Bankruptcy
The Firm maintains an active practice in Bankruptcy Court. Our practice includes representation of debtors in Consumer Bankruptcy Cases, primarily. The Firm is available to represent creditors in all aspects of Bankruptcy Court practice.
Chapter 7 Bankruptcy vs. Chapter 13 Bankruptcy
There are two main ways to file personal bankruptcy under the U.S. Bankruptcy Code: Chapter 7 and Chapter 13 bankruptcy.
Discover which type of bankruptcy may help you, then call Davis, Goss & Williams at 601-981-2800 to talk about your eligibility to file:
| Chapter 7 (Liquidation) | Chapter 13 (Wage Earners Plan) |
|---|---|
| Chapter 7 is commonly used when: You have little property except for the basic necessities like furniture and clothing. You have little or no money left after paying basic expenses each month-or you’re not even meeting basic expenses | Chapter 13 is commonly used when: You have significant equity in a home or other property and you want to keep it. You have regular income and can pay your living expenses, but you can’t keep up the scheduled payments on your debts. |
| Advantages of Chapter 7: Most unsecured debts can be discharged (completely eliminated) The process moves quickly-you may receive your discharge in a just a few months Creditors can’t contact you while the automatic stay is in effect-or after debts are discharged. | Advantages of Chapter 13: You can keep most of your property while spreading out time to pay past due accounts. You’ll have 3-5 years to catch up delinquent accounts according to a schedule that you and the bankruptcy trustee have agreed is workable for you. You’ll make one monthly payment to the bankruptcy trustee for distribution-you’ll have no direct contact with creditors during the protection period of 3-5 years. Co-signers may be protected |
| Who can file under Chapter 7? Debtors who have qualified under the ‘means test’ and completed a required pre-filing session with a credit counselor may file for Chapter 7 bankruptcy protection | Who can file under Chapter 13? Any individual debtor whose unsecured debts are below $360,475 and whose secured debts are less than $1,081,400. |
Which Bankruptcy Is Best For Me? Ask a Bankruptcy Lawyer Today.
Have bankruptcy questions about your specific circumstances? Call Davis, Goss & Williams at (601) 981-2800 for a FREE CONSULTATION.
Bankruptcy Laws are Designed to Help
Job loss, divorce, a medical emergency or other catastrophic event can make it difficult to keep on top of debt. Millions of people have used U.S. bankruptcy laws to eliminate debt and get a fresh start.
Bankruptcy laws are designed to help individuals and families struggling with debt.
Chapter 7 vs Chapter 13 Bankruptcy
Bankruptcy laws give individuals seeking debt relief to main options: Chapter 7 debt eliminations and Chapter 13 reorganization.
In Chapter 7 bankruptcy, debts like credit cards, medical bills and utility bills can be completely wiped out. Some property may be used the bankruptcy courts to repay creditors–however, bankruptcy laws in each state allow individuals to keep much of their most valuable assets.
In Chapter 13 bankruptcy, individuals past-due on mortgage payments or auto loans work out a
repayment plan in bankruptcy court. Filers who also have credit debt or medical debt may be able to reduce or eliminate those bills.
Filing Bankruptcy is Not as Uncommon as You May Think
Every day, people just like you decide to file for bankruptcy.
With this economy, bankruptcy just doesn’t hold that old stigma is may have had a decade ago.
Most of us are struggling with debt–and many of us have lost income thanks to the economy.
Bankruptcy laws have helped millions of Americans get out of debt. They’ve also helped people stop creditor harassment through the bankruptcy automatic stay.
If you’re tired of creditors calling at all hours and you’re looking for relief, call Davis, Goss & Williams at (601) 981-2800 to find out whether filing bankruptcy could help you.
What Happens After Bankruptcy?
If you’re thinking about filing bankruptcy, you’re wondering how bankruptcy affects credit.
It’s true that bankruptcy stays on a credit report for up for 10 years ( maybe less depending on which type of bankruptcy is filed), but once the slate is essentially “wiped clean” after a successful
bankruptcy filing, people can instantly start rebuilding their credit.
In fact, many people even gain stronger credit scores after filing bankruptcy because their old debt is gone and they can start fresh.
Think about it–your credit probably wasn’t that great to begin with. Bankruptcy was designed to clear debt to give people a fresh chance.
What is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy, also known as “liquidation”, is a legal process by which most unsecured debts can be discharged, or wiped out. Chapter 7 bankruptcy is known as liquidation because any nonexempt assets the debtor has may be liquidated (sold) by the trustee for the benefit of creditors. Many Chapter 7 bankruptcy debtors have no non-exempt assets, and so there is no liquidation, and unsecured debts are simply discharged. There are, however, certain unsecured debts that are not dichargeable in Chapter 7 bankruptcy.
Can I File Chapter 7 Bankruptcy?
To file for Chapter 7 bankruptcy, you must qualify under the Chapter 7 means test. The means test first compares your income to the median income in your state. If your income is lower than the median income in your state, you can file for Chapter 7 bankruptcy. However, if your income is greater than the median income in your state, other calculations regarding your income and allowable expenses are required to determine whether or not you can file Chapter 7 bankruptcy.
Is Chapter 7 Bankruptcy the Right Option for Me?
Chapter 7 bankruptcy may eliminate debt under the U.S. Bankruptcy Code.
Chapter 7 bankruptcy may be a good option for people who are facing lots of unsecured debt, such as medical bills or credit card debt and have few assets.
Among other benefits, filing Chapter 7 bankruptcy may:
eliminate most or all of your unsecured debt, allowing you to rebuild your credit;
eliminate your unsecured debt through a Chapter 7 debt discharge;
silence your creditors through an automatic stay order; and
keep you from losing our exempt assets like your home or car.
For more information on Chapter 7 bankruptcy call Davis, Goss & Williams at (601) 981-2800.
What is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy, is a full or partial repayment plan administered by the bankruptcy court.
The debtor submits a plan for approval and, when a plan is approved, makes monthly payments to the bankruptcy trustee. The trustee makes payments to creditors in accordance with the terms of the plan. The repayment period may be from 3-5 years. At the end of the repayment period, if all payments have been made according to the plan, remaining unsecured, dischargeable debt may be discharged.
Who Can File Chapter 13 Bankruptcy?
In one sense, it’s easier to qualify for Chapter 13 bankruptcy than for Chapter 7 bankruptcy. There’s no means test for Chapter 13 bankruptcy, and some debtors who cannot qualify for Chapter 7 bankruptcy opt to file under Chapter 13 bankruptcy instead. However, Chapter 13 bankruptcy requires a regular income that will allow you to create a budget and make predictable and reliable payments to the trustee.
Is Chapter 13 Bankruptcy the Right Option for Me?
A Chapter 13 bankruptcy can stop mortgage foreclosure and other repossessions.
Chapter 13 bankruptcy is often a good option for people who are facing short-term financial setbacks, such as a job loss or illness. It also may be a good choice for someone who is suddenly faced with unexpected expenses.
In short, a Chapter 13 repayment plan can silence creditors through an automatic stay and give a person the chance to repay their debts in three to five years after the bankruptcy filing.
For more information, please visit Total Bankruptcy’s Chapter 13 bankruptcy section.
Is Chapter 7 or Chapter 13 Bankruptcy Better?
The answer to this question depends on your specific circumstances. Generally speaking, Chapter 7 bankruptcy is better for people who have a lot of unsecured debts, like credit card debt and medical bills. If you don't have much property, your income is low, and most of your debts are unsecured, you might want to consider Chapter 7 bankruptcy. Chapter 13 bankruptcy, on the other hand, tends to be a better option for those who have regular income and non-exempt property they'd like to keep. An Attorney with Davis, Goss & Williams can review your specific financial circumstances and advise you as to which type of bankruptcy protection might be best for you.
How Do I Choose a Personal Bankruptcy Lawyer?
Deciding to file bankruptcy is a major decision. You'll want advice from a bankruptcy lawyer who knows the bankruptcy laws-especially if you have assets that you want to protect from seizure. When looking for a bankruptcy attorney, it's a good idea to select a lawyer who concentrates in that area of law. Bankruptcy laws also vary from state to state, so a local bankruptcy lawyer could be of great assistance to you. You'll also probably want someone who is upfront, honest and can help guide you through the whole bankruptcy process.
Does the New Bankruptcy Law Affect Me?
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) was passed by Congress and signed into law by President George W. Bush on April 20, 2005. Since then, there have been various amendments and exemptions to the law. Although this new bankruptcy law has prevented some people from being able to file bankruptcy, most people are not turned down from filing bankruptcy protection. The biggest change the BAPCPA brought was that now there are additional bankruptcy requirements for people seeking bankruptcy (like the debtor education course and credit counselingbriefing). A debtor must complete the requirements in order to have a successful bankruptcy.
Will Filing Bankruptcy Affect My Credit?
Bankruptcy can be an effective way to regain control and tackle mounting debt. Many people find that their credit scores improve not too long after they file bankruptcy. You're credit will likely be affected if you decide to file bankruptcy-but that's not necessarily bad news! Many people who decide to file bankruptcy don't have the greatest credit to begin with and they find that once their debt is relieved, their credit score starts to improve. But you should also know that most types of bankruptcy will stay on your credit report for a period of at least ten years. (In some cases, the time period can be reduced.) During that time, it may negatively affect your credit. But bankruptcy can also provide you with a chance to "start fresh" and rebuild your credit. Keep in mind that how your credit will be affected will depend on a number of factors, such as where your credit level is at today and which type of bankruptcy you file.
Can Co-Signers Be Protected In Bankruptcy?
Co-signers can be protected in certain bankruptcies. If you are concerned about protecting your co-signers, a bankruptcy lawyer may be able to help you determine which bankruptcy filing is best for you.
In general, if you decide to file Chapter 7 bankruptcy, creditors are still able to proceed with collection efforts against your co-signers-even if you were let off the hook for the debt. However, if you file Chapter 13 bankruptcy, a co-signer is protected if the following provisions are met:
the debt must be a consumer debt;
the debt can't be incurred in the ordinary course of business;
the co-signer can't benefit from the proceeds of the debt; and the debtor sticks to the Chapter 13 bankruptcy payment agreement.
You should note that if you fail to complete the requirements of your Chapter 13 repayment plan,the creditors have the legal right to pursue your co-signers.
It's important that you choose a qualified bankruptcy lawyer to handle your case-especially when third parties such as co-signers are involved.
What is a Debt Discharge?
Under Chapter 7 bankruptcy, a debt discharge eliminates debt.
That's right-the Chapter 7 debt discharge releases a debtor from personal liability for his or her debts. That means that the debtor never has to pay those debts off.
There are requirements to who may be eligible to file Chapter 7 bankruptcy. A bankruptcy lawyer may be able to help you decide if you qualify for Chapter 7 bankruptcy and if it's the right debt solution for you.
How Can I Stop Creditor Harassment?
We don't have to tell you that creditors can be annoying.
But we can tell you that you may have the power to silence them.
If you decide to file bankruptcy, you can silence your creditors and reclaim your phone, voicemail and mailbox. This is because a bankruptcy filing results in an automatic stay order, which makes it illegal for creditors to attempt to collect on your debt.
Chapter 13 Bankruptcy Timeline
The bankruptcy filing process involves a number of filings and deadlines. For someone who hasn't navigated the bankruptcy courts, it can be an overwhelming process.
Call Davis, Goss & Williams for a Free Consultation at (601) 981-2800.
The following timeline illustrates the relevant dates in the typical
Chapter 13 bankruptcy case. In the typical Chapter 13 bankruptcy case, you will be required to establish and follow a debt repayment plan, which can last from 3-5 years.
TIMELINE
Four Years Before Your BankruptcyYou are not eligible for a discharge under Chapter 13 if you received a previous discharge under Chapter 7, 11 or 12 within the prior four-year period. If the prior case was a Chapter 13, you must wait two years before you are eligible for another Chapter 13 discharge.
Chapter 7 Bankruptcy Timeline
- Typically, a Chapter 7 bankruptcy case is relatively quick. In most cases, a case will be completed and discharged within six months of the bankruptcy filing.
However, there are a number of important dates that can affect your right to file a case and get the relief available. The following timeline illustrates the relevant dates in the typical Chapter 7 bankruptcy case. Davis, Goss & Williams can help you with the details that may affect your case.
6-8 Years Before Your Bankruptcy
If you received a Chapter 13 or Chapter 12 discharge in a case filed within the previous six years, you will be eligible for a Chapter 7 discharge generally if, in the prior case, you paid at least 70 percent of your allowed unsecured claims, and your plan was proposed in good faith and was your best effort.
You are ineligible for a Chapter 7 discharge until eight years from the date you filed a prior Chapter 7 and received a discharge.
1 Year Before Your Bankruptcy
If you have tried to delay or defraud your creditors by transferring, hiding, or destroying your property within the 1-year period prior to your bankruptcy, the court may deny you a Chapter 7 discharge and even allow your creditors to recover the property that you transferred.
Also, if you pay back one of your creditors who is also a relative or close business associate ("insider") at any time within the 1-year period prior to the filing of your bankruptcy case, the payment may be deemed an unlawful preference and the court may recover all such payments and distribute them to your other creditors.
If you had a prior bankruptcy case dismissed within one year of the time you file a Chapter 7 case, the Automatic Stay entered in the Chapter 7 case will be terminated within 30 days unless you can demonstrate that the Chapter 7 case was filed in good faith.
180 Days Before Your BankruptcyIf within 180 days before your bankruptcy you had a prior bankruptcy case that was dismissed because you failed to obey court orders or you voluntarily requested a dismissal, then you may not file your bankruptcy case until this 180-day period expires.
Also, within the 180 days before your bankruptcy filing, you must receive an individual or group briefing from an approved nonprofit budget and credit counseling agency.
90 Days Before Your Bankruptcy
You must be a resident of the state in which you intend to file your bankruptcy case for at least 90 days before the filing. If you have not lived in the state in which you intend to file your case for at least 90 days, you may only file your case in the state where you have resided, or which has been the location of your principal assets, for a majority of the prior 180 days.
Also, if you pay back any of your creditors, even one who is not a relative or close business associate ("insider"), at any time within the 90-day period prior to the filing of your bankruptcy case, the payment may be considered an unlawful preference and the court may recover all such payments and distribute them to your other creditors.
If you incurred new credit of $500 or more for "luxury goods or services" within the 90-day period before your bankruptcy, or if you obtain a cash advance in the amount of $750 within 70-day period before your bankruptcy, the debt is presumed to be non-dischargeable.
Your Case is Filed!
Your case is formally commenced when you file your bankruptcy petition with the appropriate bankruptcy court. In most cases, as soon as you file your petition, the court will enter an Automatic Stay order prohibiting your creditors from taking or continuing any collection or legal action against you. This means no more harassing letters or phone calls for as long as the automatic stay remains in effect, generally for the duration of your bankruptcy case.
Next, the court will send a notice of your case to all of the creditors listed in your petition.
Additionally, the bankruptcy court will assign a bankruptcy trustee to oversee your case. The trustee is a federal employee appointed by the court to monitor your case and make sure you are eligible for bankruptcy. The trustee will review your petition, make sure that it is complete, and then schedule a meeting of your creditors.
15 Days After Your Case is Filed
You have a deadline of 15 days after you file your petition to file certain financial "schedules" with the court-documents declaring your assets, liabilities, expenses, income, and a statement of your affairs. In most case, however, your attorney will file these schedules with your petition.
Approximately 15 Days After Your Case is Filed
Within approximately 15 days after you file your case, the court will mail the Notice of Commencement of Case to you and to all of the creditors listed in your petition. This notice will inform you of the date set by the court for the meeting of your creditors, and the deadlines for your creditors to object to your case and file their claims against you.
Approximately 30 Days After Your Case is Filed
Within 30 days after you file your case, or before the meeting of your creditors if that occurs first, you are required to file a Statement of Intention. In this document, you advise the court whether you intend to keep your property that serves as collateral for your debts, or whether you intend to surrender it to your creditors.
If you intend to keep the property, you must indicate your intention to: (1) reaffirm your debts and continue making all of your payments on those debts; or (2) redeem the property by paying the fair market value for it, in which case you will receive a discharge of debt owed over the fair market value of the item.
You must serve a copy of your Statement of Intention on the bankruptcy trustee and your creditors at the time you file it with the court.
45 days After Your Statement of Intention is Filed
You have 45 days after your Statement of Intention is filed to surrender or keep your property as you indicated in your Statement and make all necessary payments.
Approximately 6 Weeks After Your Case is Filed
The court will hold the Meeting of Your Creditors about six weeks after your bankruptcy case is filed. At least seven days before this meeting, you are required to provide to the trustee and any creditor requesting it a copy of your most recently filed tax return.
The court-appointed trustee will preside over this meeting. At the meeting, which you are required to attend, you will be asked to testify under oath as to the accuracy of the statements in your petition. However, most creditors typically do not appear at the meeting, and you will not be before a judge. The meeting is very informal, and in most cases will last no more than 10 minutes. If you do not attend the meeting, your case will be dismissed.
Within 45 days after you file your petition, you must file a statement containing a certificate from your attorney that you received an explanation of the various chapters available to you under the bankruptcy code, evidence of any payments you've received from any employer within 60 days of your filing, an itemized statement of your monthly income, and an estimate of any increase Income or expenditures you expect over the next 12 months.
30 Days After The Meeting of Your Creditors
The bankruptcy trustee and your creditors have to 30 days after the conclusion of the Meeting of Creditors in which to make objections to your exemptions.
60 Days After The Meeting of Your Creditors
Your creditors have 60 days after the date first set for the Meeting of Your Creditors to object to the discharge of any of the debts listed in your petition and schedules.
Your creditors can object to your request to discharge a debt if the debt was obtained or incurred as a result of any of the following types of misconduct: fraud; embezzlement or larceny; and any willful or malicious injuries you have caused others; or a divorce or separation (this does not include debts for child support and spousal maintenance, which are non-dischargeable by law).
Additionally, your creditors can object to the discharge of all your debts if you have engaged in any of the following conduct: concealment or destruction of property or financial records; false statements; withholding information; failing to explain losses; failure to respond to material questions; or a discharge in a prior Chapter 12 or 13 case filed within the previous 6 years or a Chapter 7 case filed within the previous 8 years.
The trustee must move to dismiss your case within this time period if he finds that the granting of relief would be an abuse of the provisions of Chapter 7. You will receive your Chapter 7 discharge 60 days after the meeting of your creditors You will receive your discharge as soon as the 60-day time period for objecting to discharge or moving to dismiss your case expires. Even if you receive your discharge, the trustee may, however, move to set it aside if you do not turn over nonexempt property or if you commit other bankruptcy violations.
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 imposes one last hurdle before you're eligible for your discharge--the financial education requirement. This requires you to complete an instructional course concerning personal financial management. Your attorney can refer you to an approved financial management class.
90 Days After The Meeting of Your Creditors
All of your creditors (except for government entities) must file their proofs of claim (these are documents your creditors submit to the court specifying how much you owe them) within 90 days after the first date set for your creditor meeting if they wish to share in the payments from your case if any assets are available for liquidation.
Government entities that have claims against you (such as the IRS) have 180 days after the filing of your case to submit their proofs of claim.
Talk to Davis, Goss & Williams Today
If your creditors are making your life miserable, bankruptcy may be able to help the financial pain disappear.
Bankruptcy Pros and Cons
There's no question that deciding whether or not to declare bankruptcy is a difficult, agonizing choice. A bankruptcy will affect your future credit, your relationships and your self-image. But it can also improve your short-term quality of life and possibly keep you from losing your home, car and other essentials.
Personal bankruptcy is generally considered the debt management tool of last resort because the results are long-lasting and far-reaching. It's the financial equivalent of major surgery -- not something you should undergo unless it's absolutely necessary. You need to study the pros and cons carefully before making a decision. Then, if you decide bankruptcy is the way to go, it's important to do it right. The following pages will help you do just that.
| CONS | PROS |
| · You will lose all your credit cards (unless you pay them off before filing.) You may also have to give up some luxury possessions. | · When you file bankruptcy, it stops all collection actions by creditors, including foreclosures, repossessions, and garnishments. If you have filed with an attorney, she or he shields you by handling all inquiries from creditors. |
| · A recent bankruptcy makes it nearly impossible to get a mortgage (although you should be able to do so within about five years). | · Most states allow you to exempt your home, car and other essentials, so you will not wind up homeless and unable to get around. |
| · A bankruptcy stays on your credit report for 10 years, making it difficult to acquire credit, buy a home or car, get life insurance, or sometimes get a job. | · Declaring bankruptcy now can get you started sooner on rebuilding your credit and your life. If there is another disaster, you may be able to amend your existing Chapter 13 plan to accommodate it. |
| · Not all debts may be "discharged" in a bankruptcy. Student loans and back taxes (within 3 years) are prime examples. | · While nothing will get rid of student loan debt, at least bankruptcy will prevent your lenders from aggressive collection action. |
| · Bankruptcy is an admission of defeat, an embarrassment. | · So is being sued for bad debts, having your car repossessed or your home foreclosed on. |
| · If I declare bankruptcy, my name will be in court records and may appear in the newspaper. | · If your creditors sue you, your name will be in court records and may appear in the newspaper. |
| · You will have to explain to a judge or trustee how you got into a financial mess. | · Both judges and trustees have heard far worse stories than yours. |
| · It will be a long time before you are able to get credit cards again. | · Good. Credit cards helped you get into this mess. They can get you into another one just as quickly. |
1. If debt is wrecking your life, call DG& W. They can get you back on track.
2. If your finances are out of control, call DG& W. They can help you regain control.
3. If you are sinking in debt, DG & W can help you repay your debt with dignity and peace of mind.
4. If the pressure is too much, call DG & W for relief.
5. If you are being blown away by hard times, call DG & W.
6. If you are barely hanging on due to rising debt, call DG & W.
RED LIGHT:
- STOP FORECLOSURE
- STOP GARNISHMENT
- STOP LAWSUITS
- STOP HARASSING PHONE CALLS
- STOP OUT OF CONTROL DEBT
- STOP FIGHTING OVER BILLS
GREEN LIGHT:
- START ENJOYING LIFE AGAIN
- START FEELING GOOD ABOUT YOURSELF
- START ANSWERING YOUR PHONE
- START HAVING PEACE OF MIND
- START TAKING CONTROL OF YOUR LIFE
Call Davis, Goss & Williams at 601-981-2800 for a free bankruptcy consultation before you lose everything.