If you are in a dire financial situation, you may be considering the process of bankruptcy. Velasco Law Office is an experienced bankruptcy law firm ready to guide you through your options and help you choose the right path to right your financial ship. There are two options under the bankruptcy laws: a liquidation or a repayment plan. In order to know what is right for your situation, you should consult with an attorney to discuss your circumstances. If you need the legal support of a knowledgeable and skillful attorney, contact Juan C. Velasco, Esq.

Liquidation (Chapter 7)

In liquidation, also called a Chapter 7 bankruptcy, the bankruptcy court will use whatever cash is generated by selling off your assets to fully satisfy creditor claims. You will be allowed to keep a certain amount of property under the exemptions allowed by federal and state bankruptcy laws. The definition of “exempt property” differs in each state, and it can include clothing, furniture, household appliances, tools of your trade and, perhaps, your home or car.

Repayment Plan (Chapter 13)

In a repayment plan, sometimes called a Chapter 13 bankruptcy, you pay a portion of your monthly income to a trustee for distribution to your creditors. A repayment plan is useful when you are behind on your home or car loan. The repayment plan can be used to extend the time period for paying your bills and might allow you to pay less than you owe. The extended payment period, up to 5 years, has the advantage of allowing you to make smaller payments. You will be allowed to keep part of your monthly income to pay for living expenses, such as food, clothing, housing, and medicine. To qualify for a Chapter 13 repayment plan, you must have regular income and your debts, both secured and unsecured, must not exceed specific amounts.

To learn more about the bankruptcy process, simply read Attorney Velasco’s Complete Guide to NJ Bankruptcy.

Contact a Middlesex County Law Firm with Your Best Interests in Mind

If you are facing the reality of bankruptcy, you need an experienced attorney to help you choose the right option. Your lawyer can study your situation and advise whether to seek a liquidation or repayment plan. The best bankruptcy option for you depends on a number of things, including the source of your income, the amount and types of your bills, your desire to protect any cosigners or guarantors, and the importance to you of maintaining your record of paying your debts. If you need quality legal advice and an attorney to represent your needs through the bankruptcy process of your choice, contact Velasco Law Office for a consultation.