Indianapolis Bankruptcy Lawyer
Chapter 7 bankruptcy, also known as “liquidation,” is allowed for (a) businesses and (b) individual debtors whose debts are primarily business debts or whose gross family income is below a certain level. Chapter 7 bankruptcy allows a debtor to discharge most of the debtor’s unsecured debts in exchange for giving up his or her non-exempt assets. Due to the generous exemptions permitted by Indiana law, the vast majority of Chapter 7 cases are considered “no asset” cases and debtors do not lose any property. For “secured debts,” which are debts for which the creditor has a lien on property, such as car loans and home mortgages, debtors may elect, but are not obligated, to “reaffirm” the debt with the creditor and keep their property after the bankruptcy so long as the debtor is current on payments.
Chapter 13 bankruptcy, also known as “reorganization” is available to individuals only and requires the individual to have a regular income to form a budget. This Chapter permits a debtor to pay back her creditors over the course of 3-5 years, many times at a reduced rate. Upon completion of the plan, debtors receive a discharge. Many debtors who qualify for Chapter 7 elect to file a Chapter 13 because it allows them to catch up on their past due mortgage or car payments. In addition, certain debts such as debts owed to an ex-spouse from a divorce settlement, which are not considered domestic support, may be discharged upon completion of a Chapter 13 plan whereas such debts are not discharged in Chapter 7.
Trapp Law, LLC will assist you in determining whether you need to take a last-resort measure such as bankruptcy to reduce your debts. Call today for a free consultation at (800) 225-4562.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.