As many Texas business owners might be aware, Chapter 11 bankruptcy, or debt reorganization, is a debt relief option that many commercial entities select when those entities are unable to sustain business profitability and cannot cope with the burden of overwhelming debt. Typically, in the event of a Chapter 11 filing, the United States case trustee appoints a creditors' committee. The committee is usually composed of the seven largest creditors, and it plays an important role in facilitating the debt reorganization process.
Bankruptcy filing in a community property state like Texas
Residents of Tyler, and other parts of Smith County, probably know that Texas is among the nine community property states in the country. In a community property state, both spouses have equal rights over assets that are acquired during the course of their marriage. The same rule applies when it comes to debts. Therefore, it is important for all Texas residents to remember that in the event of a personal bankruptcy filing, those community property laws play a major role.
Chapter 13 bankruptcy helps people cope with student loan debt
Overwhelming debt is a problem plaguing many people in Smith County, Texas, and residents throughout the country. While people have accumulated debt through credit card spending, debts arising from medical emergencies or following the loss of a job and income, many people are financially struggling with student loan debt. According to the Consumer Financial Protection Bureau, the nationwide student loan debt is an astounding $1.2 trillion dollars in the United States.
Be mindful if you are filing for Chapter 7 bankruptcy
Chapter 7 bankruptcy is one of several ways in which a person under the burden of overwhelming debt can obtain relief. As many Tyler, Texas, residents may be aware, in a typical Chapter 7 filing, all non-exempt assets of a debtor are liquidated in order to repay debtors. After those debts are repaid, the individual obtains a discharge from all debts, except for certain financial obligations -- such as child support, alimony and certain non-dischargeable taxes.
