Which Filing For Bankruptcy Is Right For You?
Cincinnati chapter 7, Cincinnati chapter 11, Cincinnati chapter 12 and Cincinnati chapter 13, are not part of the travel log diaries of some wayward adventurer that never got across the bridge into Kentucky. They are not chapters of the Boy scouts or Moose Lodge either. These are different forms of bankruptcy that can be filed. They are very different in nature but easily understood. Each form of bankruptcy is organized for specific situations and allows for different things.
Emily had a pretty bad decade that destroyed her financial security. She was laid off and started paying bills using credit cards knowing that her financial situation would improve. She couldn’t afford the Cobra payments to maintain her health insurance and then had a car accident and racked up medical bills. Her assets were few, a car and small boat, and a few pieces of art. Her lawyer suggested she file for chapter 7 since most of her debt was dischargeable. She didn’t have a lot of student loans, nor was her debt obtain through fraud or criminal behavior. She wasn’t trying to discharge a criminal fine or child support and alimony. Her assets would be sold and the debts would be paid from the proceeds. Since she didn’t have a lot of assets to protect she would be able to clear the debt and begin again.
Tom has a lot more to lose so he doesn’t want to consider Emily’s path. Tom has a good work and consistent influx of capital. He made several bad deals and got stuck holding worthless goods. His debt isn’t mammoth, the unsecured debt is less then $200,000. He would like to keep his assets and property so his lawyer recommends he file for chapter 13. He will make regular contributions to a trustee who will oversee the payment to the creditors at anything from 10 to 100 percent of the debt over several years. Tom’s brother Dale is also struggling. He owns a farm and is struggling to pay off debt he accrued after three years of drought and bad harvests so he will file under the chapter known as 12. This is similar to thirteen, but is designed for farmers so they can retain their property and pay down their debt.
Ellen is the CEO of a medium size business that suffered in the recession. The company has debts too large to file under 13. It also has a new operational group and a strong revised business plan. By filing under the chapter known as 11, the company will be able to continue running and reorganize itself. A trustee will be appointed and a creditors committee will determine if the new plan holds promise. The debts will be paid through liquidated assets or through future monies the company earns.
There are many forms of bankruptcy designed to help businesses and individuals get a second chance. In a volatile market more and more people are considering their options under the bankruptcy laws.