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Financial crises happen to good people - especially now!

Bills quickly become overwhelming due to a medical emergency, job loss, and other unforeseen, uncontrolled circumstances.  COVID-19 has come out of nowhere and hit all of us hard.  No one knows when, or even if, things will get back to 'normal.'

Business has evaporated, tens of millions of jobs lost.  Mortgages, rent, and bills are going unpaid, and chances are you're not getting a government bailout.  What do you do?

People are often embarrassed and confused in these situations, refusing to seek help until the problem seems insurmountable.  Please know that you're not alone - you're in good company of millions.  And we can help.

Most people don’t know that our Constitution provides for bankruptcy, because our founders knew that there are times when we need a Constitutional Fresh Start (sm).  We'll help you get yours.

The Automatic Stay

At the moment a bankruptcy case is filed, all creditors are prevented by Federal law from contacting the debtor.  Violation of the automatic stay is viewed as contempt of court, and there are serious penalties for creditors who refuse to honor the stay.  The automatic stay is in effect until the conclusion of the case.

Chapter 7

Chapter 7 is the most popular type of bankruptcy.  In a Chapter 7 case, an officer of the Bankruptcy Court, called the Trustee, technically takes control over all of the filer’s property, in order to determine whether there are ‘excess assets’ that could be used to satisfy some of the creditors. 

In most cases, all of the filer’s property is exempt from being used by the Trustee.  A short time after the case is filed, the debts are discharged and the “fresh start” begins.

Chapter 13

Due to the 2005 changes in bankruptcy law, more and more people are filing Chapter 13 cases.  This is a more complicated case than a Chapter 7 case, but there can be significant benefits outweighing the complications.

In general, ‘excess income’ beyond that required for living expenses is shuttled to the Trustee, who pays creditors according to a schedule, which requires each creditor to be paid at least the amount it would receive in a Chapter 7 case.  The schedule can be spread over several years.

Some of the benefits of Chapter 13 are that property that would be considered ‘non-exempt’ in a Chapter 7 case can be kept, and secured debts that are ‘under water’ can be forced to the market value of the property that secures them.  This allows many people to keep their houses, vehicles, and other property that would be sold in a Chapter 7 proceeding.

Chapter 11

Chapter 11 reorganization allows businesses and individuals exceeding the asset and debt limits for the other chapters to reorganize their debts and remain in business.  The process is somewhat similar to the Chapter 13 process, but due to the size of the assets and debts involved, a creditors' committee has a large part in designing the reorganization plan.

If negotiations with your creditors fall through, we can help get you your Constitutional Fresh Start (sm).

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