Bankruptcy Services in Washington, D.C.

What Do I Need to Know about Filing for Bankruptcy in Washington, D.C.?

If you are not already familiar with bankruptcy, you may understandably have several important questions. What can bankruptcy accomplish? What is the difference between Chapter 7 and Chapter 13? How would I go about filing? 

We encourage you to review the following resources to learn more about bankruptcy and what it can do for you:

• Understanding Bankruptcy Options. Review your relief options and commonly used bankruptcy phrases. 
• Eliminate Debt with Chapter 7 Bankruptcy. Chapter 7 bankruptcy eliminates all dischargeable debt, including credit card and medical debt. Non-exempt assets will be liquidated to partially compensate creditors, but you can use available exemptions to protect most or all of your property. Some debts, including student loan debt and missed child support payments, are not dischargeable.
• Reorganize Debt with Chapter 13 Bankruptcy. This type of reorganizational bankruptcy involves setting up a payment plan based on your projected future earnings. You will pay back a portion of your debts over three to five years. This form of relief can be a great choice for people who have reliable income but have fallen behind on making payments.
• Stop Foreclosure with Bankruptcy. If you are in danger of losing your home to foreclosure, bankruptcy can be used to stop the process. 
• Strategies for Managing Consumer Debt. Find out what you can do to manage your debt and how to avoid dishonest “credit repair” services. 
• Navigating the Bankruptcy Means Test. Learn how the bankruptcy means test works and why you need to use it if you want to file for bankruptcy. 
• Bankruptcy Solutions for Student Loan Debt. If you are facing extreme financial hardship, bankruptcy may be able to help you eliminate your student loan debt. 
• Bankruptcy FAQs: Your Questions Answered. Get answers to common questions about bankruptcy laws and bankruptcy types.

What Are The Main Reasons Individuals or Businesses File For Bankruptcy?

Individuals and businesses file for bankruptcy due to various reasons. Here are some of the main reasons:

For Individuals:

1. Overcoming Overwhelming Debt: Accumulation of excessive debt, such as credit card debt, medical bills, or personal loans, may become unmanageable, leading individuals to seek bankruptcy protection.
2. Navigating Job Loss or Reduced Income: Sudden unemployment or a significant decrease in income can make it challenging for individuals to meet their financial obligations, prompting them to file for bankruptcy.
3. Medical Expenses and Bankruptcy: High medical bills resulting from unforeseen illnesses, accidents, or ongoing healthcare treatments can lead individuals to file for bankruptcy as they struggle to cover the costs.
4. Financial Strain from Divorce or Separation: The financial strain associated with divorce or separation, including legal fees, child support, and alimony, may push individuals to seek bankruptcy protection.
5. Avoiding Foreclosure or Repossession: When individuals face the threat of losing their homes due to foreclosure or their assets due to repossession, filing for bankruptcy can provide temporary relief and halt the process.

For Businesses:

1. Addressing Excessive Business Debt: Businesses may accrue significant debt from operational expenses, loans, leases, or unpaid invoices, making it difficult to maintain profitability and meet financial obligations.
2. Adapting to Declining Sales or Market Changes: A decline in sales, changes in the market, increased competition, or disruptive industry trends can cause financial distress and lead businesses to file for bankruptcy.
3. Legal or Regulatory Challenges and Bankruptcy: Businesses facing lawsuits, fines, or penalties, or struggling to comply with regulatory requirements may resort to bankruptcy as a means to address these challenges.
4. Resolving Partnership Dissolution through Bankruptcy: Disputes among business partners or the dissolution of a partnership can result in financial strain, leading to bankruptcy filings to resolve outstanding debts and liabilities.
5. Recovering from Natural Disasters or Catastrophic Events: Businesses affected by natural disasters, fires, or other catastrophic events may face significant property damage, loss of inventory, and interrupted operations, necessitating bankruptcy protection to recover. 

Should I File for Bankruptcy in Washington, D.C.?

If you are facing substantial debt, our bankruptcy services in Washington, D.C., may be able to help you overcome it. However, bankruptcy should only be viewed as a last resort. You should try all other options for managing and paying your debts before considering bankruptcy. This may include directly contacting your creditors to propose some type of loan settlement or repayment plan. If you already have a repayment plan, you may be able to negotiate lower payments. It may also be wise to sell certain valuable assets to cover your debts.

You should also understand that filing for bankruptcy will negatively impact your credit. A Chapter 7 bankruptcy will stay on your credit report for up to ten years, while a Chapter 13 bankruptcy will remain for seven years. Our lawyer can analyze your unique circumstances and advise whether bankruptcy is right for you.