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Written by Canterbury Law Group

How Long Does Chapter 11 Take?

How Long Does Chapter 11 Take?

Bankruptcy can take varying amounts of time to complete but most Chapter 11 bankruptcy plans are complete within six months to two years. read on to learn more.

The fee for filing Chapter 11 bankruptcy is $1,717 but you can reckon on spending in excess of $10,000 on legal fees. Business owners who file for Chapter 11 bankruptcy will discover it is not a simple process.

Chapter 11 Versus Chapter 13

Both plans allow for business reorganization but with a Chapter 11 bankruptcy, a trustee does not always have to be appointed. If they are the review the plan or reorganization and make recommendations to the court, They also undertake the responsibility of collecting payment as well as the distribution of payments. To qualify for Chapter 13 your bills cannot be in excess of $1,184,200 in secured debt, and $394,725 in unsecured debt.

Businesses who are struggling need more time to get back on their feet. Chapter 11 bankruptcy can assist in this. it all starts with a the filing of a detailed petition. Chapter 7 progresses quickly, since creditors do not get to vote on the plan of reorganization. But Chapter 11 requires many court hearings and that is why it can take in excess of a year.

Source: https://www.debt.org/bankruptcy/chapter-11/

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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How Does Chapter 11 Bankruptcy Work?

How Does Chapter 11 Bankruptcy Work

Chapter 11 bankruptcy commences with a petition filed to the court and with the assignation of a case number. The automatic stay then begins and a meeting is scheduled with all the creditors. Depending on the circumstances of the person filing for bankruptcy, a reorganization or liquidation are the primary options available. Read on to learn more.

Reorganization

Chapter 11 bankruptcy allows a filer to perform a reorganization of their financial affairs. The bankruptcy plan explains how debts will be met in the future and offers the filer the opportunity to renegotiate and restructure the manner of how they will pay back their creditors.

U.S. Bankruptcy Code rules state creditors are divided into certain classes:

  • Creditors whose debts are secured by a property liens
  • Unsecured priority claims are given priority for their unsecured debts to obtain money from the plan of repayment
  • Unsecured claims that are non-priority are only met when the above classes have been satisfied

Sometimes, those who fall into the last category will assemble a creditors’ committee to try and obtain payment. Security holders with equity also have a claim on the company and may be paid at any time (or not paid at all.) Creditors may also object to the class they have been assigned by the filer. Only the filer can file a plan of reorganization in the first 120 days once the case has been filed with the U.S. Bankruptcy Court. In the case the filer is a small business they are allowed 180 days. After that, a creditor may file a plan for reorganization if the debtor is yet to have filed a plan or has filed a plan that does not meet the acceptance of its creditors.

The plan of reorganization must include a statement of written disclosure that gives information regarding the business affairs of the filer so creditors can make educated decisions regarding the reorganization plan. In the case of a small business the court may decide the plan includes all the relevant information saying the statement of disclosure will not be required.

Proof of claims will be filed by creditors. These claims will contain the money they are owed and it maintains their rights but they still have to provide proof to the courts explaining the validity of their claim. Those with valid claims vote on whether they will accept the plan of reorganization. Court approval and the vote of the creditors are mandatory. The approval of the court requires at least one of the classes of impaired claims will vote in favor of the bankruptcy reorganization plan. Bankruptcy Code rules say a total class of claims accept a plan if at least two-thirds of the creditors of the total amount of the claims and more than fifty percent of the number of claims allowed in the class.

Confirmation

A confirmation hearing will convene so the court can make a determination to approve the plan. The court will ensure the plan is in line with bankruptcy laws and requirements. Once it is confirmed, the Chapter 11 bankruptcy case may be closed until the plan is completed, allowing the filer to save money on fees and prevents the need to file reports on a monthly basis.

In most Chapter 11 cases, a bankruptcy trustee us not appointed. The filer acts in a manner a trustee would in a Chapter 7 or Chapter 13 proceeding. Control is maintained by the filer over their business and finances. They are also responsible for the examination and objection claims from creditors as well as filing tax returns, accounting and meeting the additional duties and requirements of reporting. The administrative side of the Chapter 11 bankruptcy filing is managed by the U.S. Trustee and ensures the debtor does that is required. That said, a Bankruptcy trustee may be appointed when the debtor does not want to act as the debtor in possession. The court may also appoint a trustee to manage the operations if the court has good reason or suspects incompetence or fraud.

Liquidation

This is an option in a Chapter 11 bankruptcy. A plan would shut down the operations of a filer and sell the assets that remain so the creditors can have at least received a portion of the debts owed. Liquidation may be better under Chapter 11 than Chapter 7 as the debtor who is in possession and their creditors have greater say over the execution of the Chapter 11 plan.

Source: https://upsolve.org/learn/what-is-chapter-11-bankruptcy

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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Chapter 7 vs. Chapter 11 Bankruptcy Differences

Chapter 7 vs. Chapter 11 Bankruptcy Differences

When dealing with Chapter 7 and Chapter 11 bankruptcies, the shareholders of the companies doing the filing are not likely to see returns on their investments. That said there are still some major differences. Read on to learn more.

Chapter 7 Bankruptcy

Also called “Liquidation Bankruptcy” At this stage firms are past the stage of reorganization and have to sell off any assets that are not exempt to satisfy creditors. Debts are collected according to “absolute priority” rules and a trustee make sure assets are sold and the funds distributed to the appropriate creditors. To obtain Chapter 7 relief a debtor may be an individual, a corporation or a small business. They are not allowed to proceed with bankruptcy if they have had a previous bankruptcy application dismissed within the previous 180 days should they not have made an appearance in court. When assets are sold the remaining debt is usually forgiven.

Chapter 11 Bankruptcy

Also called a “reorganization” or sometimes a ‘rehabilitation” bankruptcy. Available for nearly everyone, there is no debt limit and no income requirements. It is more complex and generally more expensive. It permits the firm to reorganize their debt by contacting its creditors to change the loan terms. It is initiated with a petition filing and according to The Small Business Reorganization Act of 2019 makes this form of bankruptcy more accessible for small businesses. To quote the act: “defined as entities with less than about $2.7 million in debts that also meet other criteria,”  it goes on to state: “imposes shorter deadlines for completing the bankruptcy process, allows for greater flexibility in negotiating restructuring plans with creditors, and provides for a private trustee who will work with the small business debtor and its creditors to facilitate the development of a consensual plan of reorganization.” Recently the Chapter 11 Subchapter V debt limit has been increased by President Donald Trump to $7,700,000 for cases filed following the CARES act.

Chapter 7 Vs. Chapter 11

Both Chapter 11 and Chapter 7 bankruptcy requires a trustee who will supervise the assets belonging to the debtor to ensure the continuation of business. In Chapter 11, debt is not absolved but if successful it is expected the business will continue to operate. When that is not possible the next step is liquidation and Chapter 7 bankruptcy.

Source: https://www.investopedia.com/ask/answers/differences-between-chapter-7-and-chapter-11/

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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What Is Chapter 11 Bankruptcy?

What Is Chapter 13 Bankruptcy

Chapter 11 bankruptcy is normally associated when large organizations need bankruptcy assistance as it lets them restructure their financial arrangements for a maximum return to their owners and creditors. Read on to learn more.

It begins with going to a bankruptcy court and filing a petition. Normally, this is done voluntarily and it is up to the debtor to take the initiative and look for bankruptcy belief. On occasion, creditors will band together to file a Chapter 11 petition on am involuntary basis. Normally filed at where the business is located but can also be where the debtor is domiciled. As Chapter 11 bankruptcies are usually filed by partnerships, corporations and LLC’s. There are risks associated with Chapter 11 bankruptcy so many people choose to file Chapter 7 or 13 bankruptcy.

What Happens Before A Chapter 11 Plan Is Proposed

A Chapter 11 case has no limits on its duration. They can be concluded within a few months but often takes one to two years to complete. Normally no trustee us appointed and the debtor keeps operating their business. A trustee can be appointed by the bankruptcy court if there are suspicions of incompetence, fraud, dishonesty and mismanagement.

Bankruptcy Court Has Control Over Major Decisions

In Chapter 11 cases, the debtor does not always have control over the sale of assets and other aspects of the business such as:

  • Retention of and the payment of expenses and fees to attorneys
  • Entering into agreements and contracts for vendors and licensing
  • Expanding or closing business operations
  • Secured financial arrangements including mortgages allowing the debtor to obtain money once the case has filed
  • Entering into the breaking of a lease for personal or real property

Role Of Creditors

Shareholders, creditors may be in favor or oppose actions requiring court approval. The court will consider input from creditors in making a decision before deciding how to go forward. Regarding unsecured creditors, their committee can retain professionals and attorneys to help at the expense of the debtor.

Reorganization Plans

Normally, the debtor has the right for 4 months once filing for Chapter 11 to suggest a plan for reorganization. Once showing a good cause, the court may extend the “exclusivity period” that files a Chapter 11 plan up to 18 months following the petition date. Once this time has expired the proposing or the competing reorganization plans can be proposed. This is not common in Chapter 11 cases. The Chapter 11 plan permits the debtor to restructure their financial affairs. In essence, it is a contract between debtors and creditors to meet financial obligations. Occasionally, the plan will provide for immediate and total payment. In other circumstances, creditors may vote or the acceptance of a plan.

Confirmation

When confirming a Chapter 11 plan, the bankruptcy court has to find certain requirements must be met such as:

  • The plan has to be fair and equitable in that secured creditors are paid their collateral value. A creditor is considered secured if a mortgage is in place against real property or a personal property lien. The owners of the debt may not retain anything because of their equity interests unless all their obligations have been met.
  • The “best interests” in Chapter 11 says all creditors receive as much as they would under a proposed plan like in a Chapter 7 liquidation.
  • The court has to be satisfied the plan has been made in good faith and is legal.
  • The court has to be satisfied the plan is feasible and has a high chance of success.

Does it Work?

Studies suggest between ten and fifteen percent of reorganizations under Chapter 11 are successful. Most are converted to chapter 7 or just dismissed and that requires the approval of the bankruptcy court. Included in Chapter 11 laws are special guidelines to speed up Chapter 11 cases for small business debtors and single-asset real estate ventures.

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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Written by Canterbury Law Group

What Does Filing For Bankruptcy Do?

What does Filing For Bankruptcy Do

If you are facing serious debt problems, filing for bankruptcy can assist. It prevents most collection actions, and lawsuits (with a few exceptions). It also eliminates many types of debt. But you will still have to pay your student loans (unless you can prove a hardship) and arrearages for child support, alimony, and most tax debts. Read on to learn more.

Prevent a Foreclosure, Repossession, or Eviction

Once filed, the court puts in place an order called the automatic stay. The automatic stay will stop all of these actions as long as they are still pending.

  • Evictions. An eviction still in litigation will come to a halt after a bankruptcy filing. But the stay will likely be temporary. Keep in mind that if your landlord has an outstanding eviction judgment against you, a bankruptcy will not help most situations.
  • Foreclosure and repossession. Although the automatic stay will stop a foreclosure or repossession, filing for Chapter 7 will not help you keep the property. However, Chapter 13 has it is possible you will be allowed to catch up on past payments so you can keep the asset.

How quickly your debt will get wiped out will depend on the chapter you file:

  • Chapter 7 bankruptcy. This chapter takes an average of three to four months to complete.
  • Chapter 13 bankruptcy. If you file for Chapter 13 rather than Chapter 7, you will likely have to pay back some portion of your unsecured debts through a three- to five-year repayment plan.

Wipe Out Secured Debt

If you cannot afford a payment that you secured with collateral—such as a mortgage or car payment—you can wipe out the debt in bankruptcy. But you will not be able to keep the house, car, computer, or other item securing payment of the loan

Here are some of the things that Chapter 13 can do.

Stop a mortgage foreclosure. Filing for Chapter 13 bankruptcy will stop a foreclosure and force the lender to accept a plan that will allow you to make up the missed payments over time (you’ll also have to stay current on your regular monthly payments). To make this plan work, you must be able to demonstrate that you have enough income to support such a repayment plan.

Allow you to keep property that is not protected with a bankruptcy exemption. No one gives up everything that they own in bankruptcy. You are allowed to protect (exempt) items you will need to work and live using bankruptcy exemptions. A Chapter 7 debtor gives up nonexempt property, but not a Chapter 13 filer. This does not mean that you get to keep more assets, however. You will need to pay the value of any nonexempt property to your creditors in your repayment plan.

What Bankruptcy Can’t Do

Prevent a secured creditor from foreclosing or repossessing property you cannot afford. A bankruptcy discharge eliminates debts, but it does not eliminate liens. A lien allows the lender to take property, sell it at auction, and apply the proceeds to a loan balance. For example, if you file for Chapter 7 bankruptcy, you can wipe out a home mortgage; however, the lender’s lien will remain on the home. As long as the mortgage remains unpaid, the lender can foreclose on the home (once the automatic stay lifts, of course).

Eliminate child support and alimony obligations. Child support and alimony obligations survive bankruptcy, so you will continue to owe these debts in full, just as if you had never filed for bankruptcy. And if you use Chapter 13, you will have to pay these debts in full through your plan.

Eliminate student loans, except in extremely limited circumstances. Student loans can be discharged in bankruptcy only if you can show that repaying the loan would cause you “undue hardship,” which is a very tough standard to meet. You must prove that you cannot afford to pay your loans currently and that there’s truly little likelihood you can do so in the future.

Eliminate most tax debts. Eliminating tax debt in bankruptcy is not easy, but it’s sometimes possible for older unpaid tax debts.

Eliminate other non-dischargeable debts. The following debts are not dischargeable under either chapter:

  • Debts you forget to list in your bankruptcy papers (unless the creditor learns of your bankruptcy case)
  • Debts for personal injury or death due to intoxicated driving, and
  • Fines and penalties imposed as a punishment, such as traffic tickets and criminal restitution.

If you file for Chapter 7, these debts will remain when your case is over. In Chapter 13, you will pay these debts in full through your repayment plan.

Debt related to fraud might or might not get eliminated. A fraud-related debt will not be discharged if a creditor files a lawsuit (called an adversary proceeding) and convinces the judge that the debt should survive your bankruptcy

Source: https://www.nolo.com/legal-encyclopedia/chapter-7-13-bankruptcy-limits-benefits-30025.html

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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Advantages And Disadvantages Of Filing For Bankruptcy

Advantages And Disadvantages Of Filing For Bankruptcy

Often bankruptcy is the best course of action but let us review some of the advantages and disadvantages. Read on to learn more.

Chapter 7 Bankruptcy

This is a liquidation bankruptcy that wipes out the majority of your unsecured debts including medical bills and credit cards without the necessity of a repayment plan. Certain income requirements must be met. if you earn in excess of theses requirements, you will need to look at Chapter 13 bankruptcy.

An order known as an “Automatic Stay” prevents the majority of creditors from pursuing collections. In additional bankruptcy trustee is appointed. They will review your papers and documents and our responsible for selling nonexempt property that will pay back your creditors. If you do not have any qualifying assets, the creditors will not receive anything. Chapter 7 bankruptcy is a good option when you have little to no assets and have a low income. it can also be advantageous to those whose discharged debt is greater than the value of the property sold.

Consider the following:

  • Businesses and individual may file
  • Your income must be under the limit for the Chapter 7 means test
  • it takes three to four months to receive a discharge under normal circumstances
  • The trustee has the authority to sell nonexempt property to satisfy creditors
  • It does not allow the removal of insecure junior liens via lien stripping
  • Tangible personal property can reduce the principal loan balance on secured debts
  • There is no mechanism to make up missed payments to avoid repossession or foreclosure

Chapter 13 Bankruptcy

This is a reorganization bankruptcy for debtors with a regular source of income who have excess over every month and pay part of their outstanding debts as per a plan for repayment. Most filing Chapter 13 are in excess of the Chapter 7 financial requirements – but there are many advantages to Chapter 13 bankruptcy. In Chapter 13 bankruptcy you keep your property but you’ll have to pay creditors an amount equal to the value of your nonexempt property. When you need debt relief but do not qualify for Chapter 7 and when you have debts that are non-dischargeable debts that you can pay off over a three to five year period you can without losing your property.

Consider the following

  • Only individuals can file including sole proprietors
  • Cannot have in excess of $419,275 of debt that is unsecured and $1,257,850 of debt that is secured
  • Discharge only occurs on completion of payment plans
  • Debtors Keep All Property But Must Pay Unsecured Creditors an Amount Equal to Value of Nonexempt Assets
  • Allows the removal of unsecured junior liens from real property by means of lien stripping
  • It allows for reducing the principal loan balance on debts that are secured

Source: https://www.nolo.com/legal-encyclopedia/what-is-the-difference-between-chapter-7-chapter-13-bankrutpcy.html

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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Written by Canterbury Law Group

Difference Between Chapter 7 and Chapter 13 Bankruptcy

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Here are some of the major differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy. Read on to learn more.

Chapter 7 Bankruptcy

This is a liquidation bankruptcy that wipes out the majority of your unsecured debts including medical bills and credit cards without the necessity of a repayment plan. Certain income requirements must be met. if you earn in excess of theses requirements, you will need to look at Chapter 13 bankruptcy.

An order known as an “Automatic Stay” prevents the majority of creditors from pursuing collections. In additional bankruptcy trustee is appointed. They will review your papers and documents and our responsible for selling nonexempt property that will pay back your creditors. If you do not have any qualifying assets, the creditors will not receive anything. Chapter 7 bankruptcy is a good option when you have little to no assets and have a low income. it can also be advantageous to those whose discharged debt is greater than the value of the property sold.

Consider the following:

  • Businesses and individual may file
  • Your income must be under the limit for the Chapter 7 means test
  • it takes three to four months to receive a discharge under normal circumstances
  • The trustee has the authority to sell nonexempt property to satisfy creditors
  • It does not allow the removal of insecure junior liens via lien stripping
  • Tangible personal property can reduce the principal loan balance on secured debts
  • There is no mechanism to make up missed payments to avoid repossession or foreclosure

Chapter 13 Bankruptcy

This is a reorganization bankruptcy for debtors with a regular source of income who have excess over every month and pay part of their outstanding debts as per a plan for repayment. Most filing Chapter 13 are in excess of the Chapter 7 financial requirements – but there are many advantages to Chapter 13 bankruptcy. In Chapter 13 bankruptcy you keep your property but you’ll have to pay creditors an amount equal to the value of your nonexempt property. When you need debt relief but do not qualify for Chapter 7 nd when you have debts that are non-dischargeable debts that you can pay off over a three to five year period you can without losing your property.

Consider the following

  • Only individuals can file including sole proprietors
  • Cannot have in excess of $419,275 of debt that is unsecured and $1,257,850 of debt that is secured
  • Discharge only occurs on completion of payment plans
  • Debtors Keep All Property But Must Pay Unsecured Creditors an Amount Equal to Value of Nonexempt Assets
  • Allows the removal of unsecured junior liens from real property by means of lien stripping
  • It allows for reducing the principal loan balance on debts that are secured

Source: https://www.nolo.com/legal-encyclopedia/what-is-the-difference-between-chapter-7-chapter-13-bankrutpcy.html

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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How Long Does Chapter 7 Bankruptcy Stay On Your Credit Report?

Chapter 7 Bankruptcy

Chapter 7 bankruptcy will remain on your credit report for ten years although bankruptcy filing takes only three to six months. Financial hardship from unforeseen circumstances is the leading reason people give for declaring bankruptcy. Chapter 7 bankruptcy will have a negative impact on your credit and may lower your credit score for years to come. Read on to learn more.

In Chapter 7 bankruptcy – those who file will no longer have to pay debt that is unsecured such as medical expenses, credit card of personal loans but settling secured loans will require the sale of their assets.

Credit Score Impact

The impact the bankruptcy has on your credit score will lesson as the years go by. So, expect a large drop at the beginning but for it to lessen over time. If you miss a credit card payment when you have a high score can take away more points than having a lower score – the same applies with bankruptcy. It also similarly applies if there is only a small number of accounts on your bankruptcy filing, the impact will be less on your credit score.

Some online sources suggest a score of around 780 will have between 200 and 240 points taken off their credit score but someone with a score of 680 will only lose between 130 and 150 points. Clearly it must be considered only when it is the final option on the table.

Source: https://www.cnbc.com/select/how-long-do-bankruptcies-stay-on-credit-report/

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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Is Chapter 13 Worth It?

Is Chapter 13 Worth It

 

When you have no assets Chapter 7 bankruptcy may be your best choice but when filing Chapter 13 bankruptcy you have the ability to maintain assets that are non-exempt as long as you comply with the Chapter 13 terms and conditions. The main danger of liquidation is the equity you may have in your home. Read on to learn more.

When you have equity greater than the limit of the exemption, the property can be protected but is likely to be liquidated should you file for Chapter 7 bankruptcy. If your state permits federal exemptions to be utilized it can protect just over $25,000 worth of equity. In a chapter the value of your home that is non-exempt becomes part of the estate for bankruptcy permitting the trustee to sell the home and distribute the funds to those owed money.

Chapter 13 bankruptcy is deal when a person does not qualify for Chapter 7 or they have assets in need of protecting. Chapter 13 works like a debt consolidation.

A Chapter 13 case will permit you to make payments to all creditors and you can save your home from foreclosure by maintaining the payments. Another advantage is you will only be required to pay a certain percentage of your debt. For example, if you were ordered to pay ten percent, the other 90 percent will be discharged on completion of the case.

Depending on your assets an income, a Chapter 13 bankruptcy may be best for you especially if you have non-exempt assets you wish to protect and maintain.

Source: https://upsolve.org/learn/is-chapter-thirteen-bankruptcy-worth-it/

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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How Much Does a Lawyer Charge For Chapter 7 Bankruptcy?

How Much Does a Lawyer Charge For Chapter 7 Bankruptcy

The average cost a lawyer charges for Chapter 7 bankruptcy is $1,350 with costs varying from $1,200 to $1,500 for the US in 2020. That said, the charges can vary and be greater than this depending on your location, the complications associated with the case and the experience your lawyer has. For example, you may find it costs as little as $4,500 but sometimes can be upwards of $2,200.

Factors Affecting Fees

  • If you live in certain states, Attorneys will charge more for the same services. The cheapest state in the US to file bankruptcy is North Dakota while the most expensive states are Nevada, Maine and New Hampshire, often up to three times as much.
  • Chapter 11 bankruptcies for businesses wishing to continue operations are far more costly and complicated than a Chapter 7 bankruptcy, hence the lower cost of Chapter 7 bankruptcy filing. Chapter 13 bankruptcy is usually somewhere between the price of Chapter 7 and Chapter 11 cases.
  • A simple case where you have just one [profession, simple credit card debt and only basic assets will probably cost less than when you have a spouse, six children, winnings from betting on horses, tax debt, a mortgage, a vacation home in Florida and a wide range of physical assets.
  • An experienced attorney will cost more than an inexperienced one but if your case is complex, it may be worthwhile to have the experienced attorney.

Excessive Fees

Courts do not want people paying too much in attorney fees when they file for bankrupt. An attorney has to disclose the fees charges on a special form called “Disclosure of Compensation.” The appointed trustee reviews this and if they consider excessive fees to have been charged, a motion can be filed requesting the judge to return part of the fee or cancel the fee. The person filing for bankruptcy can also file that charge.

Source: https://www.thebankruptcysite.org/resources/typical-attorney-fees-chapter-7-bankruptcy.htm

Speak With Our Bankruptcy Lawyers In Phoenix & Scottsdale

Canterbury Law Group should be your first choice for any bankruptcy evaluation. Our experienced professionals will work with you to obtain the best possible outcome. You can on the firm to represent you well so you can move on with your life. Call today for an initial consultation. We can assist with all types of bankruptcies including Business BankruptcyChapter 7 BankruptcyCreditor RepresentationChapter 5 ClaimsChapter 13 Bankruptcy, Business RestructuringChapter 11 Bankruptcy, and more.

*This information is not intended to be legal advice. Please contact Canterbury Law Group today to learn more about your personal legal needs.

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