S. and achieved statehood in the year 1818. With its broad industrial base and economic productivity, it is sometimes referred to as a "microcosm" of America. Illinois is often looked to as a bellwether in terms of social, cultural, and political trends.
Of the 50 states, Illinois is noted for having a distinct and variegated system of governance. At the local level, Illinois' government is perhaps the most complex of all states. Many different districts have been created for specific functions. For example, there are school districts, library districts, sanitary districts, watershed districts, land use districts, and many others. These individual miniature government units often have their own taxing and election authority.
In contrast to its local governance system, the court system of Illinois is relatively simple. It is composed of Circuit Courts, Appellate Courts, and the Illinois Supreme Court. Most legal claims in Illinois are processed at the circuit court level. Appeals and more complex matters are typically heard in the Appellate Courts or at the Supreme Court.
The Supreme Court of Illinois maintains the "Supreme Court Commission of Professionalism". The Commission is responsible for maintaining the professional standards for lawyers, judges, and for the justice system overall. Lawyers in Illinois practice law according to these standards, thus ensuring the quality of legal services provided to clients. Illinois lawyers are also familiar with the state's complex governance system.