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Filing Bankruptcy in 2019: What You Need To Know

Bankruptcy law
  • Blog
  • Jill
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  • December 28, 2018

Filing Bankruptcy in 2019: What You Need To Know

If you are considering filing for bankruptcy, you are probably feeling overwhelmed.  Whether it is your business or your personal finances that are in arrears, no doubt your stress is rising as bills pile up.  Making the decision to file for bankruptcy can feel overwhelming, too. You might be asking yourself whether or not it is the best decision, and if so, how do you even start the process?  Speaking with an experienced attorney in this area is the first step in dealing with these concerns. A bankruptcy lawyer can advise you as to whether or not it is the right choice and can help you navigate through the paperwork and court process that follows.  Knowing what to expect can alleviate some of the stress associated with the process. Here is a brief overview of what you need to know if you plan to file for bankruptcy in 2019.


What Is Bankruptcy?

Bankruptcy is a legal means for people in debt to start over financially.  It is intended for people overwhelmed by debt who cannot realistically expect to pay it back.  There are many ways to end up in this situation: job loss, divorce, serious illness, or even just irresponsible spending.  Whatever the cause, people who consider bankruptcy have the shared experience of too many bills coming in and not enough income to pay them.  If you are trying to decide whether it is right for you, here is a good rule of thumb: if you cannot realistically pay off your debt in five years, it is a good option for you.


Chapter 7 

Chapter 7 is the designation for personal bankruptcy and involves liquidating some personal property to pay back the debts.  The creditor may repossess property that was paid for with an unpaid loan, or the court may decide that other personal property can be seized to repay debt.  Certain property, such as your home, car, clothes, and household furnishings are protected under Chapter 7. Unsecured debts, such as credit card debt, is wiped out.  At the end of Chapter 7, you may have parted with some of your property, but you will have an (almost) clean financial slate. Certain debts, such as student loans and tax payments, cannot be wiped out by bankruptcy.


Chapter 11 

Chapter 11 bankruptcy is most often used for businesses, although in some situations it can be used for personal bankruptcy.  The business can continue to operate during the bankruptcy process, protecting the business owner’s income stream. The court will reorganize the debt so that creditors will be repaid.  This repayment period lasts for 5 years. As in Chapter 7, certain property is protected from liquidation.



While it is a solution for many people, it is not a get-out-of-jail-free card for people with debt.  Filing for bankruptcy comes with a cost, both personal and financial. On a personal level, you must make public your entire financial life, from your income and expenses to your debts and assets.  The process itself can be time-consuming and stressful. Financially, you will have to pay court fees and, if you use a lawyer, legal fees. Once you have declared, your credit score will go down, making it harder for you to take out loans at a low-interest rate for years to come.

If your debts are simply too much to handle, filing may be the best option.  The attorneys at Bartifay Law Offices have years of experience in helping people to file for bankruptcy.  Call our office today to learn more about filing for bankruptcy in 2019.

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