Struggling with debt can be a silent and isolating experience. Although so many individuals, families, and small businesses across the country have accumulated significant debt, the social stigma surrounding bankruptcy persists. As a result, those laden with debt often feel ashamed to discuss their circumstances with others—even legal professionals who can help them identify a path forward. If you are worried that you will never be able to get your credit card bills or other debts under control, consider enlisting the assistance of a trusted and caring Watertown, New York, attorney. Your lawyer will not judge you; instead, their goal is to help you take the necessary steps to achieve the fresh start you need to feel hopeful about your financial future once more. This post will explore some of the most common reasons people file for Chapter 7 bankruptcy and what to expect during and after the bankruptcy process.
A Brief Overview of Chapter 7 Bankruptcy in New York
Chapter 7 bankruptcy allows those struggling with debt to discharge (wipe away) their debt, while retaining their assets (house & car). From there, you will start rebuilding their credit score immediately and take back control of your finances. Below are some key elements of a Chapter 7 bankruptcy case in New York.
Chapter 7 Eligibility Requirements
There are a few eligibility requirements to qualify for a discharge under Chapter 7. First, the petitioner must pass what’s known as the “means test,” where they show that their current monthly income falls below the state’s median monthly income based on their household size. In some cases, even those whose monthly income surpasses the state median may be allowed to proceed with a chapter 7 bankruptcy filing. Additionally, the petitioner cannot file a Chapter 7 bankruptcy petition if a previous chapter 7 bankruptcy petition was filed within the preceding 8 years.
What Happens After Filing a Chapter 7 Bankruptcy Petition
Once you file the required paperwork with the bankruptcy court, the court will assign a trustee to oversee your case. Within a few weeks of filing, the trustee will hold a meeting of creditors, which you must attend. The trustee will put you under oath, and will ask you questions regarding your financial situation and property. You will be able to keep your exempt property in your possession, such as your vehicle, house, retirement, social security, and other exempt property. Once the court determines that you have completed the process, it will issue a discharge formally releasing you from your remaining debt obligations.
Common Reasons to File For Chapter 7 Bankruptcy
There are several reasons why someone may decide to file for Chapter 7 bankruptcy relief in Watertown, New York. For the most part, individuals and small businesses feel like they have no other way to regain control of their finances, so they move forward with the Chapter 7 bankruptcy filing process. Below are some of the top reasons that prompt people to pursue a Chapter 7 bankruptcy request.
Struggling with debt is draining and stressful, so many people are desperate to find a way out of this difficult situation. While Chapter 7 bankruptcy is often a last resort for many people, it is designed to help you obtain a fresh start and regain control of your financial future. However, it’s important to note that some types of debt are not dischargeable under Chapter 7, such as child support obligations, student loans and most taxes. For the most part, though, a Chapter 7 discharge can give you the opportunity you need to rebuild your finances.
The Automatic Stay Applies Quickly
As soon as you file your Chapter 7 bankruptcy petition, this motion triggers an “automatic stay” that prevents debt collection agencies from suing you, or contacting you for the payments you owe. Many petitioners find a sense of peace once this automatic stay is in place, allowing them the clarity and space they need to regain composure (without the constant harassment from creditors and collection agencies).
The Process is Fast and Efficient
The timeline for a Chapter 7 bankruptcy case moves fast. Most petitioners can expect to receive a discharge within three months of filing the petition. These cases typically proceed smoothly and efficiently, allowing petitioners to regain control of their financial situations within a relatively short time frame. You can even start taking steps to rebuild your credit right after you file the petition.
Get Started Today
Taking steps to file for Chapter 7 bankruptcy relief can seem intimidating. However, you do not have to go through this process alone. Reach out to a caring and understanding bankruptcy attorney today to discuss your options for enjoying the bright future you deserve.
If you need help exploring your debt relief options in Watertown, New York, call Grady BK, PLLC, today at (315) 299-9005 to speak with a caring and compassionate bankruptcy attorney.