Taking A Look At Bankruptcy In Massachusetts
Bankruptcy in Massachusetts, and what a filing means, might be a subject worthy of study in this day and age, when times are tough everywhere. This includes the Bay State, too. And even though an economy in most circumstances might be going along well, it’s still the case that people may find themselves in rough financial straits for various reasons. In this regard, knowing a bit about bankruptcy could be important.
Keep in mind that the U. S. Congress made a number of changes (25 of them, to be exact) to the federal bankruptcy laws that govern bankruptcy throughout the nation. These changes were made in 2005, meaning that certain older practices may not now be valid. Additionally, each state has ensured that certain exemptions to the federal law have been placed on the books that also govern what most hope is a very last resort financial action taken by people.
In Massachusetts, certain classes of property are exempt from execution of a bankruptcy judgment. There’s no simple formula that a person can use to determine when he or she should file for bankruptcy, it must be said. It might depend on a variety of factors, including possible foreclosure on a home or property or maybe a job loss.
Whatever the reason for filing might be, it’s also smart to understand that there are two different kinds that can be filed for in Massachusetts and every other state; Chapter 7 (sometimes called “clean slate” or “liquidation” bankruptcy) and Chapter 13 (sometimes called “Wage Earner Bankruptcy”). The kind of bankruptcy option that should be selected depends on what’s trying to be done on the part of the filer in accordance with bankruptcy laws.
In general, Chapter 7 is a liquidation and will wipe out all debts except those listed and is a way to get a fresh start. There’s a means test, a hearing and then a decision. If it’s positive, a trustee will begin an asset sale (on property not exempted by the court) and then a payoff to creditors. Chapter 13 is similar to a corporate bankruptcy, reorganization and then reemergence with a repayment plan.
Bankruptcy in Massachusetts filings begin with an official petition, a schedule and a statement of financial affairs, all of which are filed with the federal bankruptcy court. The Chapter 7 filing fee is $299 and the process can be quite intrusive in terms of personal and financial information that’ll need to be supplied. In most cases, it’s best to work with an experienced bankruptcy attorney when thinking of going this route.
Facing the prospect of bankruptcy in Massachusetts can be scary. It’s critical that you have confidence in your decision making and a qualified bankruptcy law firm MA can help guide you down the right path.