In our experience, most bankruptcy clients are just like us: normal, hard-working people who do their best to pay off their debts. Sometimes, however, it can become impossible to pay off debt and still have money left over for necessities—especially after experiencing job loss, divorce or serious illness. Living in debt also prevents us from saving for future emergencies or expenses like college for our kids or even our own retirement. That is where Iowa bankruptcy law comes in.
Once you retain us as your bankruptcy attorneys, you can direct creditor calls to our office (no more harassment on your cell phone from creditors!) while we work to file your bankruptcy and prepare you for a fresh financial start. We will look at your individual situation to determine which type of bankruptcy is right for you.
Chapter 7: Chapter 7 or “liquidation” is full discharge with no repayment. For most people the liquidation part is theoretical since they don’t have valuable non-exempt assets. Iowa exemptions, when properly claimed, protect all of your assets including your home, cars, retirement, furniture, bank balances, etc. Most Chapter 7 cases are “no asset” meaning you do not lose anything and creditors are not paid anything from the bankruptcy estate.
Chapter 13: Chapter 13 or “repayment” involves paying a portion of your debt over three to five years. IRS collection guidelines are used to determine how much you are required to pay to maintain a standard of living.
Chapter 12: Chapter 12 bankruptcy is another subset or type of bankruptcy. It is only available to family farmers or family fishermen. Designed as a response to difficulties suffered by farmers and fishermen in the 1980s, it is very similar to Chapter 13 but provides more flexibility in making periodic payments to take into account the seasonal nature of many farming or fishing operations.
Courts consider bankruptcy the responsible thing to do when you can no longer pay your bills. Otherwise, you would continue to acquire debt that you are unable to pay. When you file bankruptcy, you are agreeing to be responsible for all future debts, even if you cannot pay past debts.