Bankruptcy Overview

Fort Worth Lawyers Helping the People of Texas

The Bankruptcy Code authorizes six different types of bankruptcies, but only four can be used by individuals. Each type of individual bankruptcy case is known by the chapter that defines it in the Bankruptcy Code: Chapter 7, Chapter 11, Chapter 12, and Chapter 13.

A Chapter 7 Bankruptcy case is the most common type of individual bankruptcy case. Chapter 7 Bankruptcy is available to all individuals in Fort Worth, to married couples, and to a spouse who files separately. Chapter 7 Bankruptcy is an erase-your-debts-start-fresh bankruptcy case. It is formally known as a "liquidation" proceeding, because (in theory) everything the debtor owns is taken and sold to pay creditors. However, it is not very practical to take everything a person owns, and many state and federal laws protect the debtor's property to the extent that only about one case in twenty pays anything to creditors in a Chapter 7 Bankruptcy. An average Chapter 7 Bankruptcy case will take four to six months to complete.

A Chapter 11 Bankrupcy case is called a "reorganization" proceeding, and is commonly used by corporations. Individuals file Chapter 11 because their debts exceed the limits for Chapter 13 bankruptcy. The bankruptcy trustee cannot take property from a Chapter 11 debtor. The debtor proposes a plan to repay debts, creditors vote whether to accept the plan, and ultimately the bankruptcy court orders a reorganization plan which binds all parties to the terms of the plan.

A Chapter 12 bankruptcy case is only available to family farmers who wish to reorganize their finances. Many provisions in Chapter 12 are similar to a Chapter 13.

In a Chapter 13 Bankruptcy case the debtor pays what he can afford each month under a court-ordered repayment plan. Creditors are grouped together in debt priorities and paid according to the availability of monthly income. Creditors are paid between zero and 100% over three to five years. Chapter 13 Bankruptcy is only available for individuals who have a regular income (Chapter 13 is also called a "Wage Earner's Plan"), unsecured debt of less than $336,900, and secured debt of less than $1,010,650. The Fort Worth bankruptcy trustee cannot take property from the Chapter 13 debtor. Chapter 13 Bankruptcy provides many advantages to Chapter 7, including the opportunity to reduce monthly vehicle payments and catch-up a delinquent mortgage.

The Bankruptcy Code offers four powerful types of bankruptcy cases to individuals. If you are struggling with debt, speak to an experienced Fort Worth bankruptcy attorney and discover how the Bankruptcy Code can help you reorganize or eliminate your debt headache.

At Fears | Nachawati, we are committed to helping people throughout the Fort Worth area regain control of their finances. Our Fort Worth bankruptcy attorneys are always willing to help you file for bankruptcy -- but first we want to make sure you understand what bankruptcy can and can't do for you. See the following pages for plenty of information about bankruptcy in Fort Worth:

  • Should I Consider Bankruptcy? There are a number of questions you should ask yourself if you are considering bankruptcy.
  • Chapter 7 or 13: Which is Right for Me? Your salary can be a big factor in determining which kind of consumer bankruptcy you undergo.
  • What Is Chapter 7? Chapter 7 bankruptcy is a relatively brief process that involves selling off many of your assets and then wiping debts clean.
  • What Is Chapter 13? Chapter 13 bankruptcy puts you on a payment plan that pays off some of your debt and then discharges the rest.
  • Saving Your Home and Car : Filing for bankruptcy can stop a foreclosure or repossession under most circumstances.
  • Protecting Your Personal Property : Most people who undergo bankruptcy do not lose much personal property, just give up a few items not deemed necessary for living.
  • How Bankruptcy Affects Debts and Lawsuits : The point of filing for bankruptcy is to either get rid of debts or find reasonable ways to pay them off. And filing for bankruptcy puts a hold on all debt-related lawsuits.
  • Rebuilding Your Credit : After and even during bankruptcy proceedings, you can begin rebuilding your credit rating.
  • Life after Bankruptcy : Bankruptcy wipes the slate clean, and after it is over our lawyers can help you start a new, debt-free life.

We also recommend our Bankruptcy FAQ, which covers much of the above information and more. And at any time, if you have questions, please contact our Fort Worth bankruptcy attorneys. We maintain office hours 7 days a week and can meet with you in the evenings or on weekends. Flexible payment plans are available.

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We are a Fort Worth Bankruptcy Law Firm. We help people file for bankruptcy relief under the Bankruptcy Code.