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Bankruptcy & Debt law aims to assist individuals and businesses who are unable to pay their debts. It provides the option of partial debt relief, restructured payment plans and, in severe cases, the dismissal of debts. Broadly, it includes Chapter 7, Chapter 11, and Chapter 13 federal bankruptcy laws. Though these laws are federal, they interact with the local state laws of Burlington that govern property rights, exemptions, and debtor-creditor relations. It is essential to understand these complexities before moving forward with a bankruptcy or debt-related case.
Navigating through Bankruptcy & Debt law can be complicated and can involve multiple legal procedures and paperwork. An experienced lawyer can provide guidance through the process, help you understand your rights and options, assess the best strategy for your situation, negotiate with creditors, and ensure all paperwork is correctly filled out and filed on time. Also, a lawyer can protect you from potential violations of your rights by creditors or debt collectors.
Burlington's local laws comply with the federal bankruptcy laws but also detail specific state exemptions such as homestead exemption, personal property, and tools of trade exemptions. These can affect what assets you are allowed to keep in a bankruptcy case. The Vermont Statutes govern these local rules. Additionally, the Automated Clearing House (ACH) rules are applied to stop the automatic withdrawal of payments to creditors. Consultation with a local attorney can ensure you are taking full advantage of Burlington's specific laws and guidelines around bankruptcy and debt.
Chapter 7 bankruptcy, also known as liquidation bankruptcy, allows debtors to wipe out most of their general unsecured debt such as credit cards and medical bills. However, the debtor might have to give up some property, which will be sold to repay creditors. Not everyone qualifies for Chapter 7 bankruptcy; it depends on your income, assets, expenses, and debt.
Chapter 13 allows individuals with a regular income to develop a plan to repay all or part of their debts. Under this chapter, debtors propose a repayment plan to make installments to creditors over three to five years. This is typically for people who want to keep their home and other assets and are willing and able to pay off their debts over time.
An automatic stay is a provision in bankruptcy law that temporarily halts attempts by creditors to collect debts from a debtor, stop wage garnishment, and halt foreclosure actions.
Bankruptcy negatively affects your credit initially. A bankruptcy can stay on your credit report for up to ten years. However, with good financial habits post-bankruptcy, you can start to rebuild your credit.
No, not all debts are dischargeable. For example, tax debts, alimony, child support, substantial education-related debt, and obligations under a divorce decree or settlement are often not dischargeable.
If you're looking for additional resources on bankruptcy and debt, you can consult the U.S. Courts website which provides general information about federal bankruptcy laws. The Federal Trade Commission (FTC) also offers advice on credit and loans, including dealing with debt. The local Vermont State website has useful information on state-specific debt and bankruptcy laws. The Legal Services of Vermont and Vermont Law School’s Bankruptcy Clinic provides free or low-cost legal services for people in need.
If you need legal advice regarding bankruptcy or debt in Burlington, the best first step is to find and consult with a local attorney who specializes in bankruptcy laws. Consider your financial situation, the kind of debt you have, and the exemptions you’d like to claim and discuss these with your lawyer. Always remember to bring all relevant documents related to your finances and debt to your lawyer's office to have a fruitful discussion.
