In Guymon, Oklahoma, bankruptcy is a judicial process in which the debts of a person or business can be cleared or restructured. This allows the debtor to climb out of a financial hole, and move on with a clean slate, which is often more economically useful than requiring the debtor to pay off everything they owe. However, bankruptcy is not a free ride, allowing someone who simply doesn't feel like paying their debts to get out of that legal requirement. It is designed to prevent debt which has slight chance of ever being paid back from ruining the life and finances of the debtor. It also carries significant long-term consequences, which must be carefully weighed against the potential benefits. For example, bankruptcy makes it very difficult for the debtor to obtain credit in the near future.
Accordingly, you should speak with a good Guymon, Oklahoma bankruptcy lawyer. Your Guymon bankruptcy lawyer can inform you of the costs and benefits of filing for bankruptcy, and give his or her professional evaluation as to whether or not it's a good option, given your specific circumstances.
Types of Bankruptcy in Guymon, Oklahoma
In Guymon, Oklahoma, 3 types of bankruptcy procedures are in common use: Chapter 7, Chapter 11, and Chapter 13. Being governed by federal law, the procedures involved in filing for bankruptcy in Guymon, Oklahoma will be roughly the same as everywhere else in America. Chapter 7 bankruptcy involves liquidation of many of the debtor's assets in order to pay off as much of the debt as possible. This sounds harsh, but there is an upside: once the liquidation is complete, the debts are legally viewed as having been paid in full, whether or not the full amount was covered by the liquidation. Liquidation involves selling some personal property, and using the funds to pay off debt. Numerous types of property are exempt from liqudiation, and therefore may not need to be sold. They include homes, cars, and insurance policies, among others. You should know that some types of debt cannot be discharged in Chapter 7 bankruptcy, including taxes, student loans, and child support.
The other frequent bankruptcy scheme used by consumers in Guymon is Chapter 13 bankruptcy. In this system, debt is not discharged. Instead, it is restructured. This allows the debtor to have the terms of the arrangements that gave rise to their debts in the first place thrown out, and replaced with new terms that call for a structured repayment plan, designed to allow the debtor to survive on whatever income they have, and allowing the creditors to get paid back eventually. Once a payment plan is authorized, creditors are not allowed to attempt to collect payment under the original agreements. Although it can be used by individuals, Chapter 11 bankruptcy is used almost always by businesses. Not unlike Chapter 13, Chapter 11 focuses on restructuring of debt, rather than discharging it. Chapter 11 requires that the debtor come up with a reorganization plan designed to reduce debt and cut costs. Before being enforced, this plan must be approved by a majority vote of participating creditors.
While going through Chapter 11 bankruptcy, a business can continue operating, and its stock can continue to be traded.
How Can a Guymon Bankruptcy Lawyer Help?
Filing for bankrtuptcy in Guymon is an influential decision with costs and benefits that must be weighed carefully. Before filing, it would be a good idea to speak with a seasoned Guymon bankruptcy attorney.