What Is Bankruptcy?


Question: I honestly don’t understand what bankruptcy is. What is bankruptcy? I have so many debts from credit card companies and loans and a car rep that I just don’t know what to do. I just got served with a lawsuit from a credit card company.

I’m losing sleep over all my debt and I’ve even thought of doing illegal stuff to get money.

L.B. in Roswell, GA

Answer: That’s a great question that many people have. Bankruptcy is a legal process that allows consumers and businesses to repay all or some of their debts under protection of the bankruptcy court or to just wipe out and totally eliminate the debts.

Bankruptcy gives people a fresh start and the bankruptcy court, under federal law, will protect you from your creditors.

Most consumers have two choices for bankruptcy: a Chapter 7 or a Chapter 13. A Chapter 7 basically just eliminates your debts.

A Chapter 13 deals with debt through reorganization and you only pay a certain percentage of what you owe. In a Chapter 13 bankruptcy, you generally keep all your property but make monthly payments over three to five years to repay all or some of your debt. This monthly payment is your debt consolidated into one monthly payment that is made to the bankruptcy trustee assigned to your case. The trustee then uses that payment to pay your debt to your creditors.

Bankruptcy can be very complicated, however, but we make it easy. All chapters of bankruptcy have many rules regarding which debts can be discharged (eliminated), who can file, how to file, and what property you can and cannot keep. You must qualify to file for any chapter of bankruptcy, and determining if you qualify is something we do for our clients. That is why we provide our clients with a financial assessment prior to filing. This avoids the bankruptcy case from being dismissed due to missing information and other factors.

About Us

Time to get a fresh financial start? Call us at (678) 712-8561.

Our experience can work for you. We’ve served as a Magistrate Judge, an Assistant Attorney General and as a Senior Assistant County Attorney. Attorneys Valerie Sherman and Bill Sherman are ready to fight for you!

We have bankruptcy clients throughout the Atlanta metro area and North Georgia.

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