Illinois Personal Bankruptcy Lawyers
Chicago Bankruptcy & Debt Relief Attorneys
Individuals and married couples have three alternatives for filing bankruptcy: Chapter 7 liquidation, Chapter 13 reorganization or Chapter 11 reorganization. The experienced Chicago bankruptcy lawyers at Loop Bankruptcy, a service of Lakelaw, can help explain the various bankruptcy options to you and help you determine which option is best for your situation.
Contact us now for a Free Consultation to determine which bankruptcy option is best for you.
(866) 525-3529 Chicago, Cook County, Lake County
When an individual or married couple files for Chapter 7 Liquidation, generally all debts will be discharged, including secured debts such as a car loan, if the debt is not reaffirmed by the debtor(s). In exchange for the forgiveness of debts, a bankruptcy trustee will be assigned to your case to liquidate assets in order to pay creditors a portion of what they are owed. You are, however, able to exempt, or protect, certain property from liquidation up to a designated dollar amount depending on the type of asset.
Each bankruptcy option has unique advantages and limitations. Let the skilled law firm of Loop Bankruptcy explain your options in detail at your Free Consultation.
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Not everyone is eligible for a chapter 7 discharge, however. Those persons that have filed a Chapter 7 bankruptcy in the previous 8 years or a Chapter 13 bankruptcy within the previous 6 years are not eligible to discharge their debts through a Chapter 7 bankruptcy. In addition, those individuals who have the ability to repay a portion of their debts, as determined by the means test, must file for bankruptcy under Chapter 13. Under Chapter 13 reorganization, an individual repays a portion of his or her debts over a period of three to five years. While some individuals are required to file under Chapter 13 due to their ability to repay a portion of their debts, other individuals may choose to file under Chapter 13 in order to protect their assets from liquidation.
In order to be eligible for Chapter 13, an individual must (i) have “regular” income, (ii) owe less than $1,081,400 in secured debt and less than $360,475 in unsecured debt and (iii) not have filed a previous chapter 7 within 4 years or a previous chapter 13 within 2 years.
Individuals who are not eligible for Chapter 7 bankruptcy or do not want to face liquidation, but are over the debt limit for Chapter 13, must file a Chapter 11 reorganization. Under a Chapter 11 bankruptcy, the debtor proposes a repayment plan, which must be approved by his or her creditors. Debts are not necessarily paid in full, but the debtor must use all of his or her disposable income to pay back creditors over the plan period of five years.
The automatic stay protects you from creditor contact immediately upon notice of the bankruptcy filing.
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The automatic stay protects all debtors regardless of the type of bankruptcy filed. Pursuant to the automatic stay, certain creditors are prohibited from contacting you by phone, sending statements or letters, filing or proceeding with lawsuits, and continuing with wage garnishments and citation proceedings. Sometimes, however, a debtor may wish to continue receiving statements regarding a secured debt but the creditor will stop doing so due to the automatic stay.Creditors will also stop automatic withdrawal payments. If you wish to reaffirm the debt with a particular creditor, you should continue to make voluntary payments throughout the duration of the bankruptcy.
If a creditor continues to pursue a debt after it receives notice of the bankruptcy by sending notices, making collection calls or filing a law suit, the debtor, through his or her attorney, can file a motion for sanctions against the creditor for damages, attorneys’ fees associated with filing the motion and punitive damages, which may be awarded in the judge’s discretion.
The automatic stay does not protect against all creditor contact. Loop Bankruptcy will help you understand your rights. Contact us now for a Free Consultation with a skilled Illinois personal bankruptcy attorney.
(866) 525-3529 Chicago, Cook County, Lake County
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