When a person is thinking about filing for bankruptcy or have a lot of debt, they may not know the questions to ask.  They normally will head to a bankruptcy attorney who will sell them a bankruptcy.  A bankruptcy may or may not be necessary.  After deciding a bankruptcy is right for you, it can still be confusing to know which type of bankruptcy is right for you.  At Myers & Eichelberger, we are committed to making sure you only choose the options that are right for you.

There are four types of bankruptcy, of which we will focus on two.  I will list them in reverse order of how often they are filed.

Chapter 12 — Family farmers and fishermen only

Chapter – 11 A reorganization; mainly used by  businesses and individuals with very large debt

Chapter 13 — Also a reorganization; primarily used by indiviudals to pay back a portion of the debt over normally 5 years and is based on their current income

Chapter 7 – is a liquidation of the debt; this is the most common; it normally requires a person to release the property, unless it is exempt; this property is then sold to pay off the creditors

Choosing the correct chapter for you and your unique position is very important.  For example, if you own a house that you wish to keep and you are in Orange County, a chapter 13 may be beneficial to you as Orange County has a program that you may be eligible for that may reduce your mortgage payment.  It is important that one does not just decide to file bankruptcy or which chapter based on an emotional decision to a desire to “be done with it”.

Instead, this decision will impact you for many years and you want to ensure that it is one that you can live with for a long time. At Myers & Eichelberger, we are 100% committed to helping people through this bad economic time whether that means filing bankruptcy or not filing bankruptcy.  Bankruptcy is a tool in our toolbox, but it may not be your only option.  Call us at 1-888-ME-HELP-YOU or visit our office location to speak to us about your unique situation.