When bankruptcy is the best option, we help you choose the right form of bankruptcy for the benefit of your family. Our office provides comprehensive guidance to families through the following forms of bankruptcy:
Chapter 7 Bankruptcy
Chapter 7 is available to both individuals and businesses, Chapter 7 is often called “straight bankruptcy” because it attempts to cancel as many debts as possible and to sell off any assets that cannot be protected to pay off some outstanding unsecured debt before discharging all debt allowed under the law.
Chapter 7 usually takes around 6 months. A $335 filing fee is required to file your chapter 7 bankruptcy petition with the court. A person may file chapter 7 if the pass the “Means Test”.
Congress created a test called “the means test” which helps determine whether an individual’s income to debt ratio is sufficiently low enough to warrant a Chapter 7 discharge. It is important to note that only debtors with primarily consumer debts – not business debts – are required to pass the means test before initiating a Chapter 7 bankruptcy.
After filing something called the “automatic stay” is put into place. The automatic stay immediately stops most creditors from trying to collect what you owe them. So, at least temporarily, creditors cannot legally grab (“garnish”) your wages, empty your bank account, go after your car, house, or other property. Here is more information on chapter 7.
Chapter 13 Bankruptcy
Chapter 13 is often referred to as wage earners bankruptcy because it offers an opportunity specifically for individuals who are earning an income to restructure their debt and pay it off under new terms—typically over a 36 or 60 month period. When individuals meet the requirements for Chapter 13, they can emerge with many of their assets as they start a debt-free new life.
Chapter 13 is often the right choice when a debtor cannot pass the means test. A person may be sinking in debt, but their income may be too high for straight bankruptcy. Chapter 13 will allow them to repay some of the debt while leaving enough money in their pocket for living expenses.
Chapter 13 may also be the right choice when a person has an asset the trustee could sell if they filed chapter 7. In most cases this asset can be protected by filing a chapter 13 bankruptcy.
Chapter 13 can be started by paying a filing fee of $310 to file your petition and plan with the court.
Bankruptcy is a great opportunity to get a fresh start in life. If debt from credit cards, medical bill, student loans, cars, and your mortgage are causing you to pay just the minimum payments each month you need to find a way to get a fresh start. Call us today to discuss your bankruptcy options. More information on Chapter 13 here.
Call 404-913-1527 for a free initial consultation.
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