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West Palm Beach Chapter 7 Bankruptcy Attorney
Suffering from the burden of debt problems can cause anyone to consider Chapter 7 bankruptcy to get a fresh start. Our West Palm Beach bankruptcy attorneys offer answers to many questions as it pertains to Chapter 7 bankruptcy every day. The Law Offices of Brian McMahon explore, answer, and discuss the most common questions we hear from clients.
What is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy is very common and offers a way for debtors to regain control of their expenses through federal bankruptcy laws. Under these laws, individuals can keep some assets and property but only a certain amount. Property that exceeds this amount is sold to pay priority debts.
When is Someone Eligible to File a Chapter 7 Bankruptcy?
The best way to determine whether someone is eligible for Chapter 7 is through the law’s Means Test. The test demonstrates that an individual legitimately does not have enough income or means to pay back debts. It varies by state, and the law uses a broad definition of income to go beyond the simple take-home paycheck. For example, a single-person home might need to make less than $5,000 per month in comparison to a four-person household that may need to make less than $8,000 per month.
What Happens After Filing Chapter 7 Bankruptcy?
Once an individual or business files a Chapter 7 bankruptcy, it eliminates or discharges any unsecured debts. The only dischargeable debts are either medical bills, credit card debt, or lines of credit. Chapter 7 doesn’t remove all types of debt, though. For example, student loans, unpaid child support or alimony debts, tax bills, and criminal fines do not fall under Chapter 7 bankruptcy. Those debts are nondischargeable, and one must find other ways to satisfy those debts.
How Long Does the Filing of Chapter 7 Bankruptcy Last?
Whenever someone files a petition for Chapter 7 bankruptcy with the court, it could take anywhere between 3 to 4 months before the court eliminates the debt. Those with many assets that the courts consider as payment for some debts may prolong the process.
Can Someone File for Chapter 7 Bankruptcy and Still Keep Their Property?
The Law Offices of Brian McMahon hears this question frequently. There is good news. Individuals who file for Chapter 7 bankruptcy may keep their property while still receiving additional protection from creditors through the process of exemption. Federal and state laws establish the exemptions. However, bankruptcy law offers exemptions that limit the amount of equity in a primary residence which is what we call the homestead exemption. If the individual’s home equity exceeds the exemption amount, the court may require that they pay some of the debt.
Our example is if someone’s home has a market value of $300,000 and has a mortgage balance of $275,000, they have $25,000 of equity. If the current federal bankruptcy exemptions permit a Homestead exemption of $25,150, then that individual’s home would qualify in a Chapter 7 bankruptcy.
If Someone Files for Chapter 7 bankruptcy, are They Still Able to Keep Their Vehicle?
If an individual files for Chapter 7 bankruptcy, they may not have to give up their vehicle. There are several options that one can address to ensure they keep their vehicle. If they own their vehicle, free from any liens, it is a requirement under the bankruptcy process to claim the value of the vehicle is exempt. Should the individual fail to do so, it can result in the bankruptcy trustee requiring the debtor to sell their vehicle.
If an individual has a loan to secure their vehicle, they can have the ability to ask the bankruptcy court for a Reaffirmation Agreement approval. This allows them to pay off the vehicle loan based on the car’s retail amount at the bankruptcy filing. If the vehicle’s current value is lower than the balance the person owes on the car loan, then filing a Motion to Redeem may be their best course of action.
Do Creditors Stop Harassing Once an Individual Files for Bankruptcy?
Hiring a West Palm Beach bankruptcy attorney can tell creditors to contact them instead. When our attorneys file a bankruptcy petition, it notifies creditors and forbids them from contacting the debtor without receiving permission from the bankruptcy court.
How Long Does Bankruptcy Remain on a Credit Report?
The bankruptcy will show on a credit report for up to ten years after completing a Chapter 7 bankruptcy filing. These agencies must remove the bankruptcy after a certain period of time. However, the event’s impacts will decrease as time goes on and there is positive information to add to the credit report.
Can Chapter 7 Bankruptcy Discharge Student Loans?
Student loan debts are very rarely dischargeable through bankruptcy. Students may be able to receive benefits from educational lenders, such as expanded forbearance. They can even receive deferment and favorable repayment options. However, currently, all education loans follow a debtor until they either pay them off, pass away, or the court forgives the debt under extreme circumstances.
Get Professional Advice from the Law Offices of Brian McMahon’s West Palm Beach Bankruptcy Attorneys Today
Making a decision to consider filing bankruptcy is intimidating. After completion, though, an individual or business has the fresh start they need. The courts can discharge or reorganize debts, and the debtor has the relief of knowing that their finances are back under control.
We strongly advise anyone considering filing bankruptcy to hire one of our top West Palm Beach Chapter 7 bankruptcy attorneys. We can assist with the legal process and give the assurance that everything will work out with us as a teammate. Our attorneys take all claims and matters seriously; we don’t take bankruptcy lightly. All our clients can attest that our services are second to none and our success rates are exceptional. Give us a call now for help filing bankruptcy. No one deserves to suffer the wrath of debt with no way out. Let us do the legwork and take bankruptcy head-on.
Call our office at 561-658-1789 for help filing bankruptcy. We serve West Palm Beach, Port St. Lucie, Boca Raton, and all South Florida.