TITLE: What Is A Chapter 20 Bankruptcy?

It doesn’t take knowing all the ins and outs of the bankruptcy laws to have a little familiarity with some of the terms. For instance, most people who have heard of bankruptcy know that there is a type of case called a Chapter 7, and a type of case called a Chapter 13. You might have even heard that the minute you file a case your creditors are not allowed to call you and try to collect their debt. But even if you know some of these things, there are many intricacies to the bankruptcy laws that you will need help with if you are considering filing a case. The first step is to talk with a knowledgeable bankruptcy and debt management attorney to learn how bankruptcy can help you, and what your options are for filing a case.

One of the most important decisions to make after you decide bankruptcy is the answer to your financial problems is what type of case you will file. For consumers, there are two main types of cases. You can file a Chapter 7 or a Chapter 13. A Chapter 7 is generally the more desirable type of case because it eliminates all of your unsecured debt, and it does not last as long as a Chapter 13. A Chapter 7 is more like a liquidation of your debt, and in contrast a Chapter 13 is more like a debt consolidation. A Chapter 13 requires you to propose a plan of repayment of your debt, including repayment of a portion of your unsecured debt. While these are the most filed types of bankruptcy cases, there is also a chance you might need relief under both chapters, and this is referred to as a “chapter 20”. The characteristics of a Chapter 20 case include:

•         Firs you file a Chapter 7, but a little ways down the road find that you need additional relief from your financial pressure.

•         You are not permitted to refile a Chapter 7 under certain circumstances, and within a certain time frame, but you might be able to file another case under Chapter 13.

•         The filing of a Chapter 7 and then a Chapter 13 is sometimes called a Chapter 20, and can be helpful if you begin experiencing financial difficulty shortly after your Chapter 7 case is completed.

A lot of people wonder if they are allowed to file bankruptcy more than twice, and the “chapter 20” scheme is one of the ways this happens. If you have filed a Chapter 7 and received a discharge, but need more help with your debt load, a new case under Chapter 13 could help. Call our office to find out if you are able to do this, and if so, how it will help you better manage your money.

For more information about how bankruptcy can help you, contact us at www.law-ri.com. We will help by coming up with solutions that work for you and have multiple locations to meet your needs for office visits.