Columbus Bankruptcy Lawyer

Filing for bankruptcy is rarely an easy decision to make. With the turbulent economy, it is a decision that more and more Americans face each day. Over 1.5 million people have filed bankruptcy thus far in 2009. It is certainly a misconception that these cases are all the result of blind overspending. Bankruptcy is often the result of medical bills, loss of employment, divorce and other unavoidable emergencies.

You deserve a fresh start, free of the hounding debt collectors and the struggle to stay above the wave of bills. With recent federal changes to bankruptcy law, it is important now more than ever to find a qualified bankruptcy lawyer.

What is Bankruptcy?

Bankruptcy is the process created through federal laws, in which a debtor, who is unable to pay creditors, gains partial or total relief from debt. Under the US Constitution, Congress is allowed to enact laws on the subject of bankruptcies throughout the United States (Article 1, Section 8, Clause 4). Creditors are prevented from continuing collection actions outside of the legal proceedings. These laws can also be beneficial for the debtors, as they can gain reimbursement through division of the debtor's assets or use of future disposable income.

There are several types of bankruptcies under the Bankruptcy Code, which can be found under Title 11 of the United States Code. They are as follows:

• Chapter 7: This is the most common form of bankruptcy to file under. An estimated 65% of all US consumer bankruptcies are filed under Chapter 7, which governs the process of liquidating assets for the repayment of creditors. For individuals, this means the collection of non-exempt property, which is distributed amongst debtors under the supervision of a trustee.

Most liens, such as those against cars and real estate, remain even after filing. If a debtor can afford to pay for a portion or all debts within the next 5 year period, a U.S. Trustee may bar the filing of bankruptcy and force the debtor to file under Chapter 13.

For businesses, filing under Chapter 7 may mean selling portions or the entirety of the company. Certain debts, such as those to mortgage lenders, cannot be discharged through bankruptcy.

• Chapter 9: This chapter only applies to municipalities seeking to settle excessive debt.

• Chapter 11: The trustee is empowered to manage the debtor's business for restructuring. If the debt exceeds current and immediate assets, ownership of the company is transferred to the creditors, leaving the debtor with nothing.

• Chapter 12: This chapter is similar to that of chapters 11 and 13, but creates additional provisions for farmers and fishermen.

• Chapter 13: This chapter creates a repayment plan for the individual debtor to repay creditors over a 3 to 5 year period. Individuals typically maintain their property while payments are made, provided they have sufficient means to pay for current living expenses. During this time, creditors cannot collect on previously accumulated debt. When the repayment period ends, debtors are discharged of the remaining unsecured debt.

• Chapter 15: This chapter involves international jurisdiction in the event of a bankruptcy filing.

Ohio Exemptions

Though states cannot regulate bankruptcy, they can pass laws that pertain to other aspects of the relationship between debtor and creditor. Ohio has exemptions in place, creating provisions for assets in homestead, insurance, pensions, personal property, wages, and public benefits.

Important among these are assets received from alimony, public employee pensions, health aids, and unemployment compensation. Ohio protections allow the debtor to keep at least 75% of future wages, a number that can be increased under the discretion of the trustee for low-income debtors.

Seek Experienced Legal Counsel

In 2002, over 78,000 bankruptcies were filed in Ohio alone. This number is only growing in our turbulent economy. If you are considering bankruptcy or have been forced into it by creditors, please seek our legal counsel. There are many options available for legal debt relief as all cases are different. Together we can work out the best solution for your situation.