The Law Offices of Jeffrey S Harris practices exclusively in Illinois. Although Bankruptcy cases are in the federal courts and follow are governed by the United States Bankruptcy Code, (Title 11, United States Code) the information contained herein may only apply to cases filed in Illinois. Additionally, the following information should not be used as a substitute for reference to the United States Bankruptcy Code, the Bankruptcy Rules, and the laws of the State of Illinois or to any local rules of practice adopted and disseminated by each bankruptcy court. The information contained herein may not be considered legal advice and we encourage you to seek legal counsel for evaluation of your specific situation.
There are several different types or chapters of bankruptcy depending on the circumstances and the type of debtor. However, most consumers will file either a Chapter 7 “Liquidation” bankruptcy or a Chapter 13 “Reorganization” bankruptcy.
In a Chapter 7, the debtor seeks to eliminate all unsecured debts such as credit cards, personal loans, repossessions, and medical bills, while at the same time keeping those secured items such as a house or automobile.
In a Chapter 13, the debtor will repay over time the past due amounts on secured loans such as a mortgage or an automobile. The debtor will also pay some or all of the unsecured debts. Generally, a debtor must propose to pay at least 10% of all unsecured debts for a Chapter 13 Plan to be confirmed. The repayment plan in a Chapter 13 typically runs from 3 to 5 years.