Bankruptcy in Weirton, West Virginia is a court procedure which allows an individual or business who is drowning in debt to be absolved of their legal requirement 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 absolved of their requirement to pay their debts just because they don't want to. It is meant to serve as a lifeline, preventing uncontrollable 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 heavily damage a person's credit rating.
For that reason, it would be advisable to speak with a good Weirton, West Virginia bankruptcy attorney. This attorney will be able to advise you as to whether or not filing for bankruptcy is a good idea, given your individual situation. This determination is highly dependent on the details of each individual case, so a Weirton attorney's advice is absolutely indispensable.
Types of Bankruptcy in Weirton, West Virginia
In Weirton, West Virginia, there are three basic bankruptcy schemes that are most often used. They are recognized as Chapter 7, Chapter 13, and Chapter 11. Being a product of federal law, the procedural rules governing bankruptcy in Weirton, West Virginia will be very similar to those in any other part of the United States. Chapter 7 bankruptcy involves liquidation of part of the debtor's assets to pay off as much of his or her debt as possible. Once the liquidation is fulfilled, and the proceeds given to the creditors, the rest of the debt is discharged. Liquidation is essentially selling assets to the highest bidder. Only some of the debtor's assets have to be sold, and numerous classes of property are exempt, meaning that the debtor can keep them, including homes, cars, insurance policies, and retirement accounts. It should be noted that certain types of debt cannot be discharged through Chapter 7 bankruptcy, including student loans, child support payments, criminal fines, and recent taxes.
The other frequent bankruptcy scheme used by consumers in Weirton 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 contracts 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. Though accessible to individuals, Chapter 11 bankruptcy is generally used by businesses. Like Chapter 13, Chapter 11 requires the restructuring of debts. Under this system, the debtor must come up with a plan to reduce debt, cut costs, and improve operations. Once this plan is presented, it is submitted to the participating creditors, who must approve it by a majority vote before it can be implemented.
While going through Chapter 11 bankruptcy, a business can continue operating, and its stock can continue to be traded.
How Can a Weirton Bankruptcy Lawyer Help?
The need to consider all the options and consider the costs and benefits of applying for bankruptcy in Weirton cannot be overstated. If you are considering filing for bankruptcy, it would be a good idea to speak with a Weirton bankruptcy attorney beforehand.