Bankruptcy Basics

Central Florida Bankruptcy Attorneys

Bankruptcy Basics

Bankruptcy is the judicial modification of contracts. In English, it’s a court system set up to help individuals (and businesses) get control of debt that they can’t handle on their own. Bankruptcy can help people who are overwhelmed by debt start over.

In a Chapter 7 bankruptcy, all your nonexempt assets can be used to satisfy your debts. In a Chapter 13 bankruptcy, ou enter a court-supervised payment plan to pay back a portion of your debt, while protecting you from bill collectors.

Automatic Stay

The first thing you need to know about bankruptcy is the automatic stay. The stay protects you from your creditors by stopping all attempts to collect debts from the moment you file. Collection calls, lawsuits, foreclosures must all stop immediately as soon as the automatic stay comes into effect.

Discharge

At the end of your bankruptcy case, the judge enters an order of discharge. The discharge protects you from collection of the debts included in the bankruptcy. Once the discharge is granted, you are no longer legally obligated to pay those debts.