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Filing for bankruptcy can be a difficult decision for residents of the state of Maryland, as bankruptcy filings can blemish a person’s credit record for many years. However, many Maryland residents have found that bankruptcy protection is a very useful tool in helping them to manage their debts in a way that allows them to get back on track to financial sustainability. Debts incurred due to mortgages, student loans, business practices, medical bills, or other common everyday life situations can quickly cause a person to find themselves overwhelmed by the amount the owe, causing them to not be able to pay back their bills on time or at all. Bankruptcy protection offers these people an option to eliminate or reorganize their debt and help them to get back on their feet.

Causes Of Bankruptcy In Maryland

Maryland residents face the same financial hardships as other Americans. According toresearch regarding causes of financial strain that is severe enough to lead to filing bankruptcy the most common causes of bankruptcy are:

Medical bills

Job loss


Death of spouse (especially if there is no life insurance and the primary earner died)

Excessive use of credit

Regardless of what led to your financial instability you should reach out to our Baltimore bankruptcy attorneys immediately. The sooner they get involved on your behalf the sooner you obtain the debt relief you need.

Types Of Bankruptcy In Maryland

There are 3 key types, or chapters, of bankruptcy in the state of Maryland that are most often cited in common bankruptcy cases. These chapters are chapter 11, chapter 7, or chapter 13 bankruptcy, and each chapter has its own specific situations it pertains to, as well as its own benefits that it provides.

Chapters 7 and 13 bankruptcy are considered personal chapters of bankruptcy, and these types of bankruptcy filings are most often done by individuals who wish to consolidate or eliminate their personal debts. The type of bankruptcy a person may consider filing is entirely dependent on their particular situation or cause for filing.

Chapter 11 bankruptcy is geared towards businesses, and this type of bankruptcy allows a business a way to effectively pay back their debts that also allows them to stay afloat. Businesses that have fallen on hard times or that have made less than successful choices may file for this type of bankruptcy in order to help them to pay back their creditors while keeping their business open and able to make a profit.

Chapter 7 Bankruptcy

Chapter 7 bankruptcy is also known by a term called “straight bankruptcy” as it allows the individual to completely eliminate their debts through the liquidation of their personal assets. Some debts may still exist after filing for chapter 7 bankruptcy and these include:

  • •          Support payments
  • •          Student loans
  • •          Tax liabilities

For those who have been residents of the state of Maryland for  2 years of more, they are also entitled to keep a limited amount of assets from liquidation should they choose after filing for chapter 7 bankruptcy. These liquidation exemptions are limited to $12,000 worth of goods for a single individual, or double that with $24,000 for a married couple, and these exemptions can be anything from clothing and furniture to saved cash.

However, if a person files for chapter 7 bankruptcy in the state of Maryland in order to eliminate their debts, they are no longer eligible to file for chapter 7 bankruptcy again for a span of 8 years prior to their first filing.

Chapter 11 Bankruptcy

Chapter 11 bankruptcy differs from chapters 7 or 13, as this chapter is reserved for business purposes. Chapter 11 bankruptcy allows a business owner to reconsolidate or reorganize their assorted debts in order to ward off creditors and keep their business afloat. The business filing for this chapter of bankruptcy is able to keep all of their assets and also pay back their creditors using a structured payment plan. This option allows struggling businesses to remain open while overcoming financial hardships. The debt a business may have under chapter 11 bankruptcy in the state of Maryland is unlimited, and any size business may file for this type of bankruptcy protection.

Chapter 13 Bankruptcy

Chapter 13 bankruptcy is much like chapter 11 bankruptcy, as it allows for debt consolidation and structured payments, except that chapter 13 bankruptcy is geared towards individuals rather than businesses. People who want to keep their assets while finding a way to effectively pay back creditors can file for this type of bankruptcy in order to reorganize and begin to effectively pay off debts.

The payment plans associated with chapter 13 bankruptcy typically last between 3 and 5 years in time, and when the payment plan is complete, the person filing is left with a fresh start in which to begin handling their finances.

Filing Bankruptcy And Credit

If an individual chooses to file for bankruptcy in order to consolidate or eliminate their debts, the filing will show on their credit report for a period of about 10 years. It is always recommended that a person’s credit reports remain up to date to avoid any further credit conflict resulting from filing for bankruptcy protection.

A Bankruptcy Lawyer Is Always Recommended

Due to the various laws, rules, and other various stipulations revolving around filing for bankruptcy, it is always important that any individual or business hire a skilled bankruptcy lawyer to assist in the case. A bankruptcy lawyer will be able to assess any individual situation and determine if filing for bankruptcy is in their client’s best interest, as well as which chapter may be best suited for their particular situation.

Bankruptcy lawyers in the state of Maryland will also often help with the complicated filing process of bankruptcy petitions, allowing the individual to rest assured that their petition and all personal financial information has been submitted correctly to their local bankruptcy court. The importance of a bankruptcy lawyer in cases of personal or business bankruptcy filings should never be understated, and their services should always be sought to ensure a smooth and fair process.

Contact Our Maryland Bankruptcy Lawyers

Do not hesitate to contact our experienced Maryland bankruptcy lawyers today for a free consultation.  With over 2 decades combined experienced practicing bankruptcy law in Maryland our debt relief attorneys have what it takes to help you through this trying time.

To discuss how our Maryland bankruptcy lawyers can help you through this trying time please contact our Maryland lawyers for a free initial consultation. We proudly serves those facing legal issues in the Annapolis, Baltimore, Bel Air, Bethesda, Bowie, Cambridge, Centreville, Chestertown, College Park, Columbia, Cumberland, Denton, Easton, Edgewater, Edgewood, Elkton, Ellicott City, Essex, Frederick, Gaithersburg, Germantown, Glen Burnie, Greenbelt, Hagerstown, Hanover, Havre De Grace, Hyattsville, Joppa, La Plata, Lanham, Landover, Leonardtown, New Carrollton, Oakland, Oxon Hill, Prince Frederick, Princess Anne, Rockville, Salisbury, Snow Hill, Takoma Park, Towson, Upper Marlboro and Westminster, Maryland areas.