fbpx AIzaSyCuK3Ucgvu8ezvMRfG4TlCl4IJeXtWiWdA
Category

Bankruptcy Law

Alabama Chapter 7 Bankruptcy Requirements

By | Bankruptcy Law, Chapter 7 Bankruptcy, Uncategorized | No Comments

 David S. Clark is an experienced Auburn and Opelika Bankruptcy Attorney that understands the intricacies of Chapter 7 Bankruptcy. 

What is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy is a type of bankruptcy that allows any Auburn or Opelika Resident to discharge debt involved with medical bills, signature loans, credit cards, or any other unsecured debts. 

If you are an Auburn or Opelika resident struggling with a lot of debt or difficult financial times, Chapter 7 bankruptcy could provide the fresh start you need.  

Ultimately, chapter 7 bankruptcy will help you liquidate a portion of your assets in order to pay off creditors. While the process sounds simple, bankruptcy can be a complicated and stressful action that requires the knowledge of a professional Bankruptcy attorney. 

David S. Clark is an experienced bankruptcy attorney that understands the stress that comes with financial hardship. For more information on Chapter 7 bankruptcy and how you can navigate the weight of debt, contact David S. Clark today

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

What Happens When I File for Chapter 7 bankruptcy?

One of the great benefits that bankruptcy provides is a court-ordered action known as the Automatic Stay which stops all forms of debt collection from creditors, immediately. 

Yet, before you file for bankruptcy it is important to know that bankruptcy does not mean the end of your finances forever. Rebuilding your finances is hard, but having the support of an experienced bankruptcy attorney could provide the help you need to do it. 

When you decide to file for bankruptcy, you will need to sign a petition and file it with your local bankruptcy court. This petition includes a detailed list of your creditors, the nature and amount of their claims, your income, and assets, as well as a layout of all of your expenses. 

After you file for bankruptcy, an appointed trustee will go over your creditors and their claims, the source, frequency, and amount of your income, all of your property, and a detailed list of all of your expenses in order to remove any suspicion of fraud.

How Do I Qualify For Chapter 7 Bankruptcy?

Qualifications for Chapter 7 Bankruptcy begin with the submission of your average income, along with any assets or unexpired leases that you have. Your bankruptcy attorney will then go over any property that you have to help you liquidate your assets. 

In the midst of bankruptcy, there may be necessary assets that are unable to be liquidated. This means any liquidation of those assets will cease and creditors will need to be reaffirmed that you owe the amount of any necessary assets. If the amount you are trying to reaffirm is large enough, or if you are trying to reaffirm multiple unsecured debts, Chapter 7 bankruptcy may be disapproved. 

What can a Bankruptcy Attorney do for Me?

David S. Clark is an experienced Auburn and Opelika Bankruptcy Attorney that understands the intricacies, complications, and stress that bankruptcy presents. If you need help navigating Chapter 7 bankruptcy, contact David S. Clark today!

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Facing Foreclosure? Bankruptcy Can Help

By | Bankruptcy Law, Foreclosure | No Comments

Are you an Auburn or Opelika resident facing foreclosure? Here’s how bankruptcy could save your home.

Foreclosure is the legal process that allows a lender, or creditor, to sell your property to satisfy the debt you owe. Of Alabama’s 2,288,330 homes, 391 went into foreclosure in April of 2022, revealing a foreclosure rate of one in every 5,853 homes.

Fortunately, if you’re an Alabama resident facing foreclosure, a lender won’t begin the foreclosure process until you’ve fallen far behind in mortgage payments. This gives you time to try some alternate measures before filing for bankruptcy, such as loan forbearance, a short sale, or a deed in lieu of foreclosure

When these measures fail, it makes sense to consider whether bankruptcy can help you avoid foreclosure, or at least buy you a little time. As a bankruptcy lawyer in Auburn, Alabama, David S. Clark and his team of professionals have years of experience helping Alabama residents navigate financial hardship and they can help you too.

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

Delaying Foreclosure With The Automatic Stay 

One of the biggest benefits of filing for bankruptcy is the court-mandated order that causes any creditors to cease their collection activities immediately. Known as “The Automatic Stay”, creditors can’t call, email, visit or do anything that attempts to collect payments from you. 

Ultimately, If your home has been scheduled for a foreclosure sale, and you file for bankruptcy, the automatic stay will legally postpone the sale while your bankruptcy is pending (this process typically lasts three to four months)

While this is true, a lender can appeal to the bankruptcy court for permission to proceed with the foreclosure by filing a “motion to lift the automatic stay.” If successful, a creditor can continue with the foreclosure sale as well as any collection activities. 

Please note that although the automatic stay can temporarily stop a foreclosure sale, you may still lose your home if the foreclosure sale is completed under state law before filing for bankruptcy. 

How Chapter 13 Bankruptcy Can Help

If you are an Auburn or Opelika resident that is facing foreclosure due to unpaid mortgage payments but want to remain in your home, then filing for Chapter 13 Bankruptcy could help. 

Also known as a wage earner’s plan, Chapter 13 bankruptcy enables Alabama residents with a regular income to develop a plan to repay all or part of their missed mortgage payments. The plan is typically between three to five years and requires timely payments or payroll deductions. 

While Chapter 13 Bankruptcy can stop foreclosure proceedings, you’ll need enough income to not only meet your current mortgage payment, but also any arrearage (late unpaid mortgage payments). 

David S. Clark: An Experienced Auburn & Opelika Bankruptcy Attorney

When it comes to understanding the relationship between bankruptcy and foreclosure, it’s a good idea to consult an experienced bankruptcy attorney. With over 25 years of combined experience, the attorneys at David S. Clark are here to help any Auburn or Opelika resident navigate through bankruptcy. 

If you are facing foreclosure and don’t know where to turn, Contact David S. Clark today!

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

What is Debt Collection Harassment?

By | Bankruptcy Law | No Comments

Whether it’s considered “good debt” or “bad debt,” the truth is that any type of debt can cause many emotional and physical effects to an Auburn or Opelika resident.

Studies show what many of us already know: debt is about much more than money. While the stress of debt can be immense on its own, creditors have the potential to bring even more stress when they resort to unethical tactics to try and force you to make payments. 

While creditors do possess a right to their collections activity, they are bound by the Fair Debt Collection Practices Act with how they may collect it. Unfortunately, this doesn’t always stop creditors, as debt collection harassment can even continue after you’ve filed for bankruptcy. 

Here’s what you need to know about debt collection harassment and how to fight it with the help of David S. Clark, an experienced Auburn and Opelika bankruptcy attorney.

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

What is Debt Collection Harassment?

Debt collection harassment, or creditor abuse, occurs when a collection agency that is owed money uses abusive collection practices to intimidate or force debtors to make a payment. Even without the money to pay off debt, a collection agency may act deceitfully in an attempt to collect anyway. 

Ultimately, debt collection harassment can come from any kind of debt including (but not limited to): student loans, credit card payments, mortgages, and auto loans; but with over 140 billion in unpaid medical bills across the United States, collection agencies are most often chasing payments related to medical bills. 

This is especially true in Lee County as the mean medical debt per person is at an incredibly high concentration between $994 and $3661.

Examples of Debt Collection Harassment

Despite what type of debt you may have, it is essential to know the signs of debt collection harassment and your rights as an Auburn or Opelika resident. Under the Fair Debt Collection Practices Act debt collectors may not: 

  • Use or threaten the use of violence to harm you, your reputation, or your property
  • Lie about who they are, the debt you owe, or what will happen if you fail to pay it
  • Call you repeatedly with the intent to annoy, abuse, or harass you
  • Use obscene or profane language with the intent to intimidate or scare you
  • Publish a list of consumers who allegedly refuse to pay debts (except to a consumer reporting agency) 

What if a Creditor Contacts Me During Bankruptcy?

According to Section 524 of the U.S. Bankruptcy Code, no one can take action against you if your debt has been discharged through bankruptcy. Known as the “automatic stay”, this action is immediately ordered and enforced by the bankruptcy court. 

Ultimately, the automatic stay makes it illegal for creditors to contact you about any discharged debt once you file for bankruptcy. This means creditors can’t call, email, visit, or do anything that attempts to collect debt from you. 

It is important to note that although creditors can no longer contact you regarding discharged debts, not all debts are discharged through bankruptcy.

Unfortunately, there are times when creditors still contact you, which violates the protections of the automatic stay. If a creditor willfully violates the automatic stay with an intent to collect, the court can sanction the creditor with the help of your bankruptcy attorney. 

How to fight Debt Collection Harassment 

If you are being harassed by unethical debt collection tactics, it is important to seek the help of a trusted Auburn and Opelika bankruptcy attorney to fight on your behalf. David S. Clark has years of experience and understands how overwhelming debt, bankruptcy, and creditors can be. 

If you are an Auburn or Opelika resident facing debt collection harassment, contact David S. Clark as soon as possible to discuss your situation in complete confidentiality. 

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Debt Consolidation vs. Bankruptcy – How to Settle Your Debt

By | Bankruptcy Law, Understanding Bankruptcy | No Comments

Learn to settle your debt with either Debt Consolidation or Bankruptcy. 

Alabama’s total state debt is nearly $9 billion. If an institution such as the State Government of Alabama is not always in the green financially, then it is no wonder that its residents often find themselves in positions of repaying debts.

While some debt isn’t bad—a mortgage can help you achieve the goal of owning a home and may help you ultimately build wealth, student loans can help you obtain a college degree, and a moderate amount of debt, if paid off in time, can help you build credit–the wrong kind of debt can lead to financial ruin.

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

There are several tools that debtors can use which can help someone recover from an extensive amount of debt. The number of these, though, can be overwhelming if you are not sure which option is best for you.

Two of the more common options are debt consolidation and bankruptcy. When choosing between debt consolidation and bankruptcy, it is important to know the benefits and to determine which option is best for you based on your unique financial situation.

Debt Consolidation 

Debt consolidation refers to the act of consolidating multiple lines of debt into a single, bundle debt payment. This payment usually has a lower interest rate, and, therefore, a lower monthly payment.

If you have multiple student loans, credit cards, or other liabilities with high monthly payments because debt consolidation can simplify things for you, it may be the best choice.

While the interest rate and monthly payment may be lower on a debt consolidation loan, it’s important to pay attention to the payment structure. Typically, with a smaller monthly payment that debt consolidation provides, debtors will pay on their loans for a longer period of time. This means that you will end up paying a higher amount than you originally would have paid.

If, however, this means that you are able to make your payments, then it will be a good option for you.

Bankruptcy

Many Alabama residents consider bankruptcy as a financial boogeyman to be avoided at all costs. Yet, if you have taken on an unimaginable amount of debt, bankruptcy exists to help you. 

Bankruptcy is a legal process where an individual who cannot repay debts to creditors may seek relief from part or all of their debt. This can be an extremely long process that requires granting judges and creditors extensive access to financial records, among other things. 

In deliberation with your bankruptcy attorney, the court will put together a plan for you to pay off as much as your debt as possible. They will also provide court-mandated guidance on how to avoid another incident involving bankruptcy in the future.

With the extensive paperwork, financial documentation, laws, and local procedures present in a bankruptcy filing, hiring an experienced bankruptcy attorney to represent you in bankruptcy is very important. 

David S. Clark and his team have been helping Auburn and Opelika, AL residents settle debt through debt consolidation and bankruptcy for years. Contact David S. Clark today.

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

The Benefits of Chapter 7 Bankruptcy for Opelika & Auburn Residents

By | Bankruptcy Law, Chapter 7 Bankruptcy | No Comments

Chapter 7 Bankruptcy is a particularly helpful option in bankruptcy code for Auburn and Opelika residents who have a current monthly income that falls below the state median monthly income.

Many Opelika & Auburn residents are very hesitant to look into declaring bankruptcy to find relief from their numerous debts that they are unable to repay because declaring bankruptcy is often looked down on by the public.

Bankruptcy, however, is a perfectly legitimate form of debt restructuring that has helped countless Americans escape financial ruin since its adoption into United States law.

Chapter 7 Bankruptcy is a particularly helpful option in bankruptcy code for Auburn and Opelika residents who have a current monthly income that falls below the state median monthly income.

Here are some of the benefits of Chapter 7 Bankruptcy in Opelika and Auburn, AL:

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

Chapter 7 Bankruptcy Helps Those With Little Financial Resources

Chapter 7 Bankruptcy is specifically designed to assist those on the lower end of the financial system gain relief from their debts.

This is accomplished by those who wish to file Chapter 7 Bankruptcy being subject to the means test mentioned earlier.

Chapter 7 Bankruptcy Doesn’t Make You Face Creditors Alone

In every Chapter 7 Bankruptcy case, the court assigns an impartial case trustee to help mediate between you and your debtors. These trustees are assigned as impartial case managers for the state.

They aren’t working to make money for the creditors and they also aren’t working to magically make your debts appear. They are seeking the best route forward for both parties.

Though this case trustee is a helpful and necessary player in Chapter 7 Bankruptcy cases, he or she is not a bankruptcy attorney.

Chapter 7 Bankruptcy attorneys have a fiduciary duty, a duty to put your interests above any others. So, even with the benefit of having impartial case trustees in Chapter 7 bankruptcies, an Opelika/Auburn bankruptcy attorney is an important asset to your team because he or she will advocate explicitly for you.

The Chapter 7 Discharge

A discharge in Chapter 7 bankruptcy cases is one of the greatest protections that is offered to debtors against creditors in the bankruptcy process.

When a person files for bankruptcy, he or she gives immense power to the courts, the court appointed trustee, and their creditors. This is a frightening step for many debtors, and rightfully so. With a Chapter 7 discharge, however, many fears that a debtor might have of losing all of his or her civil rights because of debts owed are laid to rest because it frees debtors from the personal liability for many of their debts and it prevents creditors from taking collection action against them.

Given the nature of Chapter 7 bankruptcy as a means by which debts can be paid, there are many exceptions present in a Chapter 7 discharge clause. This is one of the many areas that hiring a qualified Chapter 7 Bankruptcy attorney can be an asset to you.

A good Auburn/Opelika Chapter 7 Bankruptcy attorney knows the ins and outs of these discharges and can guide you through this process.

David S. Clark, Chapter 7 Bankruptcy Attorney

Because of the complexity of Chapter 7 Bankruptcy, its benefits are often out of reach for most Opelika or Auburn residents because they don’t hold a law degree.

This is why hiring a reputable Auburn/Opelika Chapter 7 Bankruptcy attorney like David S. Clark can be an important factor in successfully filing for Chapter 7 Bankruptcy.

If you are looking to file Chapter 7 Bankruptcy in Auburn or Opelika, AL contact us today for a free case consultation and get your life back on the path toward financial freedom!

For more information about Chapter 7 Bankruptcy visit the United States Courts’ “Chapter 7 – Bankruptcy Basics.”

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

How COVID-19 Is Affecting Bankruptcy Law in Alabama

By | Bankruptcy Law, COVID-19, Understanding Bankruptcy | No Comments

Seeking bankruptcy in Auburn or Opelika will look a bit different after the COVID-19 pandemic. Make sure your bankruptcy attorney knows about these changes and is prepared to help you understand them.

There seems to be no area of society that the COVID-19 virus has not affected. 

One of the most significant effects and hotly contested issues is the role that this pandemic has played in the economic downturn that our entire country has experienced.

One thing that is certain, though, is that COVID-19 has made many people in Alabama suffer financially.

As an avenue for financial relief during personal economic crises, Chapter 7 and Chapter 13 Bankruptcy have, unsurprisingly, had some rules changed

Residents of Auburn and Opelika who are seeking to file bankruptcy should be aware of these changes so that they can take advantage of their benefits to debtors seeking relief.

Under the CARES Act and the Consolidated Appropriations Act of 2021 here are some of those changes:

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

Chapter 13 Payment Extension

If debtors can prove to their local bankruptcy court that they have endured a financial hardship due to the COVID-19 pandemic, then they may qualify for an extension to the payment plan for seven years.

Waived Original Signature Requirement

Because the entire country has been in lockdown at some point during the pandemic, some bankruptcy courts have decided to waive the requirement that a bankruptcy attorney must get a “wet signature” from his or her client on the bankruptcy petition.

This is simply the original signature from the debtor on the petition to file bankruptcy.

Debtors and their bankruptcy attorneys can review the necessary documents virtually rather than meeting in person.

This allows for the bankruptcy process to move forward without the physical contact that was previously required.

Section 341 Meeting of Creditors

Regardless of whether or not a debtor files for Chapter 7 or Chapter 13 Bankruptcy, he or she will have to attend a “meeting of creditors.”

This is where the debtor faces all of his or her creditors alongside the court-assigned trustee and discusses every relevant detail of what is owed so that everyone can have a unified, realistic expectation of what needs to be paid back.

Stimulus Money Cannot Be Counted as Income

When filing for bankruptcy, debtors have to list their income to submit to the courts.

With the stimulus checks that were given to many Americans, some people’s income drastically increased. If a debtor had to claim this as income, this could misrepresent the true financial situation of him or her.

In order to prevent this misrepresentation, the debtor is able to leave any money received from a stimulus check related to the coronavirus pandemic out of consideration when adding up income.

This list is a good start in the search for information on how the coronavirus pandemic has affected bankruptcy, but it is by no means exhaustive.

If you are an Auburn or Opelika resident who is considering filing for bankruptcy, you should consult an Auburn/Opelika bankruptcy lawyer who can explain in depth how bankruptcy law has been affected by recent COVID-19 legislation.

David S. Clark is a bankruptcy attorney who has represented numerous residents of Auburn, Opelika, and Lee County. Contact David S. Clark today for a free evaluation on your bankruptcy case!

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Why Choose a Local Bankruptcy Attorney

By | Attorneys & Lawyers, Bankruptcy Law | No Comments

One way to lower the risk of hiring an attorney who will work for him or herself rather than to help you overcome your financial hardship is to hire a local bankruptcy attorney like David S. Clark.

During financial crisis threats of repossession and collection calls from creditors often seem to come daily. Foreclosure of your home because of the inability to pay back your loan and falling prey to the payday loan cycle can feel like rock bottom for many.

The scary decision to file for bankruptcy or restructure your debt through debt consolidation may be the best way forward for those who find themselves in such economic turmoil.

Hiring an attorney to help you navigate these muddy waters can be a lifesaver, but hiring the wrong attorney can be more harmful than helpful.

One way to lower the risk of hiring an attorney who will work for him or herself rather than to help you overcome your financial hardship is to hire a local bankruptcy attorney like David S. Clark. Here are a few reasons why:

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

It’s Easier to Know Local Bankruptcy Attorneys

Lawyers that have central offices across the nation or throughout the state are often located in distant urban centers.

This can make it difficult for them to empathize fully with their clients.

A local attorney, however, is focused on a much more focused area. They live in the same area that you do. Their children go to school with yours. You go to church with them. You see them at the park or at a restaurant downtown.

They are accessible and approachable.

This adds a level of transparency to an attorney because the people that he or she would represent are able to know him or her on a far deeper level than just how many millions of dollars have been won in settlements or how many successful bankruptcy declarations he or she has had.

Local Bankruptcy Attorneys Are Invested in Their Communities

This investment is both financial and social.

When you pay your local lawyer for the services they provide, that money is going to be used to pay bills including groceries for their family, a house payment on a loan from the local bank, tuition for their kids at the local community college or university, and charitable giving to local non-profit organizations.

This is an investment in the improvement of your community.

If you were to hire a lawyer who is part of a law firm that is centrally located in a distant city, then the money that you pay for legal representation may go to several different places. The community that you live in, however, will not likely be where this money ends up.

Local Bankruptcy Attorneys Know the Local Courts and Financial Services

The journey to financial freedom through bankruptcy is one that involves several meetings with financial counselors, standing before judges, and negotiating with creditors. 

Much of this involvement with bankruptcy happens at the local level.

A local bankruptcy attorney will be able to help you navigate these institutions better than almost anyone because they interact regularly with the same individuals in these organizations.

This interaction builds a natural bond of trust between your local lawyer and these institutions. As one who is represented by a local lawyer, that trust may then extend to you and give you more favorable conditions from which to work for financial freedom.

If you are a resident of Auburn, Opelika, or East Alabama and are looking to file Chapter 7 or Chapter 13 Bankruptcy, contact David S. Clark, a local bankruptcy attorney, today!

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

What Is Chapter 7 Bankruptcy?

By | Bankruptcy Law, Understanding Bankruptcy | No Comments

If you feel lost when researching Chapter 7 Bankruptcy, this quick guide is for you.

Chapter 7 Bankruptcy is defined by bankruptcy that relieves a debtor from his or her debts through the liquidation (the exchange of valuable assets like a home, car, television, etc. for cash) of assets and subsequent distribution of these assets to creditors.

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

Who Can File Chapter 7 Bankruptcy?

Individuals, partnerships, corporations, or other business entities can qualify for Chapter 7 Bankruptcy. However, not every individual, partnership, and corporation can file for bankruptcy.

In this post, we will focus only on individuals and how Chapter 7 Bankruptcy can affect them. 

There are a few requirements and restrictions on what an individual must do in order to qualify for Chapter 7 Bankruptcy:

  • First, someone seeking relief through Chapter VII Bankruptcy must be subject to a means test.
  • Secondly, a debtor must appear before the court and comply with court orders at least 180 days before the debtor wishes to file. Failure to do so will result in the case being dismissed without relief to the debtor.
  • A person who wishes to seek relief under Chapter 7 Bankruptcy must also receive professional credit counseling from a credit counselor that is approved by the court. This must happen at least 180 days before the debtor files. Failure to do this will result in the debtor’s case being thrown out and he or she will receive no relief.

How To File Chapter 7 Bankruptcy

An individual begins the process of filing Chapter 7 Bankruptcy by submitting a petition to the local bankruptcy court (click here to view an official bankruptcy court map). In addition to this, the person seeking relief must fill out several forms disclosing the entirety of their financial situation and history. These form include:

  • Schedules of assets and liabilities.
  • Schedule of current income and expenditures.
  • Statement of financial affairs.
  • Schedule of executory contracts and unexpired leases.

The debtor will then have to pay several court and service fees for filing. This is mandatory for everyone seeking debt relief under Chapter 7 Bankruptcy unless the individual’s income is less than 150% below the poverty level as defined by Bankruptcy Code.

If the debtor is married, he or she will have to fill out this information for his or her spouse regardless of whether or not they are filing jointly.

21 – 40 days from the date of petition, the case trustee (an impartial individual who is assigned by the state or federal government to administer the case and liquidate the debtor’s nonexempt assets) will meet with the creditors of the debtor. Here the trustee will subject the debtor to an oath and then the creditors will be able to ask any questions regarding the individual’s financial matters and property.

Helpful Chapter 7 Tips

It is very important that the debtor cooperates fully throughout the bankruptcy process with the bankruptcy court and the trustee assigned to the debtor’s case. This is especially true when the trustee calls the meeting of creditors.

Though the questions that will be asked will be difficult, complicated, and can sometimes be embarrassing, the debtor must submit fully to his or her oath of honesty. This will be to the ultimate benefit of the debtor and will hopefully end in his or her financial relief.

Additionally, If the debtor then recognizes that a different chapter of bankruptcy is more applicable and beneficial to the situation, he or she may be able to convert the case to the appropriate chapter so long as it has not already been converted from another chapter.

Filing for Chapter 7 Bankruptcy can be a scary process added on top of an already tumultuous time. Hiring a bankruptcy lawyer who is competent and compassionate can help relieve your stress during the filing process and can help you get the financial relief that you need. Contact David S. Clark today and get started on the road toward financial freedom!

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

What Is Chapter 13 Bankruptcy?

By | Attorneys & Lawyers, Bankruptcy Law, Understanding Bankruptcy | No Comments

In our last blog post we learned that Chapter 13 bankruptcy is known as ““Adjustment of Debts of an Individual With Regular Income.” Let’s explore a bit more what exactly that means and how it can help you regain control of your financial situation.

A Brief History of Chapter 13 Bankruptcy

In a previous article entitled, “How Bankruptcy Law Has Changed” we gave a more in depth recounting of the bankruptcy story.

Some of the facets of Chapter XIII Bankruptcy go back in the American experiment to the drafting of the Constitution (One could make a strong argument that American bankruptcy originated in English Common Law in the 16th Century).

Chapter 13 Bankruptcy, however, became a specific category of debt relief with the passage of The Chandler Act of 1938.

Since then, it has been one of the most common avenues for Americans to obtain debt relief.

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

How Does Chapter 13 Bankruptcy Work?

After deciding to file Chapter XIII, a debtor must file a petition with the bankruptcy court of the area in which he or she has a domicile (legal address) or residence.

After filing the initial petition a debtor must also file schedules of: liabilities and assets, current income and expenditures, executory contracts and unexpired leases, and a statement of financial affairs.

Debtors then have to provide the court with proof that they have received financial counseling from a court certified counselor along with a few other miscellaneous documents listed here.

Then, the debtor must give the Chapter 13 case trustee with his or her tax returns or transcripts, this must also include returns filed during the case.

The debtor will then have to pay a charge of $235 for a case filing fee and a $75 miscellaneous administrative fee. This, fortunately, can be paid through installments.

Next, the debtor must compile:

  1. A list of all creditors and the amounts and nature of their claims;
  2. The source, amount, and frequency of the debtor’s income;
  3. A list of all of the debtor’s property; and
  4. A detailed list of the debtor’s monthly living expenses, i.e., food, clothing, shelter, utilities, taxes, transportation, medicine, etc. (Source: Chapter 13 – Bankruptcy Basics)

Then, the trustee will call a meeting with the debtor and all creditors. The debtor will be placed under oath, then be subjected to a series of questions from the trustee and creditors. During this meeting the actual disbursement plan is completed.

Following the trustee and creditor meeting, the court will hold the bankruptcy hearing.

After a confirmation of the plan by the bankruptcy court judge, the Chapter 13 plan will be implemented and it is up to the debtor to see that it is carried out to full success.

*Note that married couples can file jointly or separately.

Who Can File for Chapter 13 Bankruptcy?

Chapter XIII is fairly inclusive as to who can apply for it.

Here are the basic qualifications:

  • Debtor must have proof of regular income.
  • Unsecured debts can be no greater than $394,725.
  • Secured debts can be no greater than $1,184,200.

Benefits of Chapter 13 Bankruptcy

  • Because of the development of a legally binding debt payment plan with Chapter 13 bankruptcy, debtors are allowed to keep certain assets out of reach from creditors.
  • It allows a debtor to pay past-due payments like taxes, child-support, and alimony while protecting co-signers and allowing you to reduce debts like student-loan debt.

If you are considering filing for Chapter 13 bankruptcy, contact David S. Clark today!

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Questions To Ask Your Bankruptcy Lawyer

By | Attorneys & Lawyers, Bankruptcy Law, Understanding Bankruptcy | No Comments

Filing for bankruptcy is usually a journey into the unknown for many. So when beginning, you should have a few questions ready to ask your lawyer so that you can get started in the right direction.

What Type of Bankruptcy Should I File?

Not all bankruptcy is created equal. 

There are so many different forms of bankruptcy. Figuring out which specific type, or chapter, you should file for can be a daunting task.

You should ask your attorney which type of bankruptcy is right for your situation. The offices of David S. Clark deal with Chapter 7 and Chapter 13 bankruptcy cases.

DISCLAIMER: The following blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.

Need Bankruptcy Help? Call David S. Clark

What’s the Difference Between Chapter 7 and Chapter 13 Bankruptcy?

Chapter 7 Bankruptcy is also known as “Entitled Liquidation.” 

This means that a court supervised trustee takes over the assets of a debtor’s estate, turns them into cash (liquidates them), then distributes funds to creditors. In Chapter 7 the debtor has rights to make certain assets exempt.

Since the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 those seeking Chapter 7 Bankruptcy must undergo a “means test” to determine whether or not they qualify. There are income thresholds that, if a debtor exceeds, will disqualify the debtor from being able to declare Chapter 7 Bankruptcy.

Chapter 13 Bankruptcy is also known as “Adjustment of Debts of an Individual With Regular Income”

This is usually a more desirable avenue for debt relief than Chapter 7 because it enables a customer to keep certain valuable assets out of a creditor’s reach. The debtor then proposes a plan to repay creditors over a reasonable period of time.

Does Your Attorney Have a History of Success for His or Her Clients?

There are countless bankruptcies lawyers offering their services, but that does not necessarily mean that they have proven experience actually helping to get clients back on their feet.

Ask your lawyer about their case history. They should be able to provide you with a list of past clients that can reference how your lawyer worked with them.

Should I Even File for Bankruptcy?

While bankruptcy can be a helpful tool to help you get out of crippling debt, it may not be the right thing to do in your situation. 

There are several other ways to climb out of the hole of debt and your attorney should be able to give you adequate information about those.

Some of these other options include:

  • Debt Consolidation
    • This involves “rolling” all of your existing debts into one lump sum and is  helpful if you are able to refinance it at a lower interest rate and keep the rate low.
  • Foreclosure
    • This is selling an asset in order to pay back a creditor.
  • Wage Garnishments
    • This is where a person’s earnings are withheld by an order of the court to go directly to repaying debts.

The answers to these questions are not always clear. 

They are sometimes difficult to navigate. 

So having an attorney that will know in which direction to point you is crucial during a time of financial difficulty. What’s more is the importance of having an attorney who will take the time to listen to you and your situation, then inform you on what the best path forward for you is.

DISCLAIMER: The above blog post is just advice, and you will be better served to call David S. Clark with your bankruptcy questions. This blog contains helpful tips and advice, but is not professional legal advice, and shouldn’t treated as such.