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Bankruptcy in a Nutshell

Bankruptcy is a federal procedure that allows a debtor (the person who files bankruptcy or a business) to discharge his or her debts, or repay those  debts under a supervised bankruptcy plan.  For consumers, there are two primary types of bankruptcy: Chapter 7 bankruptcy and Chapter 13 bankrutpcy.  Chapter 7 bankruptcy will allow a consumer to discharge or eliminate most classes of debt, and generally lasts about 90 days; a Chapter 7 bankruptcy is generally known as a “liquidation” bankruptcy.  On the other hand, a Chapter 13 bankruptcy is a “reorganization” bankruptcy, whereby a debtor makes monthly payments into the bankruptcy plan for 3-5 years, based on what the debtor can afford. In a Chapter 13 bankruptcy, some debts must be paid in full, while other debts may be partially paid or paid not at all depending on a debtor’s specific circumstances.

As soon as a debtor files either chapter of bankruptcy, an “automatic stay” is triggered, which essentially is a restraining order against most of the debtor’s creditors from continuing to collect a debt, pursuing a lawsuit, or garnishing the debtor’s wages or bank accounts. In certain circumstances the bankruptcy stay may be lifted, or may not apply at all depending on the type of creditor.

Most debts will be discharged as a result of a bankruptcy, such as medical debt, credit card debt, and so on.  Some debts may not be discharged as part of a bankruptcy, meaning these debts continue.  Such debts may include student loans, child support, certain tax debts, and so on.

If you would like to learn more about how bankruptcy may improve your financial situation, please call today to schedule your free in-office bankruptcy consultation here in Eugene.

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Tom Butcher

Tom Butcher

Tom Butcher is the owner and attorney at Butcher Law Office, LLC. He represents clients in financial distress in Chapter 7 Bankruptcy and Chapter 13 Bankruptcy. Tom offers a friendly, respectful, and compassionate experience for clients who are in financial and legal distress. Rather than taking a mechanical approach to filing bankruptcy for clients, like other bankruptcy firms, Tom strives to offer a personal, one-on-one experience, where the client’s situation is of utmost importance. Tom believes this personal attention keeps him connected to the community, and serves his clients best during their bankruptcy.
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