Bankruptcy is a legal procedure allowing a person or business to have their debts absolved, in part or in whole. It is normally treated as a last resort, because, while it can prevent financial catastrophe, it has some huge 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 Indiana 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 Gas City, Indiana bankruptcy attorney beforehand.
Chapter 7 Bankruptcy in Gas City, Indiana
In Gas City, Indiana, there are 2 common types of commonly-used 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 all non-exempt assets are sold, and the money from the sales turned over to the creditors, most remaining debt is absolved. But some forms of debt cannot be discharged through Chapter 7 bankruptcy. These include child support payments, student loans, and criminal fines, among others. If most of your Gas City, Indiana debts are not dischargeable, you may want to consider options other than bankruptcy.
Chapter 13 Bankruptcy in Gas City, Indiana
Chapter 13 Bankruptcy in Gas City, Indiana is very different from Chapter 7. Whether or not it is a better option is very dependent on the facts of each particular case. Chapter 13 does not absolve debt, but restructures it instead. Normally, 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 normally manageable, as long as the debtor can make some sacrifices.
Which Type of Consumer Bankruptcy Should I File in Gas City, Indiana
This depends entirely on the facts of your individual case. If you have a decent amount of stable income, and a large amount of non-exempt property which you don't want to part with, Chapter 13 may be the best option for you. If most of your property is exempt, and you don't have much stable income, Chapter 7 might be the best option.
In any case, you should talk with a local Gas City, Indiana bankruptcy lawyer. Your lawyer can advise you of your options and inform you of their likely outcome. This will make it much easier for your to make an informed choice.