A debtor considering bankruptcy must bear in mind that a bankruptcy stays on his or her credit report for up to 10 years, which can potentially make it difficult to get future credit. A debtor should also keep in mind that some debts must still be paid even if he or she files for bankruptcy. Accordingly, it is essential to contact an experienced bankruptcy attorney before making potentially life-altering financial decisions.
Learn More About Bankruptcy
If you are struggling with high debt, bankruptcy can be an effective means of getting that burden off your shoulders. At the Law Office of Mark A. Skelton, we help people get out of debt and stop harsh creditor actions by assisting them in filing for Chapter 7 and Chapter 13 bankruptcy relief. We serve clients from throughout the East Tennessee region. We offer excellent client service and personal, hands-on attention from a highly qualified bankruptcy attorney.
To learn more about bankruptcy, please review the information provided below or visit our bankruptcy practice area page.
To schedule your free initial consultation at our Rogersville, Tennessee, office with an experienced bankruptcy lawyer, contact us today online or by telephone at 888-899-5564. Allow us to discuss your circumstances and advise you of your available options for financial relief.
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Are you getting tired of creditor harassment? Are you being threatened with wage garnishment, foreclosure, repossession and other actions? Bankruptcy can put all of that to an end.
Filing for Chapter 7 or Chapter 13 bankruptcy can stop your creditors and allow you a fresh financial start. A knowledgeable bankruptcy attorney can help you achieve total debt relief.
Bankruptcy - An Overview
Bankruptcy is a legal vehicle that provides relief to individuals and businesses in serious financial trouble. Generally, the bankruptcy process assesses the debtor's assets and liabilities and provides a structure within which the debtor is allowed to keep exempt property while attempting to satisfy as many eligible debts as possible (according to an order of priority established by law). Remaining eligible debts are discharged. Certain debts, like domestic support orders, debt obtained by fraud and most tax debt, are generally ineligible for consideration in a bankruptcy case.
The traditional stigma of bankruptcy has faded for the most part, and it has been replaced by the view that bankruptcy is a fresh start after a time of financial trouble. Many bankruptcy debtors have experienced unexpected and extreme financial shock that is out of their control, caused by sudden events such as job loss, business failure, death, divorce or illness.
In such cases, filing bankruptcy may be the right answer. If you are facing serious financial challenges, contact Mark Albert Skelton, Attorney at Law in Rogersville, Tennessee, to schedule a consultation with an experienced bankruptcy attorney who can help you assess your legal options.
Bankruptcy laws are primarily federal, and bankruptcies are administered by the federal courts. However, the various states' consumer and commercial laws do play important roles in certain bankruptcy issues. In addition, each state has its own list of property exemptions.
Bankruptcy is an available option for individual consumers, businesses, farmers/fishermen and municipalities. There are two major bankruptcy types: liquidation and reorganization. For practical purposes, many debtors have so-called no-asset cases where all (or nearly all) of the debtors' property is exempt from the liquidation requirement and eligible debt is discharged without any property being sold.
Chapter 7 of the Bankruptcy Code governs liquidation bankruptcy. Chapter 7 filings are available to both individuals and businesses. Upon the filing of a Chapter 7 bankruptcy petition, the bankruptcy court issues an "automatic stay" that stops most collection proceedings against the debtor. A bankruptcy trustee is responsible for gathering the debtor's nonexempt property, if any, liquidating it and distributing the proceeds to the creditors in order of legal preference, with secured creditors being paid before unsecured ones. If there are not enough assets to cover all the debtor's liabilities, then the creditors of lowest legal priority may only be partially paid, or may be unpaid altogether.
For an individual consumer debtor, these remaining debts are discharged and no longer the responsibility of the debtor. That being said, there are certain types of debt that will survive a bankruptcy proceeding. These include domestic support obligations like child support and alimony, most tax debts and many student loans. For a business debtor, the liquidated business generally does not survive the bankruptcy, as its assets have been sold and it is no longer profitable.
A reorganization bankruptcy is more appropriate where there is ongoing income that can be used to pay creditors, at least in part. Reorganizations are governed by several chapters of the Bankruptcy Code. Chapter 11 generally controls reorganizations for individual debtors with high debts or for business entities. Chapter 13, on the other hand, generally covers individual consumer debtors with lower debts. Farmers and fishermen can file for reorganization under Chapter 12, while municipalities seeking debt reorganization should seek assistance under Chapter 9.
As in a liquidation bankruptcy, filing for reorganization generates an automatic stay of most collection activity. The debtor then develops a plan to repay debts over a three- to five-year period through a bankruptcy trustee. At the successful conclusion of the payment plan, if certain conditions are met, remaining dischargeable debt is cancelled. If the debtor fails to make payments under the plan or fails to make alimony, child support or certain tax payments as well as his or her scheduled plan payments, the court may either dismiss the case or convert the reorganization to a liquidation proceeding.
In addition to bankruptcies filed voluntarily by debtors, creditors may have a legal remedy through "involuntary bankruptcy" petitions under Chapters 7 or 11. If either there is a minimum level of debt present or there are a minimum number of creditors, creditors can file a bankruptcy petition against a debtor (regardless of the debtor's wishes) to ensure that assets are distributed fairly among creditors through the bankruptcy process. Involuntary bankruptcy proceedings must be meritorious; penalties for filing improper or malicious petitions can be steep.
Speak to a bankruptcy lawyer
Bankruptcy law can benefit debtors and creditors alike, depending on the circumstances. If you feel that bankruptcy may be appropriate for your financial situation, contact Mark Albert Skelton, Attorney at Law in Rogersville, Tennessee, to schedule a consultation with a skilled bankruptcy attorney.
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