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San Antonio Bankruptcy - Types of Bankruptcy

What Type of Bankruptcy should you file? What Types of Bankruptcies are there?

What kind of bankruptcy should I file? That is a question that many people in San Antonio, Texas ask when they are facing foreclosure, IRS tax problems, repossession, lawsuits, child support they are behind on, or just too much credit card debt. Bankruptcy Laws were designed to give consumers and businesses a “fresh start” by either eliminating most all of their debts or repaying their debts through an order of the Bankruptcy Court.

Since there are all types of bankruptcies and each bankruptcy has numerous rules as to the kind of debts that can be included, who is able to file, and what property can or cannot be kept, contact the San Antonio Bankruptcy Lawyers at The Law Offices Of R.J.Atkinson for a free bankruptcy evaluation to determine what type of bankruptcy is best suited for your debt situation.

If you or your company is considering filing for bankruptcy, you are probably wondering what type of bankruptcy to file. Whether the bankruptcy filing is for a person or a business, there are different types of Bankruptcy available depending on what you want to do. If you are a person as opposed to a company or legal entity, then there are basically 4 types of bankruptcy available. All bankruptcies are named after the part of the Bankruptcy Code which they come from. More specifically they come from the chapters of the Federal Statutes known as the United States Code. The section of the Federal Statutes that cover Bankruptcy are called the Bankruptcy Code and can be found at 11 U.S.C. or United States Code title 11.

People are limited to four types of Bankruptcy which are named after the corresponding chapters of the Bankruptcy Code which are Chapter 7, Chapter 11, Chapter 12, and Chapter 13. Usually, most people who file for bankruptcy file either a Chapter 7 or a Chapter 13. Unless you are a farmer, have an extremely high income, or significantly high debt limits of which you want or need to repay, you probably will file a Chapter 7 or Chapter 13.

The Following is a brief look at the Types of Bankruptcy:

Chapter 7 Bankruptcy: Debt Liquidation and Debt Elimination

The most popular bankruptcy is Chapter 7. It is often called a “liquidation” or “straight” bankruptcy because it eliminates or “discharges” most debts. Chapter 7 Bankruptcy is available to both individuals and businesses. For people, it is kind of like a going out of business sale. You give all of your property to a trustee appointed by the bankruptcy Court and the trustee in turn sells the “non-exempt” property or in simpler terms the property you are not allowed to keep by law and distributes the proceeds, if any to the creditors. If there is no money available then the court will issue an order saying that any debts are discharged which means the person is no longer obligated to pay the debt. It is eliminated.

In case you are wondering, most people who file for Chapter 7 Bankruptcy in Texas are able to keep all of their property. That’s because the State of Texas allows individuals to keep a generous amount of property such as $30,000.00 worth of personal property, one vehicle per licensed driver in the household, and $125,000.00 equity in a home. There are some debts that Chapter 7 cannot discharge such as child support and certain taxes, but for the most part, a person who is eligible to file for Chapter 7 can eliminate their unsecured debts and keep their property.

Businesses are eligible to file Chapter 7 but they are not allowed to keep any property. A business must cease doing business upon the filing of a Chapter 7 and even after the trustee liquidates the assets of the business, businesses do not receive a discharge.

Chapter 7 Liquidation Under The Bankruptcy Code cases may be filed by an individual, corporation, or a partnership.

Chapter 11 Bankruptcy: Business and Corporate Reorganization

You may have heard of Chapter 11 Bankruptcy in the news or when a large company files for bankruptcy protection. Chapter 11 is usually filed by businesses seeking to reorganize. It is available to people but is seldom used by them. Chapter 11 is a fairly expensive process for individual and as such is generally used by people with high amounts of debt and/or high income who choose to reorganize their finances. The main purpose of a Chapter 11 Bankruptcy is to allow the business or individual some breathing room from their creditors while allowing them to get back on their feet and hopefully repay their debts in part or in full. While the person or business filing a Chapter 11 does get some breathing room, they must compile a plan of reorganization to propose their creditors and the Bankruptcy Court. Chapter 11 Reorganization Under The Bankruptcy Code allows a good amount of flexibility in structuring reorganization. There is no debt limits imposed under Chapter 11.

In some Chapter 11 cases the assets of the person or business may be transferred to a trustee and the trustee may end up taking care of the business or financial affairs of the debtor. The primary objective in Chapter 11 is to propose a plan of reorganization to the creditors which sets out a method and timetable for repayment and reorganization. The Chapter 11 plan is voted on by the creditors, so if the plan is never accepted by the creditors then the case is either dismissed or converted to Chapter 7 Bankruptcy liquidation. If the Chapter 11 plan is accepted by the creditors then upon confirmation of the plan by the court, the debtor is discharged form all the” pre-petition” or pre-bankruptcy filing debts.

Chapter 12 Bankruptcy: Farming or Fisherman Reorganization

Chapter 12 Bankruptcy is a used specifically for "family farmers" or "family fishermen". There are not many Chapter 12 Bankruptcy cases filed in Texas. A Chapter 12, like a Chapter 11 is a reorganization bankruptcy. Chapter 12 is for farmers or fishermen whose debts fall within certain limits and whose primary source of income comes from farming.

Since Chapter 12 was designed for "family farmers" or "family fishermen" with "regular annual income." It enables financially distressed family farmers and fishermen to propose and carry out a plan to repay all or part of their debts. Under chapter 12, debtors propose a repayment plan to make installments to creditors over a period of three to five years. Chapter 12 was tailored to meet the economic realities of family farming and the family fisherman, chapter 12 eliminates many of the barriers such debtors would face if seeking to reorganize under either chapter 11 or 13 of the Bankruptcy Code. A Chapter 12 is more streamlined, less complicated, and less expensive than chapter 11 and is somewhat similar to a Chapter 13 but Chapter 13 is not available to corporate debtors as is a Chapter 12 to certain qualified corporations.

Chapter 12 is a court supervised reorganization bankruptcy which allows "family farmers" or "family fishermen" with "regular annual income” to repay their debts over 3 to 5 years under a court supervised repayment plan.

Chapter 13 Bankruptcy: Personal Debt Reorganization or Repayment of Debt

A Chapter 13 bankruptcy is a personal reorganization bankruptcy that provides a way for people to reorganize their debts. It is similar to a Chapter 11 where a business is allowed to operate while getting some breathing room except the difference is that Chapter 13 is for a person and not a business. In essence, you as an individual come up with a repayment plan based on your disposable income, and propose a plan of repayment for a period of 3 to 5 years.

A Chapter 13 Bankruptcy is also called a wage earner's plan since it enables individuals with regular income to develop a plan to repay all or part of their debts. Under Chapter 13, a debtor proposes a repayment plan to make installments to creditors over three to five years with court approval. Chapter 13 Bankruptcy can be a debt relief option for people who have “non-exempt property” that they want to keep. It can also only an option for those individuals who have predictable income and whose income is sufficient to pay their reasonable expenses with some money left over to pay towards their debts. Chapter 13 permits individuals to keep their property and is often used to stop foreclosure, stop repossession, and to repay past due child support.

Chapter 13 debtors propose a repayment plan that must be approved by the court, and after completion of their payments under the repayment plan; they receive a discharge for most debts. Chapter 13 Individual Debt Adjustment is not available to corporations or partnerships.

If you have questions about filing for bankruptcy or what kind of bankruptcy to file, contact the San Antonio Bankruptcy Lawyers at The Law Offices of R.J.Atkinson for a free bankruptcy evaluation to discuss your bankruptcy options. If you live in San Antonio, Boerne, New Braunfels, Converse, Helotes, Kerrville, Comfort, Bandera, Canyon Lake, Seguin, or in Bexar County, Comal, Gonzales, Guadalupe, or Kerr contact the San Antonio Bankruptcy Lawyers at The Law Offices of R.J.Atkinson. An experienced San Antonio Bankruptcy Lawyer can help you decide if you are eligible for bankruptcy, and what bankruptcy option is the best option for you to get rid of your debt, significantly reduce your debt, or reorganize your debt.

What Type of Bankruptcy should you file?

Call R.J.Atkinson for Bankruptcy Debt Relief in San Antonio: 210-805-9909

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Filing Bankruptcy can sometimes be the fastest way to get out of debt and may be the most affordable way to get a fresh financial start. Chapter 7 Bankruptcy can quickly wipe out your debts, increase your credit score, stop wage garnishments, get rid of credit card debt, eliminate medical bills, stop payday loans, stop bill collectors, erase negative credit reporting, and reestablish new credit after bankruptcy. RJ Atkinson, San Antonio Bankruptcy Lawyer has payment plans to make filing Chapter 7 or Chapter 13 Bankruptcy affordable which include low cost flat fees for Chapter 7 that may be considered the cheapest bankruptcy attorney fees compared to fees other bankruptcy lawyer charge. Chapter 13 Bankruptcy can save your home from foreclosure, save your car from repossession, lower monthly payments, reduce interest rates, get rid of late fees, reduce credit card interest, payoff high credit card debt, raise your credit score, stop creditor harassment, get rid of debt, reduce debt, eliminate creditor calls at work, stop collection calls, start over financially, discharge debts and/or be debt free in 3 to 5 years. IRS tax problems, tax levies, wage garnishments, back taxes, payroll taxes, income taxes can often be handled in Chapter 13 bankruptcy. Divorce/Bankruptcy – past due child support arrears, alimony, spousal support, and divorce debt can often be handled in chapter 13 bankruptcy. The Law Offices of RJ Atkinson handles debt consolidation, loan modifications, credit card debt settlement, debt negotiation, lawsuit defense, IRS problems, credit card lawsuits, TROs temporary restraining orders to foreclosure, forbearance agreements to foreclosure, FDCPA Fair Debt Collection Practices Act lawsuits, FCRA Fair Credit Reporting Act lawsuits, credit report disputes, debt collection lawsuits, adversary complaints in bankruptcy, bankruptcies, foreclosure workouts, mortgage short sales, real estate property tax disputes, civil litigation, commercial litigation, tax lawsuits, small business bankruptcy, corporate bankruptcy, business creditor representation, and most every kind of debt related issue or financially based legal problem on a case by case basis.

San Antonio Bankruptcy Attorney at RJ Atkinson handles Personal Bankruptcy, Business Bankruptcy cases and discount legal services in and around San Antonio TX Bexar County, as well as in New Braunfels, Cibolo, Comfort, Bandera, Boerne, Kerrville, Hondo, Castroville, Medina, Poteet ,Pleasanton, Lytle, Live Oak, Leon Valley, Jourdanton, Floresville, La Vernia, Nixon, Poth, Stockdale, Carpenter, Ingram, Hunt, Center Point, Selma, Seguin, Schertz, Helotes, Garden Ridge, Hill Country Village, Fredericksburg, Uvalde, Alamo Heights, Terrell Hills, Universal City, or in the counties of Atascosa, Bandera, Bexar, Comal, Dimmit, Edwards, Frio, Gonzales, Guadalupe, Karnes, Kendall, Kenney, Kerr, Maverick, Medina, Real, Terrell, Uvalde, Val Verde, Wilson, Zavala.
Pursuant to 11 U.S.C. §528, “We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”
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