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Bankruptcy law in Florence, United States, like in the rest of the country, is a federal law allowing individuals or businesses unable to repay their debts, the option to seek relief from some or all of their debts. It's administered through the federal court system and is designed to give a debtor a financial 'fresh start'. The most common types of bankruptcy are Chapter 7, which involves liquidation of assets, and Chapter 13, which involves a repayment plan.
While it is possible to file bankruptcy without a lawyer, it's not usually recommended. Bankruptcy law is complex and making errors can impact your rights. Lawyers provide valuable advice on whether bankruptcy is suitable for your situation, which chapter to file, risk assessment, and asset protection. If you're facing foreclosure, wage garnishment, lawsuits, or harassing creditor calls, a lawyer can help stop these while your case is in progress.
Even though bankruptcy law is federal, some aspects of the law vary from state to state. In Florence, you're allowed to use either the federal bankruptcy exemptions or the Alabama state bankruptcy exemptions, but you can't mix and match. Plus, Alabama has an unlimited homestead exemption if you file jointly with your spouse, which allows you to protect your home equity. Additionally, certain wildcard and personal property exemptions may apply, too. Navigating these laws is best done with local legal expertise.
No, not all types of debts are dischargeable. Certain types like student loans, child support, alimony, and tax debts are generally not dischargeable.
Chapter 7 bankruptcy is known as straight or liquidation bankruptcy where your non-exempt assets could be sold to repay creditors. Meanwhile, Chapter 13 bankruptcy is more of a repayment plan where you get to keep your assets and pay off your debts over a 3-5 year period.
Chapter 7 bankruptcy stays on your credit report for 10 years, whereas Chapter 13 stays for 7 years.
Yes. Both federal and state exemption laws allow you to 'exempt' or shield some amount of equity in property or other assets like an auto, work tools, and basic household belongings.
For Chapter 7 bankruptcy, you can file every 8 years. For Chapter 13, you can file 2 years after a previous Chapter 13 and 4 years after a previous Chapter 7.
You may find additional information from the United States Bankruptcy Court, Alabama State Bar Association, and the National Association of Consumer Bankruptcy Attorneys. They provide resources related to bankruptcy laws, FAQ, and local legal help.
If you're considering bankruptcy, first meet with a credit counselor that is approved by the U.S. Department of Justice. This is a requirement before you file. Following this, consider a consultation with a bankruptcy lawyer in Florence to assess your financial situation and discuss your options. It's important you take these steps prior to making any major financial decisions.
