Bankruptcy
Bankruptcy refers to a consumer’s ability to receive help through Federal laws and the Bankruptcy Court, to either get rid of their debts entirely, or to make an arrangement to pay back debts in a way that the consumer can afford. Most consumers (also known as “debtors”) file for Chapter 7 or Chapter 13 bankruptcy. We will explain the differences below.
Chapter 7 Bankruptcy
- For those unemployed or who do not have a steady income
- Can wipe out your credit card and medical debts
- Can stay in your home 3-5 months longer (free!)
Requirements:
- Filing fee $299
- Two Credit Counseling Classes
- Copy of 2007 Taxes
- Pay Stubs for last 60 days
- Attorney’s fees
Debts That Cannot Be Discharged in Chapter 7 BK:
- Student Loans
- Taxes
- Court Imposed Fines or Restitution
- Back Child Support or Alimony
Chapter 13 Bankruptcy
- For wage earners or high income filers
- Can keep your house from foreclosure or car from repossession
- Can strip second mortgages off the debtor’s investment real estate
- Can stop tax levies and wage garnishment
Requirements:
- $274 Filing Fees
- Two Credit Counseling Classes
- Payment Plan that Works
- Attorney’s Fees
Debts That Cannot Be Discharged in Chapter 13 BK:
- Court Imposed Fines or Restitution
- Back Child Support or Alimony
- Student Loans
- Recent Back Taxes
