A Bankruptcy Overview

Harriet Langston, P.C., advises clients which type of bankruptcy to file. Lawyer Harriet Langston has over 28 years of experience helping individuals find solutions to their debt problems. With extensive knowledge of federal and state bankruptcy laws, she develops legal solutions that are uniquely suited to your personal financial situation.

Types Of Bankruptcy

There are two general types of bankruptcy: personal bankruptcy and business bankruptcy. Personal bankruptcy addresses the debt problems of individuals, which are often caused by credit card debt, late mortgage payments, unemployment and/or high medical bills. Business bankruptcy, on the other hand, addresses the debt problems of businesses or business owners. Business bankruptcy is commonly caused by poor investments, seismic economic shifts or even general maintenance costs.

Eligibility can be a key factor in determining which type of bankruptcy to file. Since the 2005 passage of the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), there are more criteria for qualifying for bankruptcy.

Chapter 7 Bankruptcy

Chapter 7 bankruptcy is used by individuals and businesses to discharge their debts. Chapter 7 is commonly known as liquidation because all nonexempt assets of the debtor are sold and distributed to creditors. In addition, debts are discharged and the debtor is afforded a fresh start.

Chapter 13 Bankruptcy

Chapter 13 bankruptcy is reserved for individuals with stable incomes who show some promise of being able to pay back some or all debt. Like Chapter 11 for businesses, Chapter 13 establishes a repayment plan — lasting between three to five years — which must be approved by the Bankruptcy Judge. Chapter 13 is sometimes used by debtors who fail the "means test" for Chapter 7, as required by the Bankruptcy Abuse Prevention and Consumer Protection Act.

Contact Harriet Langston, P.C.

Schedule a consultation with Ms. Langston to learn more about personal bankruptcy and whether or not your financial situation qualifies you to file.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.