Federal Law always has opened choice for debtors to make their own decision when they are necessary to filing for bankruptcy from the financial problem when their business is in the end of the road. Apply on Chapter 7 bankruptcy as known as liquidation bankruptcy is the simple and common way to clear the problem but Chapter 13 bankruptcy, reorganization bankruptcy is for the others who do not want to give up. It allows debtors to keep their own property by making the agreement to pay their debt monthly over the course of three or five years which give more benefits to debtors and not appreciated creditors. For the example, it can be restructured by reducing the price following to the market value and lower the monthly payment by extend the payment period to 60 months which helps debtors to still keep their car and creditors have no choice but at least they still get their money.
Although filing for bankruptcy may have advantages for debtors who have no way out but it is not available to everyone. The person who have had their debt discharged in Chapter 7 within past eight years cannot re-file the bankruptcy and for Chapter 13 is six years. In case debtors have many shot time income, it would be not allow to filing in a liquidation bankruptcy, reorganization may be an option that it forces. For the Businesses that have not enough money but want to stay in business, they have their choice to file a Chapter 11 bankruptcy which is like a personal bankruptcy by obtain protection from creditors while they put a repayment plan together. Some debt can be reduced and restructured to give a chance in business at achieve profitable.
Although the debtors can fill for bankruptcy under Chapter 7, 13 or 11 by themselves but many debtors would like to use the service of bankruptcy lawyer to do the filing instead since they much face with a huge number of federal laws and regulation. Any step of the process requires carless because it would bring the result in the court refusing and involve to discharge the debtor’s liabilities to avoid disastrous.