Everyone has heard of bankruptcy. Sounds like the solution to all our money problems! Unfortunately, it can be a little more complicated than it seems. In recent years, well over half a million Americans file for bankruptcy. However, many people do not realize that there is a separate court system to handle bankruptcy cases.
The U.S. Constitution authorizes laws regarding bankruptcy and Congress has duly passed and repeatedly amended those laws. Bankruptcy courts have been set up to help administer these bankruptcy laws. Bankruptcy courts are part of the federal court system.
There are nearly 100 federal districts across the United States. Each district maintains its own bankruptcy court. Bankruptcy court judges have the authority to decide any matter connected to a bankruptcy case. These can include a person’s eligibility to file bankruptcy and whether a debtor should be able to discharge their debts.
Filing for Bankruptcy can do more harm than good if not done correctly. Those bills you were hoping to be rid of may very well fall into an exception, depending on what type of bankruptcy you file. Most cases are filed under the three main chapters of the Bankruptcy Code, which are Chapter 7, Chapter 11 and Chapter 13.
However, there are also three other types of bankruptcy courts, all of which are listed below. As much as 65% of individual consumer bankruptcy filings are Chapter 7 cases. Federal courts are the only courts that can hear bankruptcy cases. This means that a bankruptcy case cannot be filed in a state court. The different types of bankruptcy cases, and a brief description of each, are:
Common Types of Bankruptcy:
Less Common Types of Bankruptcy:
As with any other court, it is a good idea to hire an attorney to represent you. Bankruptcy laws are detailed and confusing, and having an experienced bankruptcy lawyer increases your chances of success.
Last Modified: 05-13-2014 04:18 PM PDTLaw Library Disclaimer
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