Lauderdale Law Office


Bankruptcy laws have been in place in this country from the beginning, in fact is specifically provided for by the United States Constitution. The guiding purpose behind bankruptcy is to give those who are deeply in debt the opportunity to get a fresh start. Without some relief like this families who fall behind in payments due to illness, or layoff, or small business that suffer reverses would have no remedy. Some limited relief is essential so that those who fall into serious financial difficulties are not left penniless.

When most people think of bankruptcy, they think of a "straight" bankrutpcy in which bills are wiped out and a person's assets may be sold for creditors. In fact there are a number of different bankruptcy programs and they are each quite different. The two programs which are available to most individuals and small businesses are Chapter 7 and Chapter 13, and these are explained in more detail elsewhere on this website. For know you should know that Chapter 7 is a liquidation bankruptcy in which some kinds of bills can be discharged, for example credit cards and medical bills, but your assets may also be put at risk, and not everyone is eligible for a Chapter 7. Chapter 13 is a reorganization bankruptcy for individuals and small businesses, and allows you to propose an affordable monthly payment to the bankruptcy court for all your bills.

There are other chapters in the Bankruptcy Code but these apply to large companies or other kinds of debtors. Chapter 11 allows corporations and large business to reorganize, and is sometimes used by individuals who have too much debt to qualify for a Chapter 13.

There are other programs in the Bankruptcy Code for cities which go bankrupt, and for farmers, but the vast majority of bankruptcy cases filed each year are filed under Chapters 7 or 13 of the Bankruptcy Code.

Lauderdale Law Office
150 Carmelito Avenue
Monterey, California 93940
Phone: (831) 646-1306
Fax: (831) 646-1615

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