Rhode Island Bankruptcy Facts
If you are struggling with debt, you may often feel like there is no way out. However, we may have the solution for you. Our bankruptcy lawyers in Rhode Island pride themselves in helping their clients overcome their debt and will do the same for you. Bankruptcy may be a good choice for you if you have unpaid medical bills, loans, credit card statements, lawsuits, or owe money to the IRS. Our bankruptcy attorneys will take care of all your paperwork, will call your creditors and represent you in court. They will always be available to you should you have any questions and will not rest until your debt is eliminated.
To get started with a bankruptcy lawyer in Rhode Island near you, simple contact one of our featured legal professionals and schedule an initial appointment. You will be on your way toward being debt free in no time.
What is Bankruptcy?
Bankruptcy is a federal declaration by a debtor (consumer or business) that they cannot repay creditors what they owe. It was once only filed by creditors directly in order to recover the debts that were owed to them, but now, bankruptcy has become a tool that many use to reduce or even eliminate their debts and can be filed voluntarily.
The first step in filing bankruptcy protection in Rhode Island is to review to your income, debts and assets to determine whether you qualify for any of the six chapters available for debtors in Rhode Island. Depending on the chapter you seek, the requirements may be vastly different. Your bankruptcy lawyer can help you during this process and will take care of all the paperwork that needs to be filed. Once you are ready to get started, your attorney will help you choose the chapter that is best suited for your financial needs.
Which Chapter Should I File?
Determining which chapter of the bankruptcy code is best for you is no easy task. Each chapter caters to a particular type of debtor and if any mistakes are made in filing, this could cost the petitioner to incur even more debt than they started with. However, in Rhode Island, most debtors file one of two popular chapters – Chapter 7 and Chapter 13 bankruptcy protection. Read on to find out more about each individual chapter and how to qualify.
Chapter 7 or Chapter 13?
If your income falls under the average of a Rhode Island household of your size, then you may qualify for Chapter 7 bankruptcy protection. Chapter 7 is the most popular chapter because both individuals and businesses may qualify and can eliminate their debts completely in as little as 3 months. This chapter is very appealing because it provides petitioners with a “clean slate.” However, the way it does this is by liquidating the debtor’s assets. There are several items that can be exempted in Rhode Island, including the debtor’s home, personal effects like clothes and retirement accounts, but not everyone may be keen on parting with any assets. If this is your case, you may want to consider Chapter 13 bankruptcy protection instead.
Chapter 13 offers debt relief by placing debtors on a payment plan lasting between 3 to 5 years so the debtor can pay back creditors. However, this petition may only be filed by individuals. It also differs from Chapter 7 in the fact that debts are not completely discharged, but on the other hand, debtors don’t have to worry about their assets getting seized. This is a chapter more suited to debtors who have a steady income and just need a little extra time to pay back what they owe. Many debtors in Rhode Island facing foreclosure also benefit from this petition because once Chapter 13 is filed and approved, creditors may not press forward with foreclosure proceedings.
For more information on bankruptcy protection and to find out if you qualify, contact one of our local bankruptcy lawyers in Rhode Island today to discuss your best options for fast and successful debt relief.