Avoiding Concerns about the Fraudulent Use of Credit before a Bankruptcy Filing Unmanageable credit card debt commonly contributes to a decision to seek protection under the bankruptcy laws. Because credit card debt is an unsecured obligation, you can permanently discharge credit card bills under Chapter 7. You must be careful, though, that you don't engage in activity prior to your bankruptcy … [Read more...]
Can You File for Bankruptcy More than Once?
The U.S. bankruptcy laws were enacted to help people get a fresh financial start, granting debtors some relief from the incessant phone calls, letters and legal action that typically accompany efforts to collect a debt. As a part of the bankruptcy process, debtors are required to undergo financial counseling, a process that often prevents further financial difficulties. But what if the unexpected … [Read more...]
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The Benefit of Filing Bankruptcy Quickly if Your Income Has Increased or Is About To
To qualify for Chapter 7 "straight bankruptcy" you must pass the means test. Otherwise you would likely end up in the much more time-consuming and expensive Chapter 13 "adjustment of debts." Chapter 13 is great if you need its benefits, but not if you are forced into it and would prefer the much simpler fresh financial start of Chapter 7. Taking Advantage of the Odd Means Test Definition of … [Read more...]
Dealing with a Recent One-Time Income Event for the “Means Test”
The Chapter 7 Means Test This test was designed to screen people away from Chapter 7 "straight bankruptcy" and towards Chapter 13 "adjustment of debts." Those who could afford to pay a meaningful amount to their creditors are legally required through the means test do so under Chapter 13 instead of being allowed to discharge (legally write off) their debts under The means test looks at your … [Read more...]
You May Not Need to Take the “Means Test” if You Are a Business Debtor
The means test is the gateway for qualifying to get a fresh financial start through a Chapter 7 "straight bankruptcy" case. This test is based first on your income. If your income—based on a very distinct way of calculating it—is not low enough, then the means test also looks at your allowed expenses, based on a complicated set of rules looking at national, regional, and local expense standards. … [Read more...]
Why Every Day Can Make a Difference in Passing the “Means Test”
The Point of the Means Test This test is intended to determine if you have the "means" to pay a meaningful amount to your creditors over a reasonable time period. You have to pass the means test before you are allowed to go through a Chapter 7 "straight bankruptcy," which generally lasts less than four months, or instead are forced to do a Chapter 13 "adjustment of debts," which generally … [Read more...]
What Happens to Retirement Benefits in Bankruptcy
Protecting Your Retirement in Bankruptcy Most forms of retirement are protected when you file under any Chapter of bankruptcy. There are a few exceptions to this, so make sure that whatever kind of retirement you have is protected from your creditors. If in fact all of your retirement funds are protected, that means that if you file a Chapter 7 "straight bankruptcy" case the Chapter 7 trustee … [Read more...]
Dealing with an Expected Vehicle Repossession
Bankruptcy stops your vehicle from being repossessed, and then gives you many tools—under both Chapter 7 and Chapter 13--to either keep or surrender the vehicle. Stopping the Repossession The minute you file any kind of bankruptcy case, the “automatic stay” instantaneously stops vehicle repossession. The automatic stay is an injunction against repossession and any other collection efforts by … [Read more...]
Dealing with an Unhappy Ex-Spouse Creditor
A Chapter 13 bankruptcy - the 3-to-5-year legal procedure for “adjustment of debts”—can help you in two huge ways with an ex-spouse who is unhappy with you for not paying a debt you owe to him or her: It can discharge (legally write-off forever) non-support “property settlement” obligations owed to your ex-spouse through your divorce decree. It can give you time to catch up on child support, … [Read more...]
