Business & Finance Bankruptcy

The Good and Bad of a Debt Settlement

A vast majority of bankruptcy filers to their good fortune are not subject to the means test since if your when compared to the state median income, their income is lower than that.
You may still be permissible to file chapter 7 bankruptcy even if your income exceeds more than} the state median income if you pass the means test.
You can still eliminate or wipe out credit card debt, medical bills, judgments, stop garnishment and keep your personal property, home, and car as long as their values do not exceed the bankruptcy exemptions you are allowed to take.
However, if your income exceeds more than the stat median income and you fail the means test, you probably may file a chapter 13 bankruptcy for debt settlement.
An approved education course must be completed in personal financial management before your debts gets discharged.
Credit counseling must be received from an approved credit counseling and nonprofit budget agency within 180 days prior to filing bankruptcy.
Exceptions are there in case of an emergency situation and counseling could not be received within five days or in cases where the U.
Bankruptcy Trustee has resolute that the approved agencies are inadequate in providing the required counseling.
Let's take an example of a car loan.
You took a car loan more than the car's worth which technically would mean, that you were under water on car loan, then under the old law you had the option of paying the current value of the car over time in a chapter 13 and clear the balance amount of the loan.
However, under the new law the full amount must be paid of the loan, unless you purchased the car more than 910 days before filing bankruptcy.
Debts incurred because of deceit are not cleared under both old and new law when before the deadline the creditor files an Adversary Proceeding and proves fraud.
A chapter 7 discharge cannot be received if a chapter 7 discharge has been previously received within 8 years of the filing date of the new case.
A chapter 13 discharge cannot be received if a chapter 7 discharge has already been received within 4 years of the filing date of the new case.
Finally, a chapter 13 discharge cannot be received a chapter 13 discharge has been received already within 2 years of the filing date of the new case.
In serial fillings, there are no automatic stays.
If chapters 7 or 13 are filed within 1 year of dismissal of a prior bankruptcy case, then the automatic stay terminates after 30 days.
Exceptions are there for a re-filed case in another chapter after a Chapter 7 case based on the means test is dismissed.
A discharge may be put at risk because of a delinquent child support.
A case stands a ground for dismissal in case of failure to remain current on support claims.
In order to corroborate a chapter 13 plan the debtor must be current on post petitions obligations.
Priority payment of support debts must be provided on the plan.
The debtor may not acquire a release if no such obligations are paid in agreement with the terms of the plan.

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