Bankruptcy is a court proceeding which lets a person or business have some or all of their debts absolved. It should normally only be considered as an option of last resort, because it can have serious long-term consequences, even if it can stave off financial disaster. This means that the costs and benefits need to be carefully considered before filing. Bankruptcy is governed by federal law, and proceeds in federal courts. So, the procedure for filing for bankruptcy in North Carolina will be very similar to the procedure anywhere else in the U.S. However, individual bankruptcy courts have different rules for exemptions, so it might be a good idea to consult with a local attorney in Zebulon, North Carolina before filing.
Chapter 7 Bankruptcy in Zebulon, North Carolina
There are 2 common types of consumer bankruptcies in Zebulon, North Carolina: Chapter 7 and Chapter 13 bankruptcy. Chapter 7 requires that a certain percentage of the debtor's property be liquidated to pay off at least a small part of their debt. However, many types of property are exempt, and do not need to be liquidated, such as cars, homes, insurance policies, and retirement accounts.
Once the non-exempt property is sold, the rest of the dischargeable debt is absolved. Some types of debt, however, is non-dischargeable, including student loans, criminal fines, and others. If most of your debt in Zebulon, North Carolina is not dischargeable, Chapter 7 may not be the best option.
Chapter 13 Bankruptcy in Zebulon, North Carolina
Chapter 13 Bankruptcy in Zebulon, North Carolina is very different from Chapter 7. Whether or not it is a better option is highly 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 Zebulon, North Carolina
Whether Chapter 7 or Chapter 13 is the right choice for you depends heavily on your particular situation. If you have a steady income stream, and a lot of non-exempt property, Chapter 13 might be right for you. If you don't have a steady income, and most of your property is exempt, Chapter 7 might be a better way to go.
Regardless of your situation, you should speak with an attorney in Zebulon, North Carolina who is experienced in bankruptcy before making a decision. They will be able to advise you of your options, and the likely outcomes of each one, allowing you to make a much more informed decision.