Bankruptcy is a federal program established to provide debt relief to persons and organizations suffering from financial difficulties. Different types of Bankruptcy relief are available under various chapters of the United States Bankruptcy Code. The two primary forms of Bankruptcy relief available for individuals are under Chapters 7 and 13.

Bankruptcy can be an invaluable tool if you answer yes to any of the following questions:

• Are you behind on your mortgage or facing foreclosure?

• Are your wages being garnished?

• Did you have a judgment entered against you?

• Are you behind on your car payments or facing repossession?

• Are you struggling to make the minimum payments on your credit cards?

• Do you have unpaid medical bills?

• Has your bank account been frozen?

• Have you taken out payday loans?

• Are you behind on your income taxes?

• Do you owe child support?

• Has your license been suspended because of unpaid parking tickets?

• Are you overwhelmed by the high interest rate on your personal loans?

• Are you recently unemployed?

Chapter 7 Bankruptcy eliminates all unsecured debts such as: credit cards, deficiency balances on repossessions and mortgages, eviction or broken lease debt, some taxes, payday loans, utilities, and medical bills. Chapter 7 stops garnishments, liens, levies, and lawsuits.

In Chapter 13, debts may be repaid in an affordable 3-5 year payment plan. Moreover, Chapter 13 allows you to modify some loan agreements and even eliminate significant portions of unsecured debt. Chapter 13 allows for the repayment of only what an individual or family can reasonably afford. If your home is in foreclosure, Chapter 13 will stop the foreclosure immediately. Chapter 13 also protects your car from repossession and may also reduce the amount you owe. Even if your car has already been repossessed, your car lender will be ordered to return the car if you file within 21 days. Chapter 13 also stops garnishments, tax levies, and lawsuits. Back income taxes can be paid through Chapter 13 without further interest or penalty. In many cases, less than the full amount of the taxes may be repaid. Back property taxes may also be placed into your payment plan.

The filing fees paid to the U.S. Bankruptcy Court are $274.00 for a Chapter 13 filing and $299.00 for a Chapter 7 filing. The attorney fees in a Chapter 13 filing are capped by the court and are generally paid over the course of a 3-5 year payment plan. For Chapter 7 cases, we offer convenient payment plans to meet your needs.

Because filing for Bankruptcy eliminates your debts, your credit actually improves after filing. While the filing generally stays on your credit report for 7 to 10 years, your credit score will begin to rise right away. And the credit score is what determines whether you are eligible for a credit card, car note, or mortgage. Many of our clients begin receiving offers for credit almost immediately after filing their petitions.

In the vast majority of consumer Bankruptcy cases, clients keep all of their personal and household belongings. Therefore, it is very unlikely that any of these items will be lost.

The filing of a Chapter 13 case will stop a foreclosure proceeding immediately. The amount you are behind on your mortgage payments will be placed in your payment plan and paid back over a manageable three to five year period.

The filing of a Chapter 13 case will stop a vehicle from being repossessed. In fact, you can file a Chapter 13 case up to 21 days after the repossession and the car creditor must still return the vehicle immediately. The vehicle payment will then be paid through your monthly Chapter 13 payment. The payment allocated for the vehicle is often more manageable because the interest rate can be lowered. If your car note is more than 910 days old, you will generally only have to pay back the Blue Book value of the car.

Filing of the Bankruptcy petition serves as an automatic order to all creditors to immediately stop all collection activity.

Many times vehicles can be protected in Bankruptcy. In Chapter 7 Bankruptcy, if you're still paying on the vehicle, you can choose to reaffirm the debt and continue to make payments on the vehicle. If the vehicle is upside down and you want to get out from under the vehicle debt, you can include the debt in the bankruptcy.

If the vehicle is paid off, it still may be protected. The Illinois property exemptions allow an individual filer to exempt up to $2,400 of equity in a vehicle. Married couples who file can protect up to $4,800 of equity in one vehicle. In Chapter 13 Bankruptcy, you may have the option to cram down the amount owed on the vehicle. The cram down can be used to reduce the amount owed on the vehicle to the fair market value. The amount that is crammed down then becomes an unsecured debt and can potentially be paid at a small percentage of what is owed. Contact us for further information on how vehicles are handled under the bankruptcy code.

The plunge in the housing market has had a huge impact on homeowners in the Chicago area. Because home values for many people are now less than what is owed on the home, people are faced with tough decisions.

Mortgage companies and lenders are forced to drag their feet on modifying loans due to uncertainty about whether federal stimulus money will come through. Meanwhile, while homeowners are waiting on whether the mortgage company will modify the loan, the house continues down the road of foreclosure.

Homes can be protected in Bankruptcy. A Chapter 7 Bankruptcy will allow you to keep your home as long as you continue to make the mortgage payments. If there is equity in the property and the property is your primary residence, Illinois allows $15,000 of equity per individual, or $30,000 per married couple, to be exempt in Bankruptcy.

On the other hand, a Chapter 13 Bankruptcy will allow you to keep your home and save it from foreclosure. The Chapter 13 plan allows you to catch up on the arrears through the plan and stop any foreclosure sale dates. Contact us for further inquiries on whether your real property will be protected in bankruptcy.

We represent businesses and consumers with Chapter 7 and 13 Bankruptcy proceedings.

We will:

• Meet with you in our office to learn all the facts relating to your case.

• Explain to you all of your important legal rights and options.

• Review your financial records in order to obtain a full understanding of your case.

• Answer all of your questions regarding Bankruptcy.

• Keep you advised and informed about the progress of your case.