In a country with so much wealth, there are many individuals who are struggling with making meets end to provide for their families. According to reports by the U.S. Courts, in 2012 there were about 42,008 business bankruptcy filings and a total of 1,219,132 non-business filings just that year. This goes to show that there are so many people in our country today who are struggling with debt, and looking for whatever way they can find to make their way out. Before making the decision to file for bankruptcy, it is important to have a general understanding of what it entails. If you are weighing the option, please use this website to help you find a bankruptcy lawyer in your area today to discuss your questions and concerns further!

Bankruptcy, in a nutshell, is a legal process designed by the government to allow both consumers and businesses to attack their debt and establish a plan of action to eliminate or pay back some of what is due to creditors. How this is determined largely depends on what type of debt you are in and the possibility of you being able to ever pay it off. Because of this the government gives the people an option of either debt reorganization or elimination. If you are an average consumer, you will likely file for either Chapter 7 or Chapter 13 bankruptcy, unless you fall under a small category of people who would file for Chapter 11 which is designed primarily for businesses.

Chapter 7 bankruptcy is the option used for those who are buried deep in debt and see no possible way of getting out. Categorized as the "debt elimination" option, Chapter 7 allows for the individual to liquidate some of their property so that their debt can be paid down. Property liquidation allows for a large majority (if not all) of your unsecured debt to be eliminated. Property liquidation does not mean that you will lose everything that you ever owned; there are exemptions from bankruptcy that protect certain things from being liquidated that you may need for everyday life.

This would include a car, household furnishings, and your clothing; though many of the "extras" you own will be used to help bring down your debt. When it comes to your secured debt, such as what you owe on your new car loan, bankruptcy will give you a few different options. You may decide that you want to continue making payments or that you want the creditor to repossess the car to bring down the amount you owe significantly. Under this option, is important to realize that not all debt qualifies for Chapter 7 such as your college loans or medical bills. Please talk to an attorney to discuss these specifics.

Chapter 13 is considered to be the repayment plan, which is the option that is chosen for those who have some form of income and will be able to repay their debt in more reasonable increments. Chapter 13 is an agreement that you will faithfully make the specified payments as determined by the court over the course of the next three to five years to pay off your debt. The court will take into consideration the amount of debt you owe as well as your current income to decide what the minimum requirement will be.

If you are struggling with debt at this time, contact a bankruptcy attorney in your area to help you demine the best possible course of action for you!