Seeking Legal Advice for Insolvency: The Basics

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It’s important to acknowledge that declaring insolvency is not an admittance of failure. It’s also not an ‘immoral or unethical’ method of getting away from debts. Remember that you’re not the only one who needs insolvency protection. Other people also require legal help to structure their debt settlements and to realign themselves and be better off financially.

An Encino bankruptcy lawyer can offer many services to address these financial problems. Based on the situation and needs, legal experts can provide their services, especially in cases where assets and businesses need to be protected to ensure financial stability during and after the insolvency process.

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According to Hamid Soleimanian, the following are some of the services that can be of benefit to clients:

  • Creditor Negotiation – First, the Encino attorney must declare that bankruptcy is the best solution for the individual or the business. It’s possible that the attorney may feel that debt consolidation is a better option. In this case, he can help negotiate with the creditors and come up with a workable payment plan.
  • Personal Clients – There are two basic methods if the individual is personally in debt and/or is the sole proprietor of his business and the adviser claims that declaring insolvency is the best option. The legal expert will explain both the options – Chapter 13 and Chapter 7 – and choose the best option mutually.
  • Business Clients – Corporations, partnerships, and incorporated entities that require insolvency protection, either forced by their creditors or of their own choice, also have two options. The legal adviser will explain and recommend either Chapter 11 or Chapter 7, after explaining the details to the individuals involved. Chapter 7 is for those individuals and businesses that are willing to sell assets to pay off their debts. These assets should be the ones that aren’t protected under the federal law. In Chapter 11, the debts should be planned to be paid off from future earnings. The business can keep its assets and remain functional. In Chapter 13, if the individual or his business is able to allocate money exclusively to pay debts over a period of time, this option is viable. Clients can keep some funds for their own use too.
About Eleanor Sharp
Eleanor Sharp is the author of AGSE Law. As a paralegal, she has worked with attorneys in many fields to ensure their clients get the best advice and representation. She is passionate about helping people understand the complexities of the legal system so they can make better decisions for themselves. Eleanor loves reading, travel, and spending time with her family. She hopes her articles will help others navigate life’s legal intricacies with confidence.