A bankruptcy attorney can explain the applications of the new bankruptcy laws. You need to know how the bankruptcy code regulates the bankruptcy proceedings. An attorney can help you understand which chapter you may file under, what bills can be eliminated, how long payments may be extended, what possessions can be kept, and all other details regarding the bankruptcy case.

The relevant law to consider is the Bankruptcy Code, which defines and outlines the procedures involved in filing for bankruptcy under each chapter.

The two most common types of bankruptcy in the United States are Chapter 7 and Chapter 13. The first is available only to individual consumers while the latter is available to both individual debtors and business organizations. The first involves a liquidation of all nonexempt assets and properties, while the latter allows you to keep your properties in exchange for signing up for a repayment plan.

Dischargeability of Debts

If there is one thing you should take note of bankruptcy, it is that not all debts can be discharged. Keep this always in mind. Because you might think that you can get away with your debts scot-free after filing for bankruptcy only to find out later on that you are still obliged to pay for some certain non-dischargeable debts.

NON-DISCHARGEABLE DEBTS UNDER CHAPTER 7

Recent taxes

Trust fund taxes

Child or family support

Criminal fine or restitution

Accident claims involving intoxication

Unscheduled debts

Penalties payable to the government other than tax penalties

Student loans

Debts listed in prior bankruptcy where debtor was denied a discharge

NON-DISCHARGEABLE DEBTS UNDER CHAPTER 13

Debts for alimony, support, and maintenance

Debts for death or personal injury related to drunk driving

Debts for criminal fines and restitution

Most debts for student loans

Debts not covered by the plan

Installment debts maturing after the close of the plan

It is important to know what debts are dischargeable and what debts are non-dischargeable under any of these two bankruptcy types.

If you have substantial debts that are dischargeable under Chapter 13 but non-dischargeable under Chapter 7, then a Chapter 13 bankruptcy might be preferable to Chapter 7.

A sub-factor to consider in this is your eligibility for a discharge. The law states that a person who has received a Chapter 7 discharge in a case that was filed within six years is not eligible for a Chapter 7 discharge. In that case, the only other option you have is to file for a Chapter 13 discharge.

A bankruptcy attorney can help you get fast debt relief and give you the resources, services and expert advice to get your financial situation back in order. With the proper information in regards to the new bankruptcy laws you can avoid the hassles many people have to deal with because they did not take the time to do some research. Only you can decide what is best for your debt burden.