Bankruptcy Blog

Over 85% of bankruptcy filers in Colorado, file for Chapter 7 Bankruptcy. Chapter 7 Bankruptcy is considered a “liquidation” bankruptcy. Individuals, corporations, couples or partnerships may be eligible to file Chapter 7 Bankruptcy. Under Chapter 7 Bankruptcy, a trustee will be assigned by the bankruptcy court to sell your non-exempt personal assets than use the proceeds from the sale to repay your creditors.

Bankruptcy laws have been revised to make it more difficult for individuals to file Chapter 7 Bankruptcy. New bankruptcy laws now require credit counseling, completion of a financial management course and additional “means” testing to determine if you are eligible to file Chapter 7 Bankruptcy. The laws were changed to force more individuals to repay all or a portion of their debt under Chapter 13 Bankruptcy.

In Colorado in 2009, over fifty-five hundred people have filed bankruptcy. This is almost five out of every one thousand Colorado residents. If you are unable to pay your creditors, and you live in the state of Colorado, you are facing and of the following, filing bankruptcy might be your best financial option.

• Harassing creditor phone calls
• Sky rocketing credit card debt and penalties
• Home foreclosure
• Repossessions
• Wage Garnishments
• Loss of job
• Unexpected Medical crises

The United States government has created bankruptcy which is “a legally declared inability or impairment of ability of an individual or organization to pay its creditors.” Bankruptcy may be a legal option for you to discharge a portion or all of your unsecured debt and make a fresh start.

If you are considering filing Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, it is important to contact a Colorado Bankruptcy Attorney who can answer your bankruptcy questions, identify what type of bankruptcy might be best for you or your family and help you analyze your debts and assets. Bankruptcy is an important financial decision and it is a good idea to contact a Colorado Bankruptcy Lawyer prior to filing for bankruptcy.

Not all debt will be discharged by filing Chapter 7 or Chapter 13 Bankruptcy. It is important to discuss all of your assets and liabilities with a California Bankruptcy Lawyer so you will understand what debts will not be discharged. In the state of California general debts that will not be discharged can include:

• Alimony/Spousal/Child Support
• Taxes
• Certain Types of Student Loans
• Certain types of purchases for luxury items within 90 days of filing
• Fines owed to federal or California government agencies
• Debts accrued as a result of fraudulent activity
• Recent Cash Advances

If you are consider filing either Chapter 7 or Chapter 13 Bankruptcy it is important to consider all of the long term consequences. It could affect your ability to get personal loans and it may negatively affect your credit rating for many years. Then again, once you clear some debt that you cannot pay and continue to pay on other loans, you may improve your credit rating.

If you do not qualify to file Chapter 7 Bankruptcy or if you have assets you would like to keep, you may be able to file Chapter 13 Bankruptcy. To qualify to file Chapter 13 Bankruptcy in California, you must be a wage earner and have the ability to pay back a portion of your debts through a bankruptcy repayment schedule.

Chapter 13 Bankruptcy will give you the ability to stop home foreclosure, repossessions and harassing creditor phone calls, but unlike filing Chapter 7 Bankruptcy, it will not immediately discharge your debt. Instead, you will work with your California Bankruptcy Attorney to develop a 3 to 5 year repayment schedule to repay a portion or all of your personal debt. Your bankruptcy repayment schedule will be supervised by the California Bankruptcy Court.

Bankruptcy laws are determined at the federal level, but California State laws do allow for a few differences including a state law which allows a large homestead exemption for equity in your primary residence, laws regarding community property, and a single spouse discharge. If you are filing bankruptcy in California it is important to talk to a California Bankruptcy Attorney who can review California state bankruptcy laws with you.

Chapter 7 Bankruptcy is the most common type of personal bankruptcy filed in the state of California. Chapter 7 Bankruptcy is a liquidation of certain non-exempt assets. If you qualify to file Chapter 7 Bankruptcy in California, the California Bankruptcy Court will appoint a trustee who will help you liquidate your assets to pay your creditors. Federal Bankruptcy laws will determine which creditors will be paid first.

As mentioned in previopus posts, since 2005, the Bankruptcy Prevention and Consumer Protection Act has established tougher criterion for qualifying to file Chapter 7 Bankruptcy. If you do not meet the additional requirements you may be able to file Chapter 13 Bankruptcy and repay either a portion or all of your personal debt through a bankruptcy repayment schedule. It is important to contact a California Bankruptcy Attorney who can determine if you qualify to file Chapter 7 Bankruptcy.

Bankruptcy is a legal process created by federal bankruptcy laws which allows an individual to get a fresh financial start. If you are one of the many California residents facing creditor’s harassing phone calls, home foreclosure or the inability to pay your bills, filing bankruptcy in California may be the best way for you to legally discharge your debt or develop a payment schedule to pay your creditors.

Thousands of California residents are facing a variety of financial crises including:

• High medical bills
• Job loss
• Outrageous credit cards penalties and fees
• Divorce/separation
• Unexpected Death
• Business failure

Current Bankruptcy Laws have made it more difficult to file for Chapter 7 Bankruptcy. New Bankruptcy requirements include a “means test”, credit counseling prior to filing for bankruptcy, and the completion of certain financial management courses. Due to the increased complexity of filing bankruptcy in California, it may be a good idea to consult a California Bankruptcy Attorney. An experienced California Bankruptcy Attorney can help you examine your finances and determine if Chapter 7 bankruptcy or Chapter 13 bankruptcy is the best option for you.

There are certain debts that will not be discharged by filing either Chapter 7 Bankruptcy or Chapter 13 Bankruptcy in Oklahoma. Non-dischargeable debt can be complicated and you should contact an Oklahoma Bankruptcy Attorney to discuss debt. Non-dischargeable debt is outlined under federal bankruptcy law and will be the same in the state of Oklahoma as in other states. In the state of Oklahoma 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.

Filing Chapter 13 Bankruptcy will offer several advantages over filing Chapter 7 Bankruptcy. You may be able to save your home by stopping a home foreclosure. You must, however, continue paying your mortgage during the bankruptcy process. Another advantage of Chapter 13 Bankruptcy is you will be able to create a bankruptcy repayment plan and pay your debt payments to a trustee who will distribute debt payments to your creditors. Your creditors can have no direct contact with you while you are under Chapter 13 protection (certain creditors who are collecting for non-dischargeable debt may be able to continue collection efforts).

Chapter 13 will not immediately discharge your debt, but will allow you to repay your debt over a three to five year time period. At the end of the bankruptcy plan, your qualifying debt will be discharged.

If you are considering filing Chapter 13 Bankruptcy, contact an Oklahoma Bankruptcy Attorney who can help you complete the necessary bankruptcy forms, create your repayment plan and go to court for you.

Federal bankruptcy laws have been created to exempt certain assets from the bankruptcy process. The bankruptcy laws which protect these properties are called exemptions. Determining what bankruptcy exemptions you will qualify for can be one of the most complex parts of the bankruptcy process. Although federal laws determine exemptions, certain states have created their own bankruptcy exemptions. Depending on the state where you live, you may be able to choose either the state or the federal exemptions. Certain states will only let you use the state exemption list. In the state of Oklahoma you may only use the Oklahoma State Exemptions.

Chapter 7 Bankruptcy is called a straight bankruptcy because it is a liquidation of your assets. An individual will give their non-exempt property to a court appointed trustee who converts the assets to cash and redistributes the proceeds to the creditors. The debt will be discharged between four and six months. Many individuals who file Chapter 7 Bankruptcy will have no assets this type of bankruptcy is called a “no asset” case. If you do have property, there are certain assets that will be exempt from the bankruptcy.

Most unsecured debt will be discharged by filing Chapter 7 Bankruptcy including: hospital bills, unsecured personal loans and credit card debt. Individuals, corporations, partnerships and couples may all qualify for Chapter 7 Bankruptcy. Chapter 7 Bankruptcy can be easy, quick and inexpensive.

The first step in Chapter 7 Bankruptcy is to meet with your Oklahoma Bankruptcy Attorney. You bankruptcy attorney will determine if you qualify to file Chapter 7 Bankruptcy or Chapter 13 Bankruptcy. If you qualify for Chapter 7 Bankruptcy, your Oklahoma Bankruptcy Lawyer will file your bankruptcy petition in the bankruptcy court serving your area. In addition to the bankruptcy petition, you attorney will file a schedule of your liabilities and assets, a list of your expenses and income, information about your financial affairs and information about all of your leases and contracts.

After the bankruptcy petition is file, an automatic stay will temporarily force all creditors to stop debt collection efforts. Under Chapter 7 Bankruptcy, a bankruptcy judge may determine there is cause and allow debt collection efforts to continue.

In 2005, the Bankruptcy Abuse Prevention and Consumer Act (BAPCPA) made it more difficult for individuals to qualify to file Chapter 7 Bankruptcy. Individuals now must take a credit counseling course prior to bankruptcy, complete a financial management course prior to the discharge of their debt and pass an income test to qualify for Chapter 7 Bankruptcy.

Under the BAPCPA, you will have to pass an income test to see if you qualify for Chapter 7 Bankruptcy. The income test will measure your monthly income against the median income of other households of similar size in the state of Oklahoma. If the income test determines your income is less or the same as the median income of other Oklahoma residents, you can file Chapter 7 Bankruptcy. If your median income is higher, you must pass additional “means tests”.

The means test is used to figure out if you have enough disposable income after subtracting your expenses such as home mortgage payment, car payment, taxes, child support and tuition (up to $1650) to make payments on your unsecured debt. If you can pay $6,000 or 100 per month over the next 60 months in debt repayment, you may have to file Chapter 13 Bankruptcy. If you can not do this, but you could pay up to 25% of your income toward debt repayment over the next 60 months, you may have to file Chapter 13 Bankruptcy. The goal of the tougher law is to force more individuals with disposable income to make debt payments by filing Chapter 13 Bankruptcy.

State median data is provided by the United States Trustee Program. For the State of Oklahoma, after March 15, 2009, the median income for a single wage earner in the state of Oklahoma was $38,244 and for a family of two it was $51,322. For a family of three it was $54,494 and for a family of four it was $62,049.

The information provided for means testing is general information and should not be considered legal advice. To find out if you can file Chapter 7 Bankruptcy it is important to talk to an Oklahoma Bankruptcy Attorney.

Bankruptcy laws were created by the federal government to provide a plan that allows an individual who is unable to pay his creditors, a chance to resolve his debt obligations through a division of his assets among his creditors.

Bankruptcy law provides the framework for the division and will ensure that all creditors are treated with a measure of equality. If you file Chapter 7 Bankruptcy, you may be able to free yourself of most of your accumulated unsecured debt and obligations, after your assets are distributed. Discharging of the debt will occur even if the debts are not paid in full. If you file Chapter 13 Bankruptcy, your unsecured debt obligations will not be discharged immediately, but you will have a chance to repay a portion or all of your debt with a new repayment plan.

Filing bankruptcy is a major financial decision and should not be done with out consulting an Oklahoma Bankruptcy Attorney. An Oklahoma Bankruptcy Attorney can answer you bankruptcy questions, review your assets, debts and income and determine what type of bankruptcy you can file.

You might consider filing bankruptcy if:

• You can only afford to pay the minimum payments on credit cards and loans
• You are constantly receiving notices from creditors or harassing phone calls that your bills are past due
• You can not make your mortgage payment each month
• You are unable to pay your bills due to a job loss, divorce, separation, death or high medical costs
• You are only paying the minimum amounts on your bills
• You will not be able to budget yourself out of debt within five years
• You are facing a home foreclosure