If you are considering filing for Chapter 7 or Chapter 13 bankruptcy, you may be on your way to personal and financial freedom you have not felt in many months or even years. Bankruptcy laws can be complex, and you will probably have a lot of questions during the process.
You may wonder if you will have to give up all your materials items such as your home, car, and valuables, and the answer to that is usually no—unless you have such substantial amounts of non-exempt equity built up that the trustee decides to sell off one of your larger assets. The other main question most individuals filing ask is how much debt will be discharged (or paid off in Chapter 13) and what will remain later.
Unfortunately, there are some debts that cannot be discharged in bankruptcy. Historically, recent taxes tend to fit into this category as they are priority debts; however, some tax debt that is three years or older may be discharged in some cases. If you have federal liens connected to such tax debts, that debt is considered secured in most cases. In Chapter 13, debtors are usually required to pay off secured and priority tax debts in full as part of the monthly repayment plan to the trustee.
In filing for Chapter 7 you may see all unsecured debts
discharged within five to six months, but you must be eligible to file for this
type of bankruptcy. In the state of Georgia, you are eligible if your income
falls under the median income. The median income is based on the number of
people in your household and figures published by the government. If you are
above median income, you might qualify for Chapter 7, but additional
information will be needed to make that determination. Otherwise, you will need
to file for Chapter 13 bankruptcy, which means paying back your debt over three
to five years. Although this may seem more challenging than Chapter 7, if you
have a suitable amount of disposable income, with this type of bankruptcy you
can keep your property and assets and pay off your outstanding debts through
monthly payments to the bankruptcy trustee.
Bankruptcy has the ability not only to reduce or eliminate your financial troubles, but also enormous amounts of stress—especially as the automatic stay goes into effect as soon as you file, in most cases. With this injunction, you are granted immediate relief from the constant phone calls and mail from creditors and debt collectors. By law they cannot contact you during the bankruptcy period—and you may even be able to stave off foreclosure on your home or repossession of a vehicle too. The automatic stay may not apply if you have had a prior bankruptcy case in recent years. An experienced bankruptcy attorney can help you determine whether the automatic stay will apply to help you.
You probably have many questions about bankruptcy, including which type of bankruptcy will work best for you, how much you will have to sacrifice (very little in many cases), and whether you will have to go to court. Speak with a skilled bankruptcy attorney from the offices of H. Lehman Franklin, P.C. Call now to learn more at 912-764-9616, or contact us online.