Filing for Chapter 7 Bankruptcy in Montgomery, AL
When financial problems become overwhelming, you do have options. Whether your debt is a result of lost wages, physical ailments, divorce, or just bad luck, you are not alone. When you receive threatening phone calls from creditors you are faced with the fear of foreclosures or vehicle repossessions. However, you can obtain the fresh start that you need through bankruptcy.
At the Montgomery offices of the Dansby Law Firm, we help clients who are struggling with the unpleasant realities of unpaid medical bills, mounting credit card debt, and other financial obligations. Our years of experience helping individuals and families through the Chapter 7 bankruptcy process make us the right choice to guide you through this difficult time.
Stigma Against Chapter 7 Bankruptcy
There was once a stigma attached to filing for bankruptcy, but this has largely disappeared. The fact is that it only takes one unexpected illness, job layoff, or divorce to throw a home into troubled financial waters. If you find yourself picking and choosing which bills are paid each month or struggling to make ends meet, there’s a good chance that this process could help resolve your financial hardships.
Chapter 7 is referred to as a “fresh start” for good reason. Under this procedure your eligible debts are completely discharged, meaning you will not have to repay them in the future. Unfortunately, not everyone qualifies for this type Chapter 7, which is why it is best to enlist the services of an experienced Alabama attorney to evaluate and prepare your case.
Each state uses what is called a “means test” to qualify applicants. Usually this test looks to see if your annual income is lower than the median income for the state of Alabama. However, in many cases, even someone with a high income can qualify based on deductions and other special circumstances. Your attorney will help evaluate both your income and daily living expenses.
Choosing Between Chapter 7 and Chapter 13
One of the most important questions that you need to answer before you file for bankruptcy is whether Chapter 7 bankruptcy or Chapter 13 debt consolidation is the best choice for you. Chapter 7 is often referred to as “straight” bankruptcy because most of your debts will be wiped out in just a few months time. On the other hand, Chapter 13 simply re-arranges your debt to make payments more affordable and stretches those payments out over three to five years before final discharge.
In short, many people opt for Chapter 7 bankruptcy if they qualify. The reason is that a three to five-year commitment of making payments to the court is a lot to handle for some. The only downside here is that the court fees are paid in advance, which makes sense because the case is concluded quickly.
What You Can and Can’t Claim in a Chapter 7 Bankruptcy
If you qualify for a Chapter 7 bankruptcy, the various types of debt that you can eliminate include:
- Credit card bills
- Medical bills
- Back rent
- Unsecured loans
- Some court judgments
- Utility bills
- Income taxes more than three years old
- Loans from friends and family
- Legal and accounting bills
- Magazine and newspaper subscriptions
Despite being a fresh start, there are some debts that you simply can’t break free from through a Chapter 7 bankruptcy. These include:
- Student loans
- Outstanding child support or alimony
- Court-ordered debt due to a violation of the law
If you have assets, such as a home or car, that you wish to protect during bankruptcy, it’s best that you speak to one of our experienced attorneys about your options. As a general rule, you should be able to keep your home, your primary means of transportation, and normal personal property in a Chapter 7 bankruptcy.
The Steps for a Chapter 7 Bankruptcy Filing in Alabama
Alabama’s bankruptcy process can be complicated, which is one of the reasons we recommend using the services of a qualified Montgomery attorney. One mistake in the filing could trigger a rejection and additional cost, which is a financial hardship that you don’t need. The steps for a Chapter 7 bankruptcy include:
- Meet with an experienced Alabama bankruptcy attorney to discuss your options.
- Take a credit counseling course from an approved source within 60 days of filing.
- File Chapter 7 petition in bankruptcy court.
- Appear in bankruptcy court with your attorney before the trustee.
- Take debtor education from an approved source before your case can be discharged.
- Receive final discharge paperwork, usually about 60 days after you appear in bankruptcy court.
The Benefits of Filing for Bankruptcy
Going through financial difficulties is never a pleasant experience. Chances are you are sick and tired of the harassing phone calls and letters with escalating threats. Once your bankruptcy petition is filed with the court, all creditors must immediately stop these offensive activities. If they continue to contact you, you can tell them to stop and even refer them to your attorney with questions.
Not only will the phone calls and letters stop once you file for bankruptcy, but you can also halt some other troubling activities. The filing will prevent wage garnishment, protect your property from being repossessed, and temporarily suspend foreclosure while you review your options.
Speak to a Qualified Montgomery Attorney
If you’re struggling under the weight of financial troubles, filing for Chapter 7 bankruptcy could be the solution. The sooner you contact us, the sooner we can begin working on your case and put a stop to any wage garnishment or other aggressive collection tactics that are disrupting your life. We will not only educate you on this process so that you can make informed decisions, but we will also act as your advocate to protect your rights. Contact the experienced Alabama debt relief attorneys at The Dansby Law Firm now at (334) 539-8787 or online to schedule an initial consultation