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Orland Park bankruptcy lawyerWhile no one wants to declare bankruptcy, there are cases in which it can be the best choice for a family’s long-term financial well-being. Despite the stigma that is attached to bankruptcy, it can help a person or family get a fresh financial start, allowing them to escape a difficult financial situation that may have occurred through no fault of their own, but simply because of bad luck.

If money issues have created an inescapable burden, Chapter 7 bankruptcy or Chapter 13 bankruptcy can provide relief for those who qualify. A bankruptcy attorney can tell you if either of those options might work for you, or if you should go another route.

Should I File for Bankruptcy?

Divorce, loss of employment, sizable medical bills, potential home foreclosure, and unmanageable credit card debt are common reasons why people declare bankruptcy. However, before you consider taking this step, you will likely want to exhaust all other possible avenues.

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Illinois bankruptcy lawyersLike most things in life, bankruptcy can be either a negative thing or a positive thing - it all depends on how you handle it. There are certain things that you can and cannot do when filing for bankruptcy. Violating bankruptcy laws can result in criminal charges, meaning you could be subject to up to five years in jail and $500,000 in fines. If you want to make your bankruptcy process a good one, be sure to avoid making these costly mistakes:

1. Lying or Attempting to Hide Assets

The number one thing you should not do when filing for bankruptcy is lying about factors that could make or break your ability to declare bankruptcy. When reporting your assets, income, or debts, you should be completely honest or you could face criminal charges and your bankruptcy case will be dismissed. To file for a Chapter 7 bankruptcy, you have to go through what is called a “means test” which examines financial records, income, expenses, and your debt to determine whether or not you qualify. Lying or hiding assets so you pass the means test is not good.

2. Increasing Your Credit Card Debt

This is another no-no when filing for bankruptcy. You may think that bankruptcy will relieve you from all of your credit card debt, but typically, credit card purchases that are made within 90 days of filing for bankruptcy are not included in the bankruptcy relief. This means that you will be responsible for paying your creditors that money.

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Cook County bankruptcy attorney Chapter 7 Chapter 13When people get in over their head with debt, the laws of the United States have provided legal options to help. Bankruptcy is a legal way for people to be released from liability for their debts. The bankruptcy process occurs in a court with a judge and a court trustee who will examine the ability of the person to pay their debts and decide whether or not their debts should be discharged. There are two different types of bankruptcy that the majority of bankruptcy cases are filed as: Chapter 7 and Chapter 13 bankruptcy.

Chapter 7 Bankruptcy

The majority of bankruptcy cases in the United States are filed as Chapter 7 bankruptcies; these accounted for 63 percent of cases in 2015. A Chapter 7 bankruptcy is what you usually think of when you think of bankruptcy--all of your debts are discharged if you are granted a bankruptcy under this chapter.

In a Chapter 7 bankruptcy, you are able to keep exempt property, which can include:

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