The Law offices of J. Vincent Perryman


What is Bankruptcy?

Bankruptcy in Memphis

Bankruptcy is a legal system in the United States that serves to give people a fresh start in regards to debt. It is a way to eliminate or offer relief from overwhelming secured and unsecured debt that a person or business have accrued. Bankruptcy courts are part of the federal district court system and thus found in all of the United States federal districts. There are several options when filing for bankruptcy but the three most common are Chapter 7, Chapter 11 and Chapter 13. They are divided into two types: liquidation and reorganization. Bankruptcy doesn’t always eliminate debt, but in some cases offers ways to reorganize the debt. Watch a video on Bankruptcy.

What is Secured and Unsecured Debt?

Secured debts are connected to an asset, like a car or house that is considered collateral for the loan. Unsecured debts are just the opposite; no collateral is offered up in place of the loan. Lenders do not have the right to any of your property. Most credit cards are considered unsecured debt.

What is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy is a type of liquidation for consumers and businesses in Memphis. This means that some of your property may be sold or repossessed in order to pay the loan back. Depending on the Tennessee state laws, some of your property may be exempt from liquidation. Chapter 7 bankruptcies typically last three to six months before they are finalized and will stay on your credit report for ten years. In this type of bankruptcy, most if not all of your unsecured debt is erased. You have a few choices with secured debt; it can be repossessed by the creditor, paid off in a lump sum or you may be able to continue payments if the creditor agrees.

What is Chapter 11 Bankruptcy?

Though Chapter 11 bankruptcy is available to any person or company it is most often used by corporate entities. Like Chapter 13, it is a reorganization bankruptcy. In a Chapter 7 bankruptcy a business would cease to exist where in Chapter 11 the business would continue with the debtor in control but subjected to jurisdiction of the court. This type of bankruptcy can take months or years depending on the depth of the bankruptcy.

What is Chapter 13 bankruptcy?

Chapter 13 bankruptcy is a type of reorganization of your debt that is managed by the bankruptcy court. With this type of bankruptcy you are required to set up payment plans that you will stick to for the next three to five years. This payment plan is based on your current income. Reliable source of income is required when filing a Chapter 13 bankruptcy. The federal courts set a limit that is reevaluated and adjusted routinely to allow for cost of living increases. These debts are currently $1,010,650 for secured debt and $336,900 for unsecured debt. If your debt exceeds these limits you may be required to file a Chapter 11 bankruptcy. Chapter 13 allows for you to include missed payments to avoid repossession. For example: if you’ve missed a few mortgage payments, you can include these in your bankruptcy to avoid foreclosure.

What Can a Bankruptcy NOT Do?

Bankruptcy laws were put in place to offer an escape from debt but not all debt is covered. Some debts like child support, alimony, and tax debts cannot be eliminated. Items not listed in your bankruptcy, as well as personal injury debts (owed from a civil case in which you were found guilty and owe money) and penalties/fines for violating the law won’t be excused in bankruptcies. Student loans can be forgiven, but it is very difficult to do and doesn’t always work. A person has to prove ‘undue hardship’ and that they couldn’t pay back the loans now or in the future. Bankruptcy also cannot keep your property from being repossessed. In some cases you are required to relinquish ownership to the creditor.

How Can I Find a Good Memphis Bankruptcy Lawyer?

There are several ways to go about finding a good Memphis bankruptcy attorney. Local bankruptcy courts in Shelby County and Tennessee state bar association may help to point you in the right direction. The internet is an invaluable tool when looking for a bankruptcy lawyer. Most lawyers that specialize in bankruptcy will come up under a search for the term. If thinking of filing for a bankruptcy it is always best to consult or hire an attorney who knows the ins and outs of the legal system.

If you would like more information or if you are in need of legal advice or legal assistance, please contact a Memphis Attorney.

4719 Spottswood
Memphis, TN 38117

PH: 901-347-0647
FX: 901-255-0745

Use your smart phone to locate or call us...

QR Code

Rate us on Google Places...
- View All CLEs -
Upcoming Continuing Legal Education Sessions
Memphis Attorneys   Memphis Probate   Memphis Estate Planning   Memphis Criminal Law
Legalease Episodes    Memphis Nursing Home Neglect
super lawyers badge Avvo tax badge Avvo probate badge Avvo estate planning badge The Law Offices of J. Vincent Perryman
4719 Spottswood, Memphis, TN 38117
Ph: 901-347-0647
Fx: 901-255-0745

Providing legal services for Memphis Tennessee and surrounding areas.
Memphis lawyer and Memphis attorney services.
Disclaimer: Use of this website does not create an attorney-client relationship.