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 significant 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. Since it's a creation of federal law, bankruptcy is handled in federal courts. Therefore, the rules and procedures governing it in New York will be the same as everywhere else in the country. Particular courts in Seaford, New York will have some unique rules, however, so you should consult with a local lawyer before you file.

Chapter 7 Bankruptcy in Seaford, New York

There are 2 common forms of consumer bankruptcies in Seaford, New York: 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 absolved. Fortunately for debtors, many forms of property are exempt from liquidation, including homes, vehicles, basic personal items, and retirement accounts.

Once the qualifying property is sold, and the funds transferred to the creditors, the dischargeable debt is cleared. Some forms of debt, however, can't be absolved in Chapter 7 Bankruptcy in Seaford, New York. These include student loans, criminal fines, and taxes, among others. If most of your debt can't be absolved, Chapter 7 may not be the best choice for you.

Chapter 13 Bankruptcy in Seaford, New York

Chapter 13 Bankruptcy in Seaford, New York differs substantially 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 a revised payment plan, which allows the debtor to pay off most or all of his debts over a prolonged 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 Seaford, New York

The answer to this question depends strongly on your particular 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 Seaford, New York bankruptcy lawyer. Your attorney will be able to advise you of your options and their likely outcomes, which will help you make a more educated decision.