Filing bankruptcy is when a person declares himself to be unable to pay his debts. It is a legal proceeding that enables insolvent persons to have a fresh start and is a legal right under federal law. As such, anyone can avail of this kind of remedy. Filing for bankruptcy gives you protection such as stopping your debt collectors from harassment, collecting debt, foreclosure or repossession, and wage garnishment until the bankruptcy court sorts out your debts.
What are the Different Types of Debts?
There are multiple debts a person can get into. In declaring bankruptcy, you must disclose all your unpaid debts for your liabilities to be discharged. Such debts include:
- Medical Bills
- Mortgage loans
- Car loans
- Personal loans
- Credit card debt
The debts above are debts that can be fully discharged. However, not all kinds of debts may be wiped out. Those that you still need to pay-back are:
- Alimony
- Child support
- Student loans
- Tax debt
- Debts from a “secured” creditor
- Criminal fines
- Court restitution orders
What are the Types of Bankruptcy in Louisiana?
There are different kinds of bankruptcy in Louisiana that one can avail of, the filed chapter must be applicable to you before filing for a bankruptcy petition. Some of the most common bankruptcy chapters are:
Chapter 7 Bankruptcy
– also known as no-asset bankruptcy, straight bankruptcy, or liquidation bankruptcy because this chapter requires the debtor to surrender all his property not exempt by law for the assets to be liquidated or sold to pay all the creditors. This chapter allows you to eliminate most, if not all, of your debts in a fast way at the cost of selling your valuable assets. If you want to keep some or most of your property, this chapter may not be suitable for you.
Chapter 11 Bankruptcy
– or “reorganization” is an option available for qualified businesses or corporations in case they cannot avail of Chapter 13 due to large amounts of debts. In this chapter, the debtor enters into a repayment plan with the creditors while still conducting business and may take quite some time and money in order for the debt to be fully paid.
Chapter 13 Bankruptcy
– is also known as debt adjustment because the debtors create a repayment plan based on their current income and capability. This chapter is only available for people with stable work and income because they need to pay off their debts over time. Chapter 13 enables the debtors to keep their personal property unlike in Chapter 7.
How can I File Bankruptcy in Louisiana?
As required by the Bankruptcy Code, for you to qualify in bankruptcy, you must first undergo:
Means Testing
– this is a compulsory test you need to do to declare Chapter 7 Bankruptcy. You will need to fill out all the bankruptcy documents and disclose your financial status. You must also reach the median income required in Louisiana or else, you may not qualify for Chapter 7.
Credit Counseling
– is a session of bankruptcy counseling available online or through phone from an accredited credit counseling service or agency approved by the U.S. Trustee in Louisiana.
Are you considering a bankruptcy filing?
If you are planning to declare or already declaring bankruptcy, having a bankruptcy lawyer will greatly help you. Filing bankruptcy without a bankruptcy attorney will be challenging because the law is complex and the bankruptcy process is very tedious especially if one does not have the technical know-how on how to deal with it. We at E. Orum Young Law have experienced bankruptcy attorneys in Monroe, Louisiana that will help you through the legal process needed including restructuring of debts, representing you in the bankruptcy court as well as opening all the other legal options available to you. Call our Monroe bankruptcy lawyers now for a free legal consultation.
