Bankruptcy is a legal procedure allowing a person or business to have their debts excused, in part or in whole. It is typically treated as a last resort, because, while it can prevent financial catastrophe, it has some influential 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 Kansas 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 Andover, Kansas bankruptcy attorney beforehand.
Chapter 7 Bankruptcy in Andover, Kansas
There are 2 typical forms of bankruptcy in Andover, Kansas. They are known as Chapter 7 and Chapter 13 Bankruptcy. Chapter 7 bankruptcy involves a liquidation of some of the debtor's assets, which pays off part of his or her debt. Once this is done, the remaining debt is excused. Fortunately for debtors, many forms of property are exempt from liquidation, including homes, vehicles, necessary personal items, and retirement accounts.
Once eligible assets are sold, and the proceeds turned over to the creditors, most remaining debt is absolved. However, some forms of debt cannot be discharged in bankruptcy, including student loans, taxes, child support, personal injury awards, and fines. If most of your debt in Andover, Kansas is not dischargeable, you may want to consider other options besides bankruptcy.
Chapter 13 Bankruptcy in Andover, Kansas
Chapter 13 Bankruptcy in Andover, Kansas differs considerably from Chapter 7. It might be a better option than Chapter 7, depending on the facts of your case. Chapter 13 Bankruptcy involves a court setting up an altered payment plan, which allows the debtor to pay off most or all of his debts over an extended period of time, through monthly payments that should, assuming that the debtor is willing to make a few sacrifices, be manageable.
Which Type of Consumer Bankruptcy Should I File in Andover, Kansas
The answer to this question depends strongly on your distinct 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.
In any case, you should talk with a local Andover, Kansas bankruptcy lawyer. Your lawyer can advise you of your options and inform you of their likely result. This will make it much easier for your to make an informed choice.