In Plaquemine, Louisiana, bankruptcy is a legal proceeding in which a person or business has some or all of their debts legally cleared, when they are unable to pay them. This hopefully allows them to start over with a clean slate and move on, after having learned to better manage their use of credit in the process. Remember, though, that bankruptcy should not be viewed as a fitting way to get out of debt that you don't feel like paying back. It is meant to serve as an option of last resort for people and businesses faced with debt that they will probably never be able to pay back. The decision to file for bankruptcy can result in negative consequences, such as damaged credit ratings, which must be seriously weighed against the probable benefits.
Accordingly, it might be a good idea to consult with a Plaquemine, Louisiana bankruptcy attorney. Your lawyer will be able to counsel you about your options, including alternatives to bankruptcy, if such alternatives exist in your case. Whatever the result, it is often challenging to anticipate the long-term consequences of any bankruptcy-related decisions, so the advice of a bankruptcy in Plaquemine could prove invaluable.
Types of Bankruptcy in Plaquemine, Louisiana
In Plaquemine, Louisiana, there are 3 types of bankruptcy in common use: Chapter 7, Chapter 13, and Chapter 11. Because bankruptcy is a creation of federal law, the procedures governing bankruptcy in Plaquemine, Louisiana will be similar anywhere else in the U.S. Chapter 7 bankruptcy requires the debtor to liquidate some of his or her assets in order to pay off as much debt as possible. Once the sale of the assets is complete, and the proceeds handed over to the creditors, the debt is viewed as discharged. Liquidation is basically selling assets to the highest bidder. Not all of the debtor's assets will need to be sold, and many types of property are entirely or partially exempt, including homes, cars, retirement accounts, and insurance policies. This means that the debtor can keep them. It should be noted that some types of debts are not dischargeable in Chapter 7 bankruptcy, including student loans, criminal fines, taxes, and child support payments. Even when the bankruptcy process is complete, these debts will have to be paid in full.
Under Chapter 13 bankruptcy in Plaquemine, most of the debtor's debt is not discharged. Instead, the bankruptcy court, working with the debtor and participating creditors, work out a payment plan that allows the debtor to pay off most of his or her debts over an extended period of time, therefore theoretically making the debt far more manageable. Once a payment plan is approved by the court, creditors are prohibited from attempting to collect payment under their original agreements that gave rise to the debt in the first place. Though applicable to individuals, Chapter 11 bankruptcy is typically used by businesses. Like Chapter 13, Chapter 11 requires the restructuring of debts. Under this system, the debtor must come up with a plan to reduce debt, cut costs, and improve operations. Once this plan is finalized, it is submitted to the participating creditors, who must approve it by a majority vote before it can be implemented.
During the Chapter 11 process, a business can typically continue its operations, and the stock can be traded, even if it is de-listed from a major stock exchange.
How Can a Plaquemine Bankruptcy Lawyer Help?
The need to examine all the options and consider the costs and benefits of filing for bankruptcy in Plaquemine cannot be overstated. If you are considering filing for bankruptcy, it would be a good idea to speak with a Plaquemine bankruptcy attorney beforehand.