Most people, who file bankruptcy, file under Chap 7. It is the quickest and least expensive of all the types of bankruptcy cases and is generally completed in 4-5 months after your case is filed.
In order to file, you must first take a credit counseling course online and obtain your certificate of completion.
The next important step is to qualify under the income test, known as the “means test”. This is designed to keep high-income earners out of chap. 7 and to make them file under chap. 13. In general, your income cannot exceed a certain threshold for a similar household in the state of Connecticut. However, people with more business debt than consumer debt are exempt from this test. There are other loopholes and exceptions also. We will work closely with you to get the best possible result for you on this test.
If you qualify, Chapter 7 bankruptcy allows you to discharge most of your debt like credit cards, bank loans, and medical bills. Income taxes more than 3 years old can also be discharged. All of your tax returns must be filed in order to file an individual bankruptcy case.
Filing a bankruptcy case automatically stays, or freezes, all creditor action. Therefore creditors and debt collections agencies must cease all contact with you including harassing phone calls, letters, and lawsuits. Creditors must also stop all collection efforts even if they have already obtained a judgment against you.
At the law office of Harlow, Adams & Friedman, we can get the necessary information from you to determine if you are eligible for Chapter 7 bankruptcy, prepare the means test, and prepare all documentation and forms necessary for a successful Chap 7 case. The goal of every chap. 7 is to obtain a discharge of your debts. This law permanently prevents all creditors that you listed on your bankruptcy paperwork from ever attempting to collect those debts again. So it is very important to make sure to include every creditor to whom you owe money. Although the discharge law is very broad, there are some exceptions to getting a discharge of every debt.
For example, alimony and child support, most taxes, criminal fines, unlisted debts, and debts incurred through fraud may not be discharged. We can review these exceptions with you in more detail.
Bankruptcy also requires you to include in your paperwork all of your assets. The exemption laws allow you to keep several types of assets or to protect amounts of equity in your assets. For example, in Conn. the Homestead exemption protects up to $75,000 of equity in your residence which is doubled for married spouses who both own the home. This is a valuable method of keeping your home through a bankruptcy case, which may people re able to do. The “tolls of the trade” exemption are unlimited in Conn. and has been successfully used to protect many types of equipment you may use to earn a living. It is broad in scope. Retirement funds are also exempt generally.
We may also be able to help you avoid foreclosure by recommending refinancing options 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 lawyers at Harlow, Adams & Friedman today to schedule an appointment and discuss your case.
Chapter 7 Bankruptcy – Gain a Discharge of Your Debts
In Chapter 7 bankruptcy, you must list all of your debts and all of your assets. We will work with you to accumulate all of the required documents for your bankruptcy case. After you file, debt on unpaid credit cards, personal loans, medical bills, and other debts will be discharged. Income taxes more than 3 years old may also be discharged. After your file Chapter 7, all creditor action must cease. As a result, foreclosures and other lawsuits must stop, although Bank’s may be allowed to continue foreclosing if you do not pay your mortgage back. People with very valuable assets may have to choose a different option such as Chapter 13 or 11.
Your Home and Cars Can be Protected
In Chapter 7 you have to continue paying your mortgage and car payments to keep your house and car. However, the t majority of banks prefer a loan modification or refinancing arrangement to foreclosure. Chapter 7 bankruptcy eliminates any amount debt you may owe which is greater than the value of your house or car; this is known as the deficiency. Therefore, most banks will negotiate since they often stand to lose more on a home through foreclosure than on modifying a loan. You will need to negotiate with your bank in order to determine if they are willing to work with you.
You Can Qualify for a Loan Again
Bankruptcy should be viewed as a method of clearing up your credit report if you cannot do that some other effective way. If you pay all of your bills every 30 days after bankruptcy and have steady employment and income you will qualify for credit again in a few years’ time. Banks depend on consumers. Even if you’ve filed for bankruptcy, they still want you borrowing money and using credit. Bankruptcy is reported on your credit report for up to 10 years but you will not have any other adverse credit reporting. Eventually, your credit score will improve and you’ll qualify for loans and lines of credit.
Questions? Contact the Bankruptcy Attorneys at Harlow, Adams & Friedman
Declaring bankruptcy is often the most effective means of reestablishing your credit Generally speaking, although debt consolidation companies claim to save your money, using them is usually more expensive in the long run. Call Attorney Jim Nugent to discuss your options and learn how we can help you with a Chapter 7 bankruptcy at Harlow, Adams & Friedman today.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.