About us

- Bankruptcy -

Debtors are protected by Bankruptcy Laws and Algoflaw P.A.’s bankruptcy overview will help you understand what your first steps will need to be. At the end of your bankruptcy, you should be better positioned to move forward and have the tools you need to succeed going forward.

Chapter 7 and Chapter 13 are the two main bankruptcy cases that are most commonly declared. The names come from the chapter number in the Bankruptcy Code. Some of the factors that determine the type of bankruptcy case that is filed are amount of debts, assets, income, types of arrearages and the goals of the debtor.

Chapter 7:

This is the most common bankruptcy case; a liquidating bankruptcy. In return for having debts discharged, the debtor must turn over to the bankruptcy trustee all property except for certain assets which applicable federal or state law allows the debtor to keep as exempt. The trustee sells the property and distributes the proceeds to the creditors according to priorities established by law. Very often there is not enough money to pay for anything more than the costs of administration, and the creditors will receive nothing. The main advantage of Chapter 7 is that the debtor emerges from bankruptcy without any future obligations on his or her discharged debts.

Chapter 13:

Chapter 13 often used by individuals who want to catch up car loan payments or past due mortgage and keep their assets. In Chapter 13, the debtor must propose in good faith to pay all or part of the debts from future income over a period of time ranging from three to five years. If the court approves the plan of payment, the debts may be settled in this manner, even if the creditors are not willing to go along with the plan. If the debtor makes the payments as required, he or she will not have to surrender property to the trustee.

Contact us today for a full review and free consultation.