Bankruptcy is a legal procedure allowing a person or business to have their debts discharged, in part or in whole. It is usually treated as a last resort, because, while it can prevent financial catastrophe, it has some major long-term consequences. This warrants careful consideration of the costs and benefits. Bankruptcy is controlled by federal law and handled in federal courts, so the procedural and substantive rules involved in Illinois are often the identical as everywhere else in the U.S. However, individual bankruptcy courts have slightly different rules for items such as exemptions, so it would be a good idea to consult with a local Oak Brook, Illinois bankruptcy Attorney beforehand.
Chapter 7 Bankruptcy in Oak Brook, Illinois
In Oak Brook, Illinois, there are 2 commonly-used types of consumer bankruptcy: Chapter 7 and Chapter 13. Chapter 7 states that a certain percentage of the debtor's property be liquidated to pay off at least a small part of their debt. However, many forms of property are exempt, and do not need to be liquidated, such as cars, homes, insurance policies, and retirement accounts.
Once eligible assets are sold, and the money turned over to the creditors, most remaining debt is discharged. However, there are certain types of debt that cannot be discharged in bankruptcy, including student loans, taxes, child support, and criminal fines. If most of your debt is non-dischargeable, it may not be a good idea to file for bankruptcy in Oak Brook, Illinois.
Chapter 13 Bankruptcy in Oak Brook, Illinois
In Oak Brook, Illinois, chapter 13 is extremely different from Chapter 7, and may or may not be the best option for you, depending on your situation. 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.
Which Type of Consumer Bankruptcy Should I File in Oak Brook, Illinois
The answer to this question depends strongly on your individual situation. If you have enough stable income to manage a payment plan, and a lot of non-exempt property that you are unwilling to part with, Chapter 13 may be a good option. If you don't have much stable income, and most of your property is exempt, Chapter 7 might be better.
Whatever your situation, you should speak with a local Oak Brook, Illinois bankruptcy Lawyer. Your Attorney will be able to advise you of your options and their likely consequences, which will help you make a more educated decision.