If you live in Naperville and find yourself falling behind on debt, it’s time to consider bankruptcy. The right attorney can stop creditor harassment, put an end to foreclosures and repossessions, and help you work towards a fresh start. That’s where Chicago Bankruptcy Clinic comes in. We’re ready to discuss your debt and explain which option will work best for you.
Filing for Bankruptcy in Naperville
Perhaps, like most Americans, even hearing the word “bankruptcy” conjures up anxiety. However, many people have found that bankruptcy can help them turn the page on their debt and end the stress of constantly having to owe creditors. If you’re falling behind on your monthly bills, or you’re trying to keep up with your debt but just can’t, bankruptcy may be right for you.
Bankruptcy also helps with the following:
- Putting a stop to creditor phone calls and letters
- Ending foreclosures and repossessions
- Stopping wage garnishments
- Addressing creditor judgments and lawsuits
- Repairing and rebuilding your credit
What’s The Difference Between Chapter 7 And Chapter 13 Bankruptcy in Naperville?
The type of debt you have, as well as how you want to handle it, will determine whether a Chapter 7 or Chapter 13 bankruptcy is best for your situation. Our firm will review your debt and other critical information to help you decide.
Chapter 7 Bankruptcy
In a Chapter 7 bankruptcy, property and assets are sold by the bankruptcy trustee to pay off as much debt as possible. For that reason, Chapter 7 is often referred to as a liquidation bankruptcy. It’s a good choice for debtors with unsecured debt – that is, debt that’s not backed by collateral. Chapter 7 can help you clear all or most unsecured debt, such as:
- Credit card bills
- Medical bills
- Utility bills (electric, water, etc.)
- Unsecured judgments
- Collection agency debts
- Personal loans
Not all debts can be discharged in a Chapter 7 bankruptcy. For example, student loans and child support cannot be cleared, nor can most taxes or traffic tickets.
Some property does not have to be liquidated. This property is considered exempt. It includes small items that have little or no liquidation value, such as household appliances, furniture, and clothing. Homes and vehicles may also be exempt, provided these assets don’t exceed the exemption limit. But if you want to keep your home or car, you will have to stay current on your payments.
Not all debtors will qualify for a Chapter 7 bankruptcy, due to income restrictions. To be eligible, a debtor has to make less than the median household income in their area. However, if Chapter 7 is not an option for you, Chapter 13 might be.
Chapter 13 Bankruptcy
This is a potential option if you don’t meet the requirements of Chapter 7 bankruptcy. It’s also a good choice if your objective is to reorganize and pay off your debt instead of liquidating it. Debtors who file for Chapter 13 bankruptcy have to propose a 3-5 year repayment plan for their debt, and stick to it if the plan is approved. Provided all payments under the plan are made, the bankruptcy is discharged and the debtor can keep his or her property.
A bankruptcy trustee will review the proposed payment plan, and creditors also get to consider it. The plan then heads to a confirmation hearing where the judge will examine it. If approved by the court, the debtor can start making payments under the plan.
The debtor has to stick with the reorganization plan and make sure all payments are made on time. Missing a payment could allow the creditor to resume collection efforts.
Understanding The Automatic Stay
If you file for either Chapter 7 or Chapter 13 bankruptcy, the court will enter what’s called an automatic stay. This stay prevents creditors from commencing or continuing any actions against you to collect on the debt. Those actions include:
- Wage garnishments
- Creditor lawsuits
- Collection letters and calls
The automatic stay can be lifted in some cases, and if so, your creditors can continue collections or seize assets. For example, if the stay is lifted, your creditor might be able to foreclose on your home or repossess your vehicle. The automatic stay will also be lifted if the bankruptcy is dismissed. Our firm can contest creditor motions to lift automatic stays and can help with issues that may result in a dismissal of the bankruptcy.
Why You Can Count On Chicago Bankruptcy Clinic
Our firm will review your debt, along with income and other key information, to help you choose between Chapter 7 and Chapter 13 bankruptcy. You may want to keep certain assets instead of liquidate them, or you might want to know more about debt reorganization plans. We can answer any questions you have, walk you through the bankruptcy process, and help protect your rights in the event your creditors violate the law.
Contact Our Naperville Bankruptcy Attorney
We understand the stress that comes with debt, but we also know you’re ready to move past it. Give Chicago Bankruptcy Clinic a call today. We will schedule your confidential consultation and get started on your case.