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What are the benefits of filing for bankruptcy?

Appleton, Wisconsin, residents have their own fair share of debts, which often accumulate from student loans, credit card debts, car loans, mortgages, child support payments and spousal support. As debtors, most residents do their part in paying off these debts in order to avoid huge interest rates that accrue if not paid on time. Consumers, though, are not the only ones who are battling debts. Many well-known businesses have debts that also need to be settled.

Filing for bankruptcy protection offers debt-relief as well as federal exemptions. Individuals and business establishments should be aware of these so they can choose the best type of bankruptcy protection that suits their unique circumstances. The recent bankruptcy filing for the sandwich maker Quiznos gives Appleton readers a glimpse into the workings of this legally binding process.

Based on a report, the restaurant chain has filed for bankruptcy protection in an attempt to reduce the company's debt by more than $400 million. Quizno's executives will be using a restructuring plan in order to recover and increase the profits of their stores. The company also plans to provide financial assistance to its restaurant chains in order for them to continue running during the course of bankruptcy protection.

In this case, one of the bankruptcy exemptions allows a business to continue operating during a bankruptcy filing. The company can take advantage of this exemption, allowing the company to grow and become profitable once again.

Similarly, individuals who are planning to file for bankruptcy, whether it is Chapter 7 or Chapter 13, need to understand that the legal process can help them maintain their standard of living. Under Chapter 7 or liquidation, not all property and assets will be liquidated to pay off debts. Some property and assets are exempt and therefore will not be affected by a bankruptcy filing.

Appleton residents who have additional questions regarding bankruptcy exemptions are encouraged talk to a legal professional about this process.

Source: CNN, "Quiznos files for bankruptcy," Katie Lobosco, Mar. 14, 2014

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