Are You Eligible to File Under Chapter 7 Bankruptcy?
Today, there are a large number of people who have found themselves in financial hardship. If you are one of these people, then you may discover filing for Chapter 7 bankruptcy is the best option for your particular situation. Chapter 7 bankruptcy is one option that is authorized by federal law and often referred to as a liquidation bankruptcy. It’s called this because unlike in a Chapter 13 bankruptcy filing, there is no type of repayment plan established.
Instead, the assets that are not protected by law will be collected by a trustee and then they will be sold to pay part or all of what is owed to your creditors. While you will be resolving your debts, you will have to give up many of your assets.
If you are considering this option for financial help, it is a good idea to hire a Chapter 7 bankruptcy attorney to help you. This legal professional will be able to provide you with advice and guidance to ensure you are making the best decision for your financial situation.
Who is Qualified to File Chapter 7 Bankruptcy?
When you are interested in filing for Chapter 7 in Texas, you need to figure out if you are qualified. You have to earn less than the median income in the state on a monthly basis or undergo the “means test,” which examines your financial records, which include unsecured and secured debt, expenses and income.
Examples of secured debts include car loans and mortgages, while unsecured debt includes things such as medical bills, personal loans, credit card bills and even bad checks.
After you have figured out if you are eligible to begin filing for Chapter 7, you will have all of your debts discharged after the liquidation process is finished. This is designed to provide you with a fresh financial start.
Starting the Chapter 7 Filing Process
In order to begin the process of filing for Chapter 7 in Texas, you have to file a petition with your local bankruptcy court. Additionally, you will have to provide financial statements, which include income expenses, liabilities, records of assets and your overall financial standing, in addition to any existing leases or contracts that are in your name. If you are filing for Chapter 7 bankruptcy, you will also have to undergo credit counseling, in addition to paying the court fees for filing.
What you will be able to save from the liquidation process will be dependent on where you live and is something your attorney can help you figure out. In some cases, you may be able to save your car, house or any equipment necessary for you to do your job. However, you will likely be required to give up your valuable collections, family heirlooms and savings.
In most cases, if you are filing for Chapter 7, the best thing you can do is contact an attorney. For more information or answers to any questions you have, contact the attorneys at Bryeans & Garcia, PPLC .