When doing research about different bankruptcy chapters and options available for Georgia residents, this is what you typically find:
Chapter 7 - Liquidation under the Bankruptcy Code. Your assets are not protected and your unsecured debt is wiped out.
Chapter 13 - Restructuring under the Bankruptcy Code. Your assets are protected and you are put in a repayment plan.
Chapter 11 - For businesses and "high flying" individuals.
Chapter 12 - For Family Farmers and Family Fishermen.
Focusing your research on different Bankruptcy Chapters may not be helpful.
Doing research specifically on Bankruptcy Chapters may not help you because many aspects of the Bankruptcy Code interact together. So if you just focus on a specific bankruptcy chapter (Chapter 7, Chapter 13, Chapter 11, and so on…), you will miss how different provisions of the bankruptcy code work together. This type of approach can create a lot of confusion since the researcher may find overlapping or seemingly contradictory statements.
Let me give you a few examples.
Consider the following statement "Chapter 7 bankruptcy wipes out all my debt." This is not always a correct statement and can be very misleading, but I have found that most people believe that Chapter 7 bankruptcy wipes out all their debt. This is not the case. For example, if you are trying to keep a vehicle that you are financing, that car loan is not going be wiped out.
Here are some other incorrect conclusions one may make about Bankruptcy Chapters:
"You pay all your debt back in a Chapter 13 Bankruptcy." Not true.
"If you file a Chapter 7, you lose everything." Not true.
Focus on the benefits you need from a bankruptcy and let a professional do the rest. After all, you care about benefits that are available to you more than anything else, right?
Bankruptcy laws have two main benefits for a person considering filing for bankruptcy.
First Bankruptcy Benefit: Eliminating debt.
Second Bankruptcy Benefit: Protecting people from their creditors.
1- Eliminating Debt.
It is possible to eliminate debt in both in Chapter 7 and Chapter 13. Which one provides you with more relief depends on many factors, including your income, and the value of the assets you own.
2- Protecting your sanity and property from creditors.
If you are filing for bankruptcy, you want to make sure that you are protecting your assets. A proper selection of the type of bankruptcy is critical to accomplish this task.
We take pride in educating our clients about various bankruptcy and non-bankruptcy options. Give us a call at (678) 507-1590 to obtain a free consultation. It will save you a lot of time!