Chapter 7 Bankruptcy
In order to file for Chapter 7 bankruptcy, you must first meet certain income requirements. In general, your income cannot exceed the median income for a similar household in the state of Connecticut. If you qualify, Chapter 7 bankruptcy allows you to discharge unsecured debt like credit cards, certain kinds of loans, and medical bills. Income taxes more than 3 years old can also be discharged.
Additionally, once you file for bankruptcy, creditors and debt collections agencies must cease all contact with you. At the law office of Harlow, Adams & Friedman, we can determine if you are eligible for Chapter 7 bankruptcy, and prepare all documentation and forms necessary for filing. Depending on your financial situation, we may be able to help you avoid foreclosure on your home by recommending refinancing or loan modification strategies you can pursue with your mortgage lender.
We can help you stop the harassing phone calls and angry letters from creditors - contact the bankruptcy lawyers at Harlow, Adams & Friedman today to schedule an appointment and discuss your case.
How does Chapter 7 Bankruptcy Work?
If you meet the income requirements for Chapter 7 bankruptcy, you must list all of your debts and all of your assets. Once you contact our office, we will review your financial situation and prepare all necessary paperwork. After you file, debt on unpaid credit cards, various kinds of loans, medical bills, and other unsecured debt may be discharged. Income taxes more than 3 years old may also be discharged. However, once you file for bankruptcy, an automatic stay is placed on creditor contracts and foreclosures. As a result, foreclosure on your home can be delayed - though ultimately, it may not be averted. People with very valuable assets may have to choose a different option.
In the state of Connecticut, there are a number of exemptions that can greatly assist those who file for bankruptcy. For instance, there is a homestead exemption that may allow you to keep your home if you are able to continue making monthly mortgage payments. There is also an exemption for "tools of the trade" which allows you protect any equipment or property necessary for your business or form of work. Additionally, qualified retirement funds, IRAs, 401ks, and pensions are exempt. We will select the ones that best protect your assets.
What Will Happen to My Home and My Cars?
In Chapter 7 you must be able to pay your mortgage and car payments to keep those assets. However, the vast majority of banks prefer a loan modification or refinancing arrangement to foreclosure. The fact is, in this economy banks often stand to lose more on a home through foreclosure than on modifying a loan. You will need to talk to your bank in order to determine if they are willing to work with you.
Will I Ever qualify for a Loan Again?
Banks depend on consumers. Even if you've filed for bankruptcy, they still want you borrowing money and using credit. Initially, in the months following filing for bankruptcy, you may only qualify for a low balance credit card of $500 or so. If you pay off your balance and remain current on payments, your credit line will be steadily increased. Eventually, your credit score will improve and you'll qualify for loans and bigger lines of credit.
Questions? Contact the Bankruptcy Attorneys at Harlow, Adams & Friedman
Declaring bankruptcy is often the most effective means of regaining your financial footing. Even though debt consolidation companies claim to save your money, going through them may be more expensive in the long run. To discuss your options and learn how we can help you, contact Chapter 7 bankruptcy attorneys at Harlow, Adams & Friedman today.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.