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If an individual or company files for bankruptcy because they are not in a position to pay off their creditors and debt, they can file for bankruptcy protection under the United States Bankruptcy laws. There is difference of procedure between the filing for an individual and a company. In the case of an individual, while filing such a plea the person may have to include either a cancellation of majority of their debts and/or selling some of their possession. It could also be a pre-arranged plan to clear some of the debts owed by others. For a company, it has to include all or part of relief debts and contracts to continue with its business. Otherwise the business has to be dissolved and all their properties sold to pay the debts owed by public or other entities. Such occasions might give rise to many questions -- both to individuals and to businesses -- that are asked to bankruptcy lawyers online. This article provides answers to some of the most commonly asked questions about such issues : What is meant by Chapter 13 Bankruptcy protection?
Its purpose was to protect a majority of an individual’s important property which might include home and vehicles. As per Chapter 13 Debt Repayment Plan the total amount of debts and payments deadline can be overlooked and negotiated to provide the defaulter some extra time to meet his/her obligations of repaying the bills. What is meant by Chapter 7 Bankruptcy protection?
Under Chapter 7 bankruptcy protection, the individual applying for it is sometimes allowed to eliminate most of the debts and the person can start afresh with a clean slate. While apparently it seems like the best option available, the flip side of this protection law is that the individual might lose his property and get a lower credit score in future. In the state of Colorado, if someone files for bankruptcy protection, does the person have to attend the 69 hearing with the creditor when the latter has not filed a motion for relief from the automatic stay?
In such a case it would most likely be deemed a violation of the automatic stay of bankruptcy for the creditor to carry out a 69 hearing. Hence, it means that the individual does not have to attend the 69 hearing. Under Chapter 13 Bankruptcy protection what happens to the debts of an individual after the agreed-on five year plan where the debts remain unpaid to the creditor?
Under this section some of the debts will be deemed dischargeable, but child support, IRS debt and majority of the student loans will not come under its purview. Regarding credit cards, debts like personal loans, pay day loans, vehicle repos and medical bills may be dischargeable and debts will be foregone at the end of this plan. There are merits and demerits of filing for individual or LLC bankruptcy protection. There are many other types of bankruptcy protection and it is always better to ask a bankruptcy lawyer for expert advice on this matter before taking any decisions, in order to ensure that your decisions are legally correct, depending on the particulars and details of your circumstances.
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