Personal Bankruptcy Options
If you are filing for personal bankruptcy in Wisconsin, you need to know the two (2) primary options available for Wisconsin residents. (Wisconsin follows the U.S. Bankruptcy Code, Title 11)
Option 1: Chapter 7 Bankruptcy
Chapter 7 bankruptcy is a good choice for you if you are absolutely drowning in a sea of debt, with no hope of ever being financially free in the near future…if ever. A court appointed trustee will “seize” and sell all your applicable assets to distribute the monies evenly among the creditors. Some debts like student loans are exempt from bankruptcy and the rest, which cannot be paid in the asset distribution process, are totally forgiven. You can then make a fresh start, with the opportunity to make better financial choices in the future. However, you may not qualify for Chapter 7 — a means test will be given to prevent abuse of bankruptcy law regardless of your desires for a personal bankruptcy proceeding.
Option 2: Chapter 13 Bankruptcy
If you need to try to save a small business, home, family car, and other assets, you can opt to file a Chapter 13 bankruptcy. The court will negotiate with creditors to lower the balance of the debts. Oftentimes, creditors are willing to forego late fees or part of the interest instead of losing all repayment options relating to personal bankruptcy filings. Then, the court will calculate a new repayment plan for 3-5 years. Payments are made to the trustee, and the court, in turn, pays the creditors. However, you will not qualify if the unsecured debt is greater than $336,900, and the balance of secured debt is more than $1,010,650.
Use a Bankruptcy Attorney
Now that you know your options and you still feel filing for personal bankruptcy is your only way out of your distressed financial situation, it is advisable for you to attend bankruptcy court with the services of a bankruptcy attorney in Madison, Wisconsin. The attorney knows all of the bankruptcy laws, can answer legal questions asked by the court, can provide sage legal advice, and give you moral support during stressful proceedings, as well as give legal help so that you can prevent financial mistakes and potential legal troubles.
Filing personal bankruptcy in Wisconsin enables you to escape irresolvable debts; and a competent, experienced bankruptcy lawyer can help the bankruptcy be resolved in your best interest.