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 Wappingers Falls, New York will have some unique rules, however, so you should consult with a local lawyer before you file.
Chapter 7 Bankruptcy in Wappingers Falls, New York
There are 2 main types of consumer bankruptcy in Wappingers Falls, New York: Chapter 7 and 13. Chapter 7 bankruptcy involves liquidation of some of the debtor's assets. It requires some percentage of the debtor's property to be sold in order to pay off as much of his or her debt as possible. However, the majority of property that most people own is exempt. This normally includes homes, vehicles, insurance policies, and retirement accounts. These do not have to be sold.
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 Wappingers Falls, 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 Wappingers Falls, New York
In Wappingers Falls, New York, chapter 13 is extremely different from Chapter 7, and may or may not be the best option for you, depending on your situation. Chapter 13 bankruptcy does not discharge debt. Instead, it restructures it. This involves the bankruptcy court coming up with a new payment plan that supersedes the terms of the contracts that gave rise to the debt in the first place. This results in an altered payment plan that the debtor should find manageable, if he or she can make a few sacrifices.
Which Type of Consumer Bankruptcy Should I File in Wappingers Falls, New York
Which Bankruptcy type to file under depends strongly on the facts of each particular case. If you have a stable stream of income (enough to make a payment plan manageable), and a large amount of non-exempt property that you don't want to part with, Chapter 13 may be best for you. If you don't have a stable income or large amounts of non-exempt property, you may be better off filing for Chapter 7.
Whatever your situation, you should speak with a local Wappingers Falls, 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.