Everyone runs into financial difficulty at some point in their lives. One solution may be bankruptcy. At LaRowe Gerlach Taggart LLP, we will treat you with respect while we help you get to a better financial situation. We serve six Southern Wisconsin counties including Adams, Columbia, Dane, Juneau, Richland and Sauk. Our attorneys are dedicated to help you solve your financial challenges.
What is bankruptcy?
Bankruptcy is a process in which a person in debt (debtor) can receive a discharge. A discharge is a release from personal liability from specific debts and prohibits creditors from ever taking any action against the person in debt to collect those debts.
What is the purpose of bankruptcy?
A fundamental goal of bankruptcy is to give debtors a financial “fresh start” from burdensome debts. The Supreme Court has said, “It gives to the honest but unfortunate debtor… a new opportunity in life and a clear field for future effort, unhampered by the pressure and discouragement of preexisting debt.”
Are there different types of bankruptcy?
Yes, there are six basic types of bankruptcy cases. The most common are Chapter 7 and Chapter 13.
What is a Chapter 7 bankruptcy?
Chapter 7 bankruptcy is known as a Liquidation and is designed for debtors in financial difficulty who do not have the ability to pay their existing debts.. This is an orderly, court-supervised procedure by which a trustee takes over the assets of the debtor’s property, reduces them to cash and pays the creditors. A debtor may be able to keep some personal items and certain exempt property.
What is a Chapter 13 bankruptcy?
Chapter 13 is the process of creating a repayment plan to pay off creditors in three to five years. Usually Chapter 13 allows a debtor to keep his or her property, but the debtor must earn wages or have some other source of regular income in order to make repay the debt they owe. The repayment plan is overseen by a trustee who will collect the payments from the debtor, pay the creditors and make sure the debtor lives up to the terms of the repayment plan.