Bankruptcy in Illinois: How can you find relief

Bankruptcy in Illinois? Here’s what you need to know. Bankruptcy is a legal process where you can find relief from your financial woes. This relieves some, if not all, of your debts. In Illinois, there is a “Bankruptcy Code” that is governed by federal law. It is administered through a federal court division – the United States Bankruptcy Court.

What are the types of Bankruptcy in Illinois?

Another key point you need to know is that there are two main types of bankruptcies that you can file in Illinois:

1. Chapter 7 is also referred to as liquidation cases.  To file for Chapter 7 bankruptcy, you must prove that you earn below the median income in Illinois. If you earn above the median, you can still file but must pass a second test – your expenses and debts will be considered.
2. Chapter 13 is “debt adjustment” or “wage earner” cases. To qualify for this, you must prove that you have a consistent flow of income and can make payments under your repayment plan.

How to file for bankruptcy

Basically, filing for bankruptcy need not be a complex process. There are steps you can follow to help you go through it and manage the steps on your own. Here are the basic steps:

• Get all the necessary financial documents that are related to your bankruptcy application – pay stubs, bank statements, tax return, vehicle registrations, and the likes.
• Fill out the forms and ensure that everything is in order.
• Go through the necessary counseling sessions.
• File your bankruptcy petition in court.
• Meet with creditors.
• Complete the debtor education course.
• Receive your discharge.

Why should you file for bankruptcy

Bankruptcy should be your last recourse even if this can give you relief from harassment from creditors and the different collection actions that can be made against you. Generally, it can also stop repossessions, wage garnishment and foreclosures, utility shut-offs because of non-payment and your driver’s license can be reinstated if it was suspended because of your debts. All in all, if you need it, filing for bankruptcy in Illinois isn’t that hard if you know how to do it.