Acquiring debt is easy but getting out of it is the challenge. According to Bankrate.com, consumer debt was at $14.2 trillion as of November 2020, and Americans were “carrying an average personal debt of $92,727.” While some fall into debt trying to start a business, others let their spending get out of control, eventually landing them in a situation where they cannot afford to pay back even one lender who they borrowed from.
While there are certain methods individuals can use to get their debt under control such as obtaining a debt consolidation loan, there is also bankruptcy. Although there are different forms of bankruptcy an individual can file for, Chapter 7 is one of the more common forms used by individuals. With Chapter 7 bankruptcy, individuals are given the opportunity to discharge some or all of their debts which gives them a “fresh start,” according to the United States Bankruptcy Court Southern District of Alabama.
If an individual is drowning in debt, is being sued by one or more creditors, or is looking for a way to obtain a fresh slate, they can schedule an initial consultation with an Alabama bankruptcy lawyer to find out if they qualify for Chapter 7 bankruptcy.
Things to Know About Chapter 7 Bankruptcy
- Chapter 7 bankruptcy is often referred to as “straight bankruptcy” in Alabama.
- If an individual qualifies for Chapter 7 bankruptcy, a trustee will be appointed to their case and will help them sell assets that are nonexempt. The money received for these assets will be used to pay creditors.
- Although certain property may be protected from being liquidated, there is a chance that an individual could lose some of their property.
- Chapter 7 bankruptcy is only available to certain types of business owners. If a business owner isn’t sure whether they would qualify to file for Chapter 7 bankruptcy, they can always consult with an attorney who can determine this for them.
- Repayment plans are not a part of the Chapter 7 bankruptcy process. Instead, individuals will use the proceeds from their assets to pay their creditors and some or all of their remaining debt will be discharged.
Important: It is important for individuals to understand that certain types of debt cannot be discharged in a Chapter 7 bankruptcy and they would, therefore, still be obligated to pay the creditor in which they owe.
If an individual in Alabama is considering filing for bankruptcy and they would like more information or they want to determine if they qualify, they can contact Hill, Gossett, Kemp & Hufford, P.C. to speak with an Alabama bankruptcy attorney.
Disclaimer: No representation is made that quality of legal services provided is greater than the quality of legal services provided by other attorneys.
Hill, Gossett, Kemp & Hufford, P.C. can be reached at:
2603 Moody Parkway, Suite 200
Moody, Alabama 35004
Phone: (205) 640-2000
7900 Parkway Drive
Leeds, AL 35094
Phone: (205) 699-5500
6441 U.S. Highway 11
Springville, Alabama 35146
Phone: (205) 467-2225