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.
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.
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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.