BANKRUPTCY

U.S. BANKRUPTCY COURTS – Each federal district court has a bankruptcy unit that hears and decides petitions of individuals and businesses seeking relief from bankruptcy. Under the federal bankruptcy code, there are four categories of such cases. There are three main types of bankruptcy cases. These are referred to by their chapter number in the Bankruptcy Code.

• Chapter 7 liquidation, for giving individuals and businesses a fresh start;
• Chapter 11 reorganization, suitable for corporate debtors;
• Chapter 13 reorganization, suitable for individual wage earners, and;
• Chapter 12 reorganization, suitable for family farmers

Federal Courts

People who are having trouble paying their debts sometimes consider bankruptcy as a remedy for this situation.

An individual, called a debtor, usually files bankruptcy to obtain a discharge, which will wipe out his or her debts so that they will not have to be paid. Once the bankruptcy begins, creditors cannot try to collect discharged debts from the bankruptcy debtor or sue the debtor to obtain a judgment. With a few exceptions, the creditors have no claim on the debtor’s future income or future assets.

ALTERNATIVES TO BANKRUPTCY

HOW DO I FILE A BANKRUPTCY PETITION?
Florida Federal Courts
A bankruptcy case is started by filing a petition with the Bankruptcy Court in the federal judicial district and division where the debtor resides. The petition contains a request for relief under one of the chapters of the Bankruptcy Code. A debtor must file a statement regarding various financial matters and disclose all creditors and assets. A debtor is required to appear at a meeting conducted by either a trustee or the United States Trustee, during which creditors may ask questions regarding the debtor’s finances, assets, and liabilities. Depending on the chapter in which the bankruptcy is filed and the complexity of the case, the debtor may also be required to appear at hearings before the bankruptcy judge.

DO I NEED A LAWYER?
As in any court, individuals have a right to represent themselves before the Bankruptcy Court. However, bankruptcy is a complex area and involves many considerations, including whether to file, the election of the appropriate chapter, the use of exemptions, understanding all of the protections of the Bankruptcy Code and using them to the debtor’s advantage. The right decision for you depends on an evaluation of your family status, your assets, your obligations, and other factors. It is a very serious step that could affect you for the rest of your life. It is possible in a bankruptcy that a debtor will lose all assets and still come out owing all of his or her debts. A lawyer can explain to you how the process works and can help you reach an intelligent decision.

Some debtors use non-lawyer bankruptcy petition of filing services to complete the schedules and documents which must be filed with the bankruptcy petition. While this may cost less initially than consulting an attorney, these non-lawyer services by law cannot give legal advice or represent the debtor in the Bankruptcy Court. If a problem arises, they will not be able to help you in court.

If you are contemplating a Chapter 11 or Chapter 13 case, then the need to be represented by an attorney is even greater. Certain complexities in the law make it extremely difficult for a debtor to successfully conclude a Chapter 11 or Chapter 13 case without the assistance of an attorney.

A corporation cannot represent itself in a bankruptcy case and must be represented by an attorney.

Ask Clifford J. Geismar P.A about his experience.