John E. Pytte
Filing for Bankruptcy Savannah | The Right Move?
Are you drowning in debt? Are creditors harassing you day and night about your unpaid bills? You are not alone! More than 1.5 million people will file for bankruptcy this year. Will you be one of them? If you have exhausted all other efforts to repay your debts, bankruptcy is a viable option to start fresh. Seen as a drastic step by many, asking the court for help will put your life back on track.
Reasons To Consider Filing for Bankruptcy Savannah
Bankruptcy is not for everyone. Many people ask the court to step in when they have medical problems, have lost their job, or have some other circumstances that have allowed them to become overwhelmed with debt. To consider bankruptcy, you must have more going out each month than what you have coming in. There are two different chapters in which you can file. The chapter that you qualify for will be determined by a test. The "Means Test" is a way that the court's screens applicants to make sure they are eligible for this type of debt relief.
The Means Test
The Means Test is given to all bankruptcy applicants, and it’s required to be filed with your petition. This examination reviews your income versus your outgoing bills. The goal of this test is to see if you have any disposable income. Disposable income can be used to repay the creditors. If you have extra income left over at the end of the month, then you will be asked to file a Chapter 13. Those who have no disposable income, and have no way to repay their debts, can submit a Chapter 7 or a total liquidation.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy erases all debts, except student loans and taxes. The liabilities included in this petition are not required to be repaid. Debtors will receive a discharge in about three to six months after they file. It all depends on the complexity of the case. In most instances, a Chapter 7 is straightforward. You can keep individual property and assets up to a certain amount, which is called exemptions. However, if you have any assets over the exception amount, these resources will be used to repay the creditors.
Chapter 13 Bankruptcy
Chapter 13 is drastically different from a Chapter 7, and it’s a bit more complex. While you still get relief from the court, you also must repay a portion of your debts. The amount you must compensate depends on the assets and disposable income. A repayment plan is created and approved by the court. The discharge won't occur until the payment plan is complete. The entire process can take three to five years from the original filing date. The court will issue a discharge once the terms of the repayment plan have been completed.
The significant advantage in a Chapter 13 is that you can keep your assets and property. As long as you have the means to repay the debts, you can avoid foreclosures, car repossessions, and save assets. Filing a Chapter 13 is reserved for those who fell on hard times but still have some resources. Repayment is usually pennies on the dollar.
Making The Decision To File
Laws regarding bankruptcy have changed over the years. You must go through credit counseling to ensure that there are no other methods to consider except bankruptcy. Additionally, your credit will receive a hit under the "public records" section that will stay on your report for 7-10 years. However, many find that their credit improves once they get things back on track. You, also, will get credit offers as soon as you file your petition. It's important not to make the same mistakes twice.
The courts allow you to file for bankruptcy without an attorney, though it's not advisable. There are numerous sections to the petition, and anything that is incorrect will be flagged by the court. Making sure the paperwork is done right, and meeting the deadlines, is imperative for success. It's a small price to pay, to have an attorney beside you in the Meeting of Creditors, and throughout the whole process.
Thinking about filing for bankruptcy in Savannah? Let Georgia Debt Relief help! Call or email our friendly staff for a conversation about your financial issues.