Bankruptcy is a court proceeding which lets a person or business have some or all of their debts discharged. It should usually 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 Ohio will be the same as everywhere else in the country. Individual courts in Deer Park, Ohio will have some unique rules, however, so you should consult with a local lawyer before you file.

Chapter 7 Bankruptcy in Deer Park, Ohio

There are 2 common types of consumer bankruptcy in Deer Park, Ohio: Chapter 7 and 13. 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 discharged. Fortunately for debtors, many forms of property are exempt from liquidation, including homes, vehicles, essential personal items, and retirement accounts.

Once the eligible property is sold, and the funds transferred to the creditors, the dischargeable debt is excused. Some forms of debt, however, can't be discharged in Chapter 7 Bankruptcy in Deer Park, Ohio. These include student loans, criminal fines, and taxes, among others. If most of your debt can't be discharged, Chapter 7 may not be the best choice for you.

Chapter 13 Bankruptcy in Deer Park, Ohio

Chapter 13 bankruptcy in Deer Park, Ohio is markedly different. It may or may not be a better option than Chapter 7, depending on the facts of your particular case. Chapter 13 bankruptcy does not eliminate debt, it restructures it. This involves a court coming up with a new repayment plan designed to be manageable for the debtor. This new plan sets aside the terms of the original agreements that created the debt in the first place. This creates a new payment structure, usually involving a single monthly payment, that the debtor should find manageable.

Which Type of Consumer Bankruptcy Should I File in Deer Park, Ohio

Chapter 13 is usually a good option for people who have a stable income, and a large amount of non-exempt property that they can't part with. On the other hand, if most of the debtor's property is exempt, and he or she does not have a stable income, Chapter 7 might be more beneficial.

Of course, you should always seek the counsel of an accomplished local Deer Park, Ohio bankruptcy attorney before you make the decision to file. He or she will be able to advise you of your options, and suggest the best possible course of action for your particular situation.