Bankruptcy Basics in Pennsylvania

Pennsylvania Bankruptcy Basics


Bankruptcy law in Pennsylvania is a legal status for people or entities that cannot repay their debts. Filed in federal courts under rules outlined in the U.S. Bankruptcy Code, bankruptcy is commonly known by the chapter of the code it references, like Chapter 7 and Chapter 13.

When creditors in Pennsylvania are threatening to take away assets (like homes, cars, jewelry, or money from a bank account or tax return), or if creditors are simply in the process of doing so, individuals may avail themselves of bankruptcy protections. These protections can help stop collections and all asset recoveries, and may even allow for the return of some of those assets. Please call a knowledgable bankruptcy attorney at the Law Office of Michael Alan Siddons in Pennsylvania to assess your particular situation and determine if bankruptcy is right for you, and if so, discuss the proper timing.

Bankruptcy Basics in Pennsylvania
Intent of the Law

Bankruptcy laws in Pennsylvania were developed to help prevent debtors (the people or entities that owe money) from becoming destitute by the actions of creditors (the people or entities you owe money to). The laws were also designed to help give debtors more time, thus allowing them to either reorganize their finances or find a way to settle their debts. This often allows the debtor to get a fresh start and still maintain possession of some of their assets.

Types of Bankruptcy in Pennsylvania

There are several forms of bankruptcy available, and which form applies to you depends on your particular situation and who you are (i.e. individual, corporation, non-profit charity, municipality, religious organization, etc.) The most common forms of bankruptcy in Pennsylvania are discussed below.

Types of bankruptcy in Pennsylvania

Bankruptcy For Individuals in Pennsylvania:

  • Chapter 7 –Also called “fresh start bankruptcy,” allows you to discharge your debts, but you must liquidate non-exempt property to pay your creditors.
  • Chapter 13 - Known as the “wage earner plan,” Chapter 13 is called a reorganization, and allows you to keep valuable property if you are able to make the necessary payments.

Bankruptcy For Businesses in Pennsylvania:

  • Chapter 7 – This form of bankruptcy can be used by businesses to liquidate your assets.
  • Chapter 11 – Used to reorganize the structure of your business.
Bankruptcy Lawyers in Pennsylvania

Other Forms of Bankruptcy in Pennsylvania:

  • Chapter 9 – Used by municipalities, including cities, towns, taxing districts, school districts, etc., to reorganize.
  • Chapter 12 – This form is for family farmers and fishermen to provide debt relief.
  • Chapter 15 – If parties are involved from more than one country, this form of filing is required.
  • Other Options – This list is by no means definitive. Please contact the Law Office of Michael Alan Siddons, Esquire, to review other possible options that pertain to your particular needs.

Bankruptcy Lawyers in Pennsylvania

Individuals in Pennsylvania can file for bankruptcy pro se (without a bankruptcy lawyer) but because bankruptcy in Pennsylvania often has long-term financial and legal consequences, even the United States Courts highly recommend you seek legal counsel from a qualified bankruptcy lawyer. But being a good bankruptcy attorney requires a broader knowledge base and experience than just having a solid background in bankruptcy law. There are other options that must be discussed, and being steered towards bankruptcy without reviewing those options could cost you your ability to litigate in state court.

Forms of Bankruptcy in Pennsylvania

Other Options to Bankruptcy in Pennsylvania

Bankruptcy should be and is the option of “last resort.” Often times, you may have other options, like mortgage loan modifications. In some cases, like if you have no non-exempt property or wages, you may not even need to file bankruptcy at all, because there is nothing that creditors can take away from you, despite all their threats. Nor can you be threatened with jail time for civil debts (other than court ordered fines.) Seeking a good bankruptcy attorney can make sure you are aware of all your rights and options.

Call the Law Office of Michael Alan Siddons, Esquire at (610) 255-7500 in PA, (609) 285-3999 in NJ or (410) 705-0970 in MD to discuss your options and rights during bankruptcy.

Options To Bankruptcy in Pennsylvania
CONTACT AN EXPERIENCED BANKRUPTCY ATTORNEY TODAY!