St. John Bankruptcy Lawyer

When every month is a struggle to pay down just enough of your debts to keep them from compounding out of control, you need help managing those debts. This help can come through a form of court intervention known as bankruptcy. Do not let our phrasing mislead you – bankruptcy does not just happen, you have to file a bankruptcy petition to begin the process of discharging your debts. When your petition is accepted, you are assigned a court trustee who oversees each stage of the bankruptcy process until your debts are repaid and your case can be closed.

Using Bankruptcy to Eliminate Debt

There are many different types of bankruptcy, each designed for a specific type of debt and recovery plan. These different types of bankruptcy are known as chapters. Chapter 7 and Chapter 13 bankruptcy are available for individuals with personal debt.

Bankruptcy is a tool you can use to eliminate many different types of unsecured and secured personal debt. These types of debt include:

• Medical debt;
• Credit card debt;
• Unpaid rent;
• Unpaid utility bills; and
• Most lawsuit judgments.

Certain debts cannot be discharged through bankruptcy, like child support debt.

Chapter 7 Bankruptcy

Chapter 7 bankruptcy is perhaps the more extreme of the two chapters designated for personal debt. With Chapter 7 bankruptcy, the filer’s nonexempt assets are liquidated and the profit from their sale is used to repay the filer’s debts. Only individuals who pass the Means Test are eligible to file for Chapter 7 bankruptcy.

To pass the Means Test, one must:

• Earn less than the median income in his or her state for a household of his or her size annually; or
• Demonstrate through the test’s questions that he or she does not have sufficient disposable income to complete a Chapter 13 bankruptcy repayment plan.

Chapter 13 Bankruptcy

As mentioned above, filing for Chapter 13 bankruptcy means you have to enter a repayment plan. Chapter 13 starts with the creation of your plan, which you submit to the court for approval. If the court approves your plan, you can repay your debts according to your plan over the next three to five years, no asset liquidation required.

If you do not pass the Means Test, Chapter 13 is your only bankruptcy option. Even if you do pass the Means Test, Chapter 13 might be the option that is more appropriate for you and your case. Your lawyer can help you make this decision.

Work with an Experienced St. John Bankruptcy Lawyer

If you are drowning in personal debt, bankruptcy can be the life raft you need to get back in control of your finances. To learn more about filing for bankruptcy to alleviate your debt difficulties, contact The Whitten & Whitten to set up your initial legal consultation with an experienced bankruptcy lawyer. During your consultation, we can determine the most effective steps for you to take next with your case.