Frequently Asked Questions About Bankruptcy
If you are considering bankruptcy, you likely have many questions about its advantages and disadvantages, how it will affect your financial situation and whether it is right for you.
Adelsperger & Kleven, LLP, is there to answer all your bankruptcy questions, evaluate your situation and help you make informed decisions about your financial future.
A few of the most common questions individuals have about bankruptcy include the following:
What is bankruptcy?
Bankruptcy is the legal status of individuals or entities that are unable to repay outstanding debts to creditors. In most cases, the debtor initiates bankruptcy proceedings by filing a petition in federal court.
Do all debts get discharged through bankruptcy?
Certain debts, no matter under which chapter you file, cannot be discharged through bankruptcy. Examples of these debts include:
- Child support
- Spousal support/alimony
- Outstanding taxes
- Other court-ordered fines, restitution or penalties
How does bankruptcy affect your credit?
A common fear of life after bankruptcy is how it will negatively impact your financial future. While a bankruptcy will remain on your record for some time, it also provides considerable relief and allows you a fresh start toward rebuilding your credit.
Anyone contemplating bankruptcy is already struggling with credit issues. These typically include missed payments, loan defaults, repossessions and pending lawsuits. Bankruptcy is a procedure designed to help those individuals and entities re-establish their financial position.
Determining Which Chapter Of Bankruptcy Is Right For You
Adelsperger & Kleven, LLP, represents individuals, entities and trustees involved in all bankruptcy matters relating to:
- Chapter 7: Known as “liquidation” bankruptcy, this is among the most common type of bankruptcy filed by individuals.
- Chapter 11: This “reorganization” bankruptcy applies to corporations that wish to remain in business while negotiating and completing a repayment plan.
- Chapter 12: This form of bankruptcy applies only to family farmers and family fishermen. It allows them to restructure and propose a three- to five-year debt repayment plan.
- Chapter 13: Also referred to as “wage earner” bankruptcy, it applies to individuals with a regular source of income who are unable to pay their debts.
Each chapter of bankruptcy has specific eligibility requirements. To learn more about these requirements and your options for debt relief, enlist the support of one of our experienced, compassionate bankruptcy attorneys.
Still Have Questions About Bankruptcy? Ask Us Today.
Adelsperger & Kleven, LLP, has represented clients in Fort Wayne and throughout Indiana for more than 30 years. We have the knowledge and resources to answer all your bankruptcy questions and offer strong legal support and guidance throughout the process.