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Illinois bankruptcy lawyerWhen deciding whether or not to file for Chapter 7 or Chapter 13 bankruptcy, often the choice boils down to the immediate finances. Chapter 7 bankruptcy usually requires a higher upfront payment, typically around $1,000 versus Chapter 13 may offer $0 deposit. Throughout the duration, Chapter 13 is more expensive, approximately $3,000, but many debtors are unable to produce the higher initial costs for the alternative, and Chapter 13 often allows the inclusion of the fees in the repayment plan. Unfortunately, for a significant portion of the population, this decision is costly with lasting effects on the credit for only short-term relief.

Debtors Below The Poverty Line Are More Susceptible to Relapse

The low initial costs of Chapter 13 bankruptcy is alluring for many individuals struggling to make ends meet. Armed with the dream of living in a home without collectors calling around the clock and having some money left over at the end of the month, many debtors turn to debt relief options. However, not all bankruptcy options are equal. Chapter 13 operates on a repayment plan, typically about five years in length. So long as payments are kept up to date, collectors are unable to harass clients. However, for the population living under the poverty line and struggling to make ends meet, about half make it through the first year, let alone five years, and the calls begin once more.


Illinois bankruptcy lawyerOne of the most commonly asked questions for people considering bankruptcy is, "what is a bankruptcy discharge?" A bankruptcy discharge is a court order that makes previously charged debts permanently unenforceable, effectively wiping the slate clean. The debtor becomes no longer responsible for the payment. As an additional benefit, all harassing calls, letters, and other forms of communication from creditors attempting to collect the money must stop. If collection attempts continue, creditors risk being in held in contempt of court and face potential punishments.

Are All of My Bills Dischargeable?

Not all debts discharge. Some obligations remain valid even after the completion of the bankruptcy process. Eligibility for payment discharge depends on the chosen bankruptcy chapter. Typically, Chapter 13 has a broader range of dischargeable payments. The following expenses are commonly non-dischargeable:


Illinios bankruptcy lawyerThe decision to declare bankruptcy is not easy. Admittedly, the cessation of bill collection attempts looks more appealing each time the phone rings, however, filing for bankruptcy has considerable secondary repercussions. Qualification standards and long-term effects may influence your decision when determining if Chapter 7 bankruptcy is the best solution for your situation.

What Is Chapter 7 Bankruptcy?

Chapter 7 Bankruptcy is often referred to as “liquidation bankruptcy”. It is a relatively quick process, typically completed between four and six months. Brevity appeals to a significant portion of the population, as does the discharge of unsecured debts. Discharge means credit cards, personal loans, and other unsecured debts become permanently unenforceable, never needing repayment. The downside is that you will need to sell many of your non-exempt assets; hence, the name, liquidation bankruptcy.


Posted on in Bankruptcy

DuPage County bankruptcy attorney, Chapter 7 Bankruptcy, liquidation bankruptcy, filing for bankruptcy, financial problemsEntering serious financial troubles is a subject that no one wants to discuss. Moreover, having to make the decision to file for bankruptcy can be very embarrassing and frustrating. Yet sometimes filing for bankruptcy is the best option. To file for Chapter 7 bankruptcy, there are qualifications and requirements that must be met, so that the overall process can go as smoothly as possible.

What is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy, also known as “liquidation bankruptcy,” releases most unsecured debt, including credit card debt, medical payments, and personal loans. This type of bankruptcy is the easiest, quickest, and most common, with over 63 percent of all bankruptcy cases filed under Chapter 7 in 2016.


Illinois bankruptcy lawyersThe decision to file for bankruptcy is not one easily made, but those that know how to recognize the signs of serious financial trouble may be more prepared for the process. Those same indicators can help one determine when to proceed with the process. Learn what these signs are, discover what options may be available to you, and gain insight into how an experienced attorney can assist with the process in the following sections.

Combatting Common Bankruptcy Myths

Before one can truly determine if bankruptcy may be the appropriate path, they must first understand what bankruptcy is and what it is not. For example, many people believe that bankruptcy will result in a loss of all assets, including their home and personal vehicles. Thanks to the protection of certain excluded assets, this is not always the case. Yet, even if your home or primary vehicle is in jeopardy, it may be possible to negotiate an option that will work for you and your creditors.


DuPage County bankruptcy lawyersThe decision to file for bankruptcy is not one easily made. There are many potential downsides, such as the impact to your credit and the potential loss of some assets. Yet, when the calls from creditors have become a source of constant stress, the negative consequences seem worth enduring to receive the debt relief that bankruptcy can provide. So just how do you decide if bankruptcy is the right option for you? Many debtors find that a comparison of the pros and cons can help. Learn more about them, and discover what an experienced attorney can do to help you through the process, with help from the following information.

Potential Bankruptcy Benefits (Pros)

Many of the benefits that can come from filing for bankruptcy, such as the protection from creditor harassment and aggressive collection actions, are well-known. However, there are several other, lesser-known potential benefits as well. Examples include:


DuPage County bankruptcy lawyersFiling for bankruptcy can relieve financial stress and give debtors a fresh, new start – but what many debtors do not realize is that the obligation to one’s creditor remains in effect until the debts are legally discharged. What is a bankruptcy discharge, when does it occur, and is there anything that debtors can do to expedite the process? The following information explains, and it describes where you can find assistance for your Illinois bankruptcy case.

What is a Bankruptcy Discharge?

A discharge in bankruptcy is a legal and permanent order that releases the debtor from any further obligation to the creditor. It also prohibits the creditor from contacting the debtor (i.e., email, phone, mail, or in-person) and they can no longer use legal actions to collect the debt (i.e., wage garnishment, intercepting tax refunds, etc.). It is important to note that discharge does not stop a creditor from repossessing or recover property with a valid lien (i.e., homes, vehicles, etc.). Some debtors may be permitted to work out an arrangement with their creditors to keep an asset. Others may be permitted to keep certain exempt assets. An experienced attorney can help determine if you may be eligible for either of these options.


DuPage County bankruptcy attorneysFiling for bankruptcy has never been “easy,” but changes over the last several years have made the process even more complex than it used to be. Now, consumers must attend both credit counseling and debtor education before they can receive a bankruptcy discharge. Learn more about these counseling requirements in the following paragraphs, including how they are different and what you can expect during the process.

Why Counseling is Required

Most consumers would rather stay out of debt and avoid bankruptcy, but without the right tools, strategies, and information, doing so can be extremely difficult – especially in a world where credit is necessary for almost everything. Seeing the disconnect, the U.S. Government decided to put a new requirement in place; all debtors would need to attend counseling to improve their understanding of credit, debt, and how to manage it all wisely.


Illinois bankruptcy attorneysThe decision to file for bankruptcy is not one easily made. It requires a debtor to take an honest look at their situation and admit that they need help. Filing for bankruptcy can also cause feelings of guilt, and it may negatively impact your credit score. How do you rebuild it, and how long does it take? The following provides some advice and guidance on this issue and explains where you can find assistance with your bankruptcy needs.

How Does Bankruptcy Affect Your Credit?

When you file for bankruptcy, your credit does take a hit. Furthermore, the bankruptcy stays on your credit for a total of 10 years. However, the damage is not as extensive as most people think. Yes, bankruptcy might make you a subprime borrower, but you also cannot file for bankruptcy again for another eight years if you file Chapter 7. Also, if you file Chapter 13, your debt-to-income ratio could be significantly decreased over the course of just a few years.


Illinois bankruptcy lawyersCredit is often used to obtain the important things in life: homes, vehicles, furniture, and more. Unfortunately, the use of credit also places consumers in debt. Should a life crisis occur – an illness, an auto or work accident, a layoff at their job, or another unexpected event – debt can quickly go from manageable to a full-on crisis. Is it possible to regain control without filing for bankruptcy? Perhaps, but even if bankruptcy is required, some strategies can be used to improve your circumstances.

An Overview of the Bankruptcy Process

Debtors who are unable to make good on their debts may be eligible to file for either Chapter 7 or Chapter 13 bankruptcy. Both offer a way to start with a “clean slate,” but both also have an impact on your credit score and ability to obtain new credit. The effect is temporary, of course, but it is an inconvenience that debtors should consider and discuss with an attorney before moving forward with the bankruptcy process.


DuPage County bankruptcy attorneys, Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, types of bankruptcy, debtThe debt we are responsible for can pile up on us, seemingly out of nowhere. In an economy that pays lower wages in comparison to a steadily increasing cost of living, more and more people are getting crushed under the weight of their debt. Filing for bankruptcy can be a way out. The two most common types of bankruptcy in Illinois are Chapter 7 and Chapter 13; each has their unique characteristics.

Chapter 7 Bankruptcy

Filing for Chapter 7 Bankruptcy is a way to obliterate your debt—a process where your debt assets are sold, your creditors receive outstanding payment, and you are released from the debt. It is important to understand that while a Chapter 7 Bankruptcy can eliminate your debt, you also lose possession of any of the property you filed inside of the Chapter 7.

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