Bankruptcy Attorney In Chicago, Illinois

Many people have misconceptions about secured and unsecured debts in bankruptcy. At North & Sedgwick Law, we offer a free initial consultation to answer your questions. The firm's bankruptcy lawyer, Paul Camarena, serves individuals, families and businesses in Chicago and throughout the surrounding areas of Illinois.

What Is The Difference Between Secured And Unsecured Debts?

A secured debt is one that is backed by an asset. Examples include car loans and home mortgages. If you fall behind your payments on a secured debt, the lender can take the asset, sell it and use the proceeds to pay off your loan. If the proceeds do not cover the amount you owe, then you may still owe the balance to the lender.

An unsecured debt is one that is not backed by an asset. Examples include credit card bills, hospital bills, most lawsuit judgments, student loans and many types of loans.

What Is The Difference Between Secured And Unsecured Debts?

When you file bankruptcy, you obtain a discharge of most types of unsecured debt, with the exception of student loans, past-due child support, certain taxes, restitution in a criminal case and a lawsuit judgment if you injured someone while driving drunk.

You also obtain a discharge of secured debt when you file bankruptcy. However, since the debt is secured, the lender has the right to take the asset. If you still owe the lender money after the asset is sold, any personal liability for that debt is discharged by filing bankruptcy.

Contact A Chicago Attorney To Learn About Bankruptcy Eligibility

During your free initial consultation, attorney Camarena will review your debts and explain which debts will be discharged and which assets may be taken by a creditor. To schedule a consultation simply call North & Sedgwick Law at 312-878-8429 to arrange an appointment. You can also contact the firm via email.

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†The firm is a debt relief agency and helps people file for bankruptcy relief under the Bankruptcy Code.