Mount Vernon Chapter 7 Bankruptcy Lawyers
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Mount Vernon Chapter 7 Bankruptcy Lawyers | Chapter 7 Bankruptcy Attorneys in Mount Vernon, WA | Credit Card Bills | Medical Bills | Garnishments | Lawsuits
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A Chapter 7 bankruptcy is the quicker and cheaper form of the two forms of consumer bankruptcy in the United States. In most Chapter 7 cases, unsecured creditors do not receive any money and the debt is discharged, or cancelled entirely. Secured creditors, such as mortgages or car loans, are also discharged but the creditor’s right to recover the collateral survives the bankruptcy. If you want to keep the property that you are making payments on after filing a Chapter 7, you have to continue making the payments.
Since 2005, people who file a Chapter 7 have to show they are not abusing the bankruptcy system by filling out a “means test” form. The first thing the means test asks for is what your household income was in the last six months. If your average income over the last six months was over the average income for a household of your size in Washington state, then you have to fill out the rest of the means test.
This test deducts monthly expenses from the average of your last six months income to determine if there is any money left to pay unsecured creditors. If so, you have to do a five year Chapter 13 repayment plan. Some of these expenses are set by law, such as food, transportation and rent. Other expenses are your actual expenses, such as day care and taxes. The means test form can be fairly complicated.
Even if you have income left over after completing the means test, you can argue “special circumstances” to show why the means test does not present an accurate picture of your situation and the presumption that you are abusing the bankruptcy system can be rebutted. Ultimately, a bankruptcy judge will decide this issue.
Most likely, the bankruptcy judge will not have to decide anything in a Chapter 7. Your only court date will be a meeting of creditors where you meet a trustee. Usually just you and your attorney are present at this meeting – there is no point in creditors actually attending in the vast majority of cases.
The trustee will review your bankruptcy paperwork, additional documents you provide (pay stubs, tax returns, bank statements) and have you testify under oath. The trustee may investigate further to see if there are any assets he or she can take to pay creditors but in most cases a debtor is finished dealing with the trustee at the meeting of creditors.
Most people who file a Chapter 7 do not have to worry about losing property. The law allows people to keep their vital property by providing “exemptions”. Overall, a Chapter 7 is a fairly easy process but there are many things you need to be aware of and hiring an experience bankruptcy attorney will make the process much less risky and stressful.
A Mount Vernon Chapter 7 bankruptcy is the quicker and cheaper form of the two forms of consumer bankruptcy in the United States. In most Chapter 7 cases, unsecured creditors do not receive any money and the debt is discharged, or cancelled entirely.
Secured creditors, such as mortgages or car loans, are also discharged but the creditor’s right to recover the collateral survives the bankruptcy. If you want to keep the property that you are making payments on after filing a Chapter 7, you have to continue making the payments.
Since 2005, people who file a Chapter 7 have to show they are not abusing the bankruptcy system by filling out a “means test” form. The first thing the means test asks for is what your household income was in the last six months. If your average income over the last six months was over the average income for a household of your size in Washington state, then you have to fill out the rest of the means test.
This test deducts monthly expenses from the average of your last six months income to determine if there is any money left to pay unsecured creditors. If so, you have to do a five year Chapter 13 repayment plan. Some of these expenses are set by law, such as food, transportation and rent. Other expenses are your actual expenses, such as day care and taxes.
The means test form can be fairly complicated. Even if you have income left over after completing the means test, you can argue “special circumstances” to show why the means test does not present an accurate picture of your situation and the presumption that you are abusing the bankruptcy system can be rebutted. Ultimately, a bankruptcy judge will decide this issue.
Most likely, the bankruptcy judge will not have to decide anything in a Chapter 7. Your only court date will be a meeting of creditors where you meet a trustee. Usually just you and your attorney are present at this meeting – there is no point in creditors actually attending in the vast majority of cases.
The trustee will review your bankruptcy paperwork, additional documents you provide (pay stubs, tax returns, bank statements) and have you testify under oath. The trustee may investigate further to see if there are any assets he or she can take to pay creditors but in most cases a debtor is finished dealing with the trustee at the meeting of creditors.
Most people who file a Chapter 7 do not have to worry about losing property. The law allows people to keep their vital property by providing “exemptions”. Overall, a Chapter 7 is a fairly easy process but there are many things you need to be aware of and hiring an experience bankruptcy attorney will make the process much less risky and stressful.