Bankruptcy Center of Illinois

Bankruptcy is a legal proceeding in which a debtor can obtain a discharge of certain debts. You initiate bankruptcy by filing a petition under the appropriate chapter in bankruptcy court. Most individuals file under Chapter 7 or Chapter 13 of the Bankruptcy Code. Businesses may also file under Chapter 11, which is a reorganization bankruptcy.

The filing of a bankruptcy petition triggers an automatic stay. While the automatic stay is in effect, your creditors will be prevented from trying to collect debts that you owe. Your assets will be evaluated by a trustee, and they may be liquidated, with the funds used to repay some of your outstanding debt. Certain debts are non-dischargeable, such as alimony, child support, and some taxes. While bankruptcy can give you a fresh start, it stays on your credit report for a period of time. A bankruptcy attorney in Chicago can advise you on which chapter may be right for you.