Bankruptcy in Buckhannon, West Virginia is a court process which allows an individual or business who is drowning in debt to be relieved of their legal obligation to pay off some or all of their debt. Hopefully, this will allow both the debtor and creditors to move on with their lives. Of course, one should never view bankruptcy as a "get out of debt free" card, allowing someone to be relieved of their obligation to pay their debts just because they don't want to. It is meant to serve as a lifeline, preventing unmanageable debt from resulting in complete financial ruin. Accordingly, it is best treated as an option of last resort, because it can carry with it significant negative consequences, which must be weighed against the possible benefits. For example, filing for bankruptcy can severely damage a person's credit rating.
Therefore, it is a good idea to talk with an experienced bankruptcy lawyer in Buckhannon, West Virginia. They will be able to advise you on the likely legal and financial consequences of filing for bankruptcy, and help you determine if it's the right option for your. Because this determination depends heavily on the facts of each individual case, the counsel of a Buckhannon bankruptcy attorney cannot be substituted.
Types of Bankruptcy in Buckhannon, West Virginia
There are 3 bankruptcy schemes that are normally used in Buckhannon: Chapter 7, Chapter 13, and Chapter 11 bankruptcy. Bankruptcy is governed by federal law, so the procedures in Buckhannon, West Virginia are very similar to what they will be anywhere else in the United States. Chapter 7 bankruptcy requires the debtor to liquidate some of his or her property, and use the proceeds to pay creditors. While this doesn't sound like much of a relief at first glance, the upshot is that once the eligible property is sold, and the proceeds given to the creditors, all of the debtor's eligible debts are deemed paid in full, regardless of how much the creditors actually ended up getting. Not all of the debtor's property has to be sold off - the debtor will usually be allowed to keep things like a house, at least one car, some types of personal property, retirement accounts, and insurance policies. It should be noted that some debts are not dischargeable, and will have to be paid in full even if the debtor files for bankruptcy. This includes student loans, taxes, and criminal fines.
The other normally used bankruptcy system in Buckhannon is Chapter 13 bankruptcy. This allows a debtor to repay most or all of their debts in a structured manner. It reorganizes the debt into lower periodic payments that, with a bit of frugality, the debtor should find manageable. This allows the debtor to continue to earn a living, and allows the creditors to eventually collect what they are owed. Once a repayment plan is approved by the bankruptcy court, creditors are legally barred from seeking repayment under the terms of the agreements that gave rise to the debt in the first place, and will instead have to accept payment under the new plan. Chapter 13 bankruptcy is usually a better option for people who have a steady income. Chapter 11 bankruptcy is almost exclusively used by businesses, but there is nothing that legally prevents it from being used by individuals, and its use by individuals is very rare. Chapter 11 bankruptcy requires the debtor to come up with a restructuring plan - telling the court how they propose to cut costs, improve their operations, and pay down their debts. The plan has to be approved by a majority vote of participating creditors.
A main advantage of Chapter 11 bankruptcy is that businesses can continue their operations while going through the process. Also, they can continue to buy and sell their stock.
How Can a Buckhannon Bankruptcy Lawyer Help?
Filing for bankruptcy in Buckhannon is a very important decision, and should not be made lightly. Before filing, one should consult with a good Buckhannon bankruptcy attorney for advice.