Bankruptcy Blog

Filing bankruptcy in Indianapolis is something most people do not want to think about or talk about. It is something that a lot of people see as complete failure and disaster.

Even though it is something that you probably do not want to think about or consider, you may have reached a point where it is impossible to pay your debtors. If this is true, it is an option that you may need to look into.

It may help to have a clear understanding of what bankruptcy is. Bankruptcy is defined as, “a legally declared inability or impairment of ability of an individual or organization to pay its creditors.” It is legal insolvency. Bankruptcy is a legal surrender of your remaining assets into the hands of your creditors.

In the United States, bankruptcy is placed under Federal jurisdiction by the United States Constitution (in Article 1, Section 8, Clause 4), which allows Congress to enact “uniform laws on the subject of bankruptcies throughout the United States.” The Congress has enacted statute law governing bankruptcy, primarily in the form of the Bankruptcy Code, located at Title 11 of the United States Code. Federal law is amplified by state law in some places where Federal law fails to speak or expressly defers to state law.

Bankruptcy cases are always filed in United States Bankruptcy Court, which is an adjunct to the U.S. District Courts. However, bankruptcy cases, particularly with respect to the validity of exemptions and claims, are often dependent upon law. Because of this, it is usually not possible to generalize bankruptcy law across state lines.

For this reason, it is important for you to know the laws regarding bankruptcy of the state that you live in. If you plan on filing bankruptcy in Indianapolis, you need to know the laws as they relate to you in filing an Indiana bankruptcy. You will probably need the help of an Indianapolis bankruptcy lawyer who can help you understand how Indiana bankruptcy laws will affect your case.

The most common type of personal bankruptcy that is filed in Indianapolis is Chapter 7.. Your non-exempt property is given to a bankruptcy trustee when you file Chapter 7. The trustee then liquidates your non-exempt property and distributes the proceeds to your unsecured creditors. You are entitled to a discharge of some of your debt in exchange for this.

The other personal bankruptcy that you can file in Indianapolis is Chapter 13. You get to keep ownership and possession of all your assets with Chapter 13. You have to give a portion of your future income to repay your creditors in return for this. This is normally done over a three to five year period.

The first thing you have to do if you are thinking about filing bankruptcy in Indianapolis is to decide whether to file Chapter 7 or Chapter 13. You probably need to consult with an Indianapolis bankruptcy lawyer about this important decision.

Chapter 7 seems to be the obvious choice to most people because they think it will “wipe out” all of their debts and give them a fresh start. It is probably the best choice if you are under a heavy load of debt and cannot pay it back. On the other hand, some of your debt might not be dischargeable. Chapter 13 may be a better choice if this is true.

Chapter 13 is also a better choice if you have property that you do not want to lose. If you are behind on mortgage or business payments, Chapter 13 may be a better option. Chapter 13 gives you the opportunity to reinstate your original mortgage agreement and make up overdue payments over a period of time.

Another reason for filing Chapter 13 is if you do not qualify to file Chapter 7. It becomes your only choice. Your income will determine whether you are eligible to file Chapter 7. You are eligible to file Chapter 7 if your income is below the median of a family your size in Indiana, you can file Chapter 7. You have to pass the “Means Test” if your income is above the median for Indiana.

This test checks your disposable income. If it says that you have enough to pay back at least some of your unsecured debts over a five-year repayment period, Chapter 13 is your only option.

If you are eligible to file Chapter 7, you can only take state exemptions in Indiana. Federal exemptions are not allowed.

Your Indianapolis bankruptcy lawyer knows the exemptions. He or she also knows the amounts and limits on the Indiana state exemptions.

The reason you need an Indianapolis bankruptcy lawyer is because bankruptcy is a highly specialized area of law. This is the area of law that Indianapolis bankruptcy lawyers specialize in. They work with bankruptcy cases every day. They also have to keep up with the changes and updates that happen in Indiana bankruptcy law.

This decision may affect you and your family for the rest of their life. You deserve the best advice possible from an Indianapolis bankruptcy lawyer near you.

Filing bankruptcy in New Jersey is something most people do not want to think about or talk about. It is something that a lot of people see as complete failure and disaster.

Even though it is something that you probably do not want to think about or consider, you may have reached a point where it is impossible to pay your debtors. If this is true, it is an option that you may need to look into.

It may help to have a clear understanding of what bankruptcy is. Bankruptcy is defined as, “a legally declared inability or impairment of ability of an individual or organization to pay its creditors.” It is legal insolvency. Bankruptcy is a legal surrender of your remaining assets into the hands of your creditors.

In the United States, bankruptcy is placed under Federal jurisdiction by the United States Constitution (in Article 1, Section 8, Clause 4), which allows Congress to enact “uniform laws on the subject of bankruptcies throughout the United States.” The Congress has enacted statute law governing bankruptcy, primarily in the form of the Bankruptcy Code, located at Title 11 of the United States Code. Federal law is amplified by state law in some places where Federal law fails to speak or expressly defers to state law.

Bankruptcy cases are always filed in United States Bankruptcy Court, which is an adjunct to the U.S. District Courts. However, bankruptcy cases, particularly with respect to the validity of exemptions and claims, are often dependent upon law. Because of this, it is usually not possible to generalize bankruptcy law across state lines.

For this reason, it is important for you to know the laws regarding bankruptcy of the state that you live in. If you plan on filing bankruptcy in New Jersey, you need to know the laws as they relate to you in filing a New Jersey bankruptcy. You will probably need the help of a New Jersey bankruptcy attorney who can help you understand how New Jersey bankruptcy laws will affect your case.

Most of the time, Chapter 7 is the type of personal bankruptcy that is filed in New Jersey. In this form of bankruptcy, your property that is not exempt is given over to a bankruptcy trustee who then liquidates (sells) your property and gives the money to your unsecured creditors. You receive a discharge of some of your debt in exchange for this.

Another kind of personal bankruptcy that is often filed in New Jersey is Chapter 13. With this form of bankruptcy you get to hold on to ownership and possession of all of your assets. In return, some of your future income is allocated to pay back your creditors over a three to five year period.

Chapter 7 is “liquidation” or “straight” bankruptcy. It is what most people think of when they are planning on filing bankruptcy. One of the good things about Chapter 7 is that you can have all of your unsecured debts forgiven (discharged). This includes things like credit cards and medical bills.

Another reason so many people want to file Chapter 7 is that even secured debts you’re your home and auto may be exempt from liquidation. Many people lose nothing when they file Chapter 7 because they do not have any property that is not exempt.

Chapter 13 is “reorganization” or “rehabilitation” bankruptcy. It differs considerably from Chapter 7. The aim of Chapter 13 is for you to pay back at least a portion of your secured debts over a period lasting three to five years. A repayment plan that is called a Chapter 13 plan is formulated to carry this out. This plan is then done under the supervision of the Court.

Chapter 7 is what most people want to do, but Chapter 13 could be your best choice. If you want to keep property that is not exempt, you are probably better off filing Chapter 13. Or, if you do not qualify to file Chapter 7, Chapter 13 is your only bankruptcy option.

Your income will determine your eligibility to file Chapter 7. If your income is below the median for a family your size in New Jersey, most of the time you can file Chapter 7. If your income is above the median for New Jersey, it is submitted to the “Means Test”.

The “Means Test” uses a formula that takes into account your income and certain expenses to determine how much “disposable” income you have. If the test determines that you have enough disposable income to pay back some of your unsecured debts, you cannot file Chapter 7 in New Jersey.

If you can file Chapter 7 in New Jersey, you have a choice to make. You have to choose between using federal or state exemptions. You cannot use both.

A New Jersey bankruptcy attorney can help you determine your eligibility for filing Chapter 7, and if so, which set of exemptions is best for you. If you are qualified to file Chapter 7 or Chapter 13, your New Jersey bankruptcy lawyer can help you choose the one that is right for you.

Chapter 13 Bankruptcy may be a good option for individuals who do not pass the means test or who have property and assets they would like to keep. Unlike Chapter 7 Bankruptcy, Chapter 13 Bankruptcy will not automatically discharge your debt, but will force you to repay some or all of your debt through a 3 to 5 year repayment plan.

An Iowa Bankruptcy Lawyer will file your bankruptcy petition and all proper Chapter 13 bankruptcy forms and will work with you to develop your bankruptcy repayment plan. At the end of your 3 to 5 year debt repayment plan, all qualifying debt will be discharge.

Certain assets will be exempt from the Chapter 7 Bankruptcy or Chapter 13 Bankruptcy process. Exempt assets are outlined at the federal level through the federal bankruptcy exemption list. Many states, however, have constructed their own list of bankruptcy exemptions and may allow you to choose between the federal or state list. Certain states will require you to use the state exemption list. In the state of Iowa, you are not allowed to choose the federal exemptions and you must use the State of Iowa Bankruptcy Exemptions.

Non-dischargeable assets are outlined under federal bankruptcy law. Non-dischargeable debts are debts which will not be discharged by filing either Chapter 7 or Chapter 13 Bankruptcy. Iowa will have the same non-dischargeable debts as all other states. If you do not continue debt payments for non-dischargeable debt, creditors have the legal right to continue debt collection efforts. In the state of Iowa, the following debts are not dischargeable:

• Federal, state and local taxes. May be subject to specific time rules.
• Spousal Support/Alimony
• Child Support Payments
• Most Student Loans
• Mortgage Liens
• Certain types of purchases for luxury items within 90 days of filing
• Secure Debt
• Penalties and fines by government agencies
• Fraud committed in a fiduciary role including larceny and embezzlement
• Punitive damages assessed for “willful and malicious acts”
• Debts not outlined on the schedule and forms filed with the Bankruptcy Court
• Drunk Driving fines
• Certain cash advances or purchases for luxury items with in a certain time frame.

Chapter 7 Bankruptcy is the least expensive, the quickest and the most common type of bankruptcy. The first step in Chapter 7 Bankruptcy is to meet with a bankruptcy attorney who will review your financial situation.

If you decide Chapter 7 Bankruptcy is your best option, an Iowa Bankruptcy Attorney will file your bankruptcy petition and a Statement of Your Financial Affairs in the appropriate Iowa Bankruptcy Court. These forms will identify your creditors, the amount and type of debt you owe, your income and expenses and your property you own.

Fortunately, filing the bankruptcy petition will provide you at least a temporary “automatic stay” which will delay debt collection efforts. Chapter 7 Bankruptcy may not halt collection efforts all together. Efforts may continue if a Bankruptcy Judge decides there is “cause”.

A trustee will be assigned to your bankruptcy case and will sell your assets and use the money from the sale to pay your creditors. Priority creditors will be paid first according to federal bankruptcy law. At the completion of the Chapter 7 Bankruptcy process, which is usually four to six months, your qualifying debt will be discharged. Dischargeable debt can include hospital expenses, unsecured personal loans and credit card debt. Corporations, married couples, individuals and partnerships all may qualify to file Chapter 7 Bankruptcy.

In 2005 under the Bankruptcy Abuse Prevention and Consumer Act (BAPCA), it became more difficult for most individuals to qualify for Chapter 7 Bankruptcy. Under the BAPCA, you must pass an income test. The income test will determine if your median income is below other residents in the state of Iowa. If it is below, you probably will be able to file Chapter 7 Bankruptcy, if it is above, additional “means testing” will need to be done.

Means testing will subtract certain expenses from your income such as your house payment, car payment, certain amount of school tuition and taxes owed. If your remaining income allows you to pay $6,000 or $100 per month toward debt in the next 60 months, you may not qualify for Chapter 7 Bankruptcy. If you fail this test, but you can still pay up to 25% in debt repayment, you may not qualify for Chapter 7 Bankruptcy.

The goal of the new legislation is to require more individuals to have to repay their debt. The BAPCA also requires credit counseling prior to filing bankruptcy and completion of a financial management course prior to the dismissal of your debt.

To determine your median income, you can compare your income to other residents in the state of Iowa. The United States Trustee program publishes a list of the state median incomes in the State Median Income Chart. In the state of Iowa, after March 15, 2009, for a single wage earner the median income is $41,381.  For a family of two it was $54,628 and for a family of three it was $63,888. For a family of four it was $74,047.

To determine if you can file Chapter 7 Bankruptcy, it is important to contact an Iowa State Bankruptcy Attorney who can complete the means test for you.

If you live in the state of Iowa and are facing high credit card debt, the inability to pay your bills or home foreclosure, you may be looking for help. The economy has deteriorated nationwide in the last few years, unemployment is high, houses have depreciated in value and medical expenses have risen.

If you are facing financial crises, filing bankruptcy may be an option for you. Over one million individuals nationwide filed bankruptcy in 2008. It is a tough financial decision but may be the last hope for you if you are facing:

• Home foreclosure
• High credit card balances and interest payments
• Repossession of you personal property
• Wage garnishments

Filing Chapter 7 Bankruptcy may discharge a large percentage of your unsecured debt such as medical bills, unsecured personal loans and credit card debt. If you do not qualify to file Chapter 7 Bankruptcy, you may be able to file Chapter 13 Bankruptcy and develop a more favorable debt repayment schedule.

If you are considering filing bankruptcy, it is best to contact an Iowa Bankruptcy Attorney who can review your financial situation and determine the next course of action for your family. An Iowa Bankruptcy Lawyer is knowledgeable about federal and state bankruptcy laws and can help you determine if you will qualify for Chapter 7 Bankruptcy or Chapter 13 Bankruptcy.

Filing Chapter 7 Bankruptcy or Chapter 13 Bankruptcy will not discharge all of your debts. Certain debts are considered non-dischargeable. All non-dischargeable debt is outline under federal bankruptcy law. The state of Alaska will have the same types of non-dischargeable debt as other states.

Creditors will have the legal right to proceed with debt collection efforts if you fail to continue payments for your non-dischargeable debt. You will need to talk to your Alaskan Bankruptcy Lawyer about all of your different types of debt.

In the state of Alaska, the following debts will not be discharged by filing bankruptcy:

• Federal, state and local taxes. May be subject to specific time rules.
• Spousal Support/Alimony
• Child Support Payments
• Most Student Loans
• Mortgage Liens
• Certain types of purchases for luxury items within 90 days of filing
• Secure Debt
• Penalties and fines by government agencies
• Fraud committed in a fiduciary role including larceny and embezzlement
• Punitive damages assessed for “willful and malicious acts”
• Debts not outlined on the schedule and forms filed with the Bankruptcy Court
• Drunk Driving fines
• Certain cash advances or purchases for luxury items with in a certain time frame.

With the changes in bankruptcy law, many individuals can not longer file Chapter 7 Bankruptcy. Many other people may not want to liquidate all of their property and possessions. Filing Chapter 13 Bankruptcy is another option. If you file Chapter 13 Bankruptcy your debts will not immediately be discharged, but you may be able to stop home foreclosure, property repossession, certain types of wage garnishments and creditor calls.

Filing Chapter 13 Bankruptcy will allow you to discharge most of your unsecure debt with in three to five years. Your Alaskan Bankruptcy Attorney will work with you to create a new payment plan to restructure your debt payments. A trustee will be assigned to your bankruptcy case to monitor and manage your plan. Creditors are not allowed to contact you directly for debt payments if you are under Chapter 13 Bankruptcy protection.  This will not include debt collection for non-dischargeable debt. After 3 to 5 years, if you have made all of your debt payments, your debts will be discharged.

An Alaska Bankruptcy Lawyer can help you complete your bankruptcy forms, file your petition and schedule, answer your questions, and help you develop your bankruptcy repayment schedule.

Some assets and property will be considered “exempt” and will be excluded from the bankruptcy process. These exclusions have been outlined under federal bankruptcy law and will be protected from your creditors. Many states have created their own list of assets which are exempt. Certain states will only allow you to use the state bankruptcy exemptions, and other states will allow you to choose between the federal bankruptcy exemptions and the state bankruptcy exemptions.

In the state of Alaska you are not allowed to use the federal bankruptcy exemptions and can only choose exemptions from the Alaska Bankruptcy Exemption list.

Most people who choose to file personal bankruptcy choose Chapter 7 Bankruptcy because it is the simplest, cheapest and quickest method to discharge unsecure debt. Filing Chapter 7 Bankruptcy may allow you to clear out all of your credit card debt, hospital bills and unsecure personal loans. Partnerships, corporations, individuals and couples may all be allowed to file Chapter 7 Bankruptcy.

The first step in filing Chapter 7 Bankruptcy is to contact an Alaska Bankruptcy Attorney who will file all the bankruptcy forms including the petition, schedule and Statement of financial forms in the appropriate bankruptcy court. You will need to provide a list of all of your assets, expenses, creditors, debts, and personal property to your attorney. After the petition is filed there will be an “automatic stay” imposed and your creditors will be temporarily unable to continue debt collection. A judge may later allow credit collections to continue.

In the second part of the bankruptcy process, a trustee is assigned by the bankruptcy court to sell your personal assets to repay your creditors. Creditors are assigned a priority rating by federal bankruptcy law to determine who will be paid first. Chapter 7 Bankruptcy usually takes between four and six months to complete.

In 2005, the Bankruptcy Abuse Prevention and Consumer Act (BAPCPA) updated the bankruptcy laws to encourage more individuals to file Chapter 13 Bankruptcy and repay their debts instead of receiving an immediate discharge of debt under Chapter 7 Bankruptcy. The BAPCPA also requires the following:

• You must pass an income test and other means testing to be able to file Chapter 7 Bankruptcy
• A certified credit counseling course must be completed prior to filing Bankruptcy
• A financial management course must be completed before your debts will be eliminated

One of the biggest changes to bankruptcy law was the implementation of the income test to determine if you are eligible to file Chapter 7 Bankruptcy. The income test will review your median income and compare it to other families of similar size in the state of Alaska. If your median income is lower than other Alaskan families who are the same size, you may be able to file Chapter 7 Bankruptcy. If your median income is higher than other Alaskan families you will have to pass additional “means testing” to determine if you can file Chapter 7 Bankruptcy.

Means testing was created to determine if you have enough disposable income to pay your creditors. Means testing will subtract expenses including: school tuition (up to $1650), taxes owed, house payment, car payment and child support from your gross income. If you have $6,000 or $100 per month left over after the calculation to pay your debts over the next 60 months, you may have to file Chapter 13 Bankruptcy. If you can not do this, but you could pay up to 25% of your income to your creditors over the next 60 months, you may have to file Chapter 13 Bankruptcy.

It is important to discuss means testing with an Alaskan Bankruptcy Lawyer to determine if you can file Chapter 7 Bankruptcy.

State median data is provided by the United States Trustee Program. For the State of Alaska, after March 15, 2009, the median income for a single wage earner is $49,325 and for a family of two it is $71,550. For a family of three it is $72,079 and for a family of four it is $91,754.

Filing Chapter 7 Bankruptcy in Alaska may allow you to discharge all or most of your unsecured debt with in four to six months. Filing Chapter 13 Bankruptcy will not allow you to immediately discharge your debt, but will allow you to create a more favorable repayment plan to repay your creditors.

If you are having financial difficulties, the bankruptcy process is one method the financial government has created to help individuals start over. It is important not to wait until your credit balances are out of control and creditors are calling day and night.  Ignoring the problem will not make it go away.

Many people suffer an unexpected crisis such as a job loss, an accident, a death, or a divorce and need help. Over one million people had to file bankruptcy in the last year. You are not alone.

If you need assistance, call an Alaskan Bankruptcy Attorney who can help answer your questions and help you determine if filing bankruptcy is right for you. Filing personal bankruptcy may allow you to:

• Eliminate most or all of your unsecure debt
• Stop creditor calls
• Erase credit card balances, penalties and interest
• Stop certain wage garnishments
• Stop property repossessions
• Eliminate medical bills