How can these seemingly insurmountable debt problems be eliminated? Consult with a bankruptcy attorney to determine if you are eligible for a chapter 7 bankruptcy to liquidate your debts and obtain a fresh start.
As bankruptcy law has undergone significant changes, a consultation with a bankruptcy attorney is essential. One of the first criteria you and your attorney will discuss is whether or not your ratio of income to debt qualifies you for Chapter 7 bankruptcy protection. In most states, to qualify, the applicant's income must be equal to or less than the state's median income. If the applicant's income is above the median, the court may require a means test to determine eligibility. Prior to filing, you must undergo a credit counseling course after passing this exam. After completing this course, you may file your Chapter 7 bankruptcy paperwork with the court. Once the petition is filed, an automatic stay is placed against all creditors. This results in the cessation of all creditors' attempts at collection or repossession. Along with wage garnishments and litigation, liens and threatened seizures cease as long as the bankruptcy process continues uninterrupted.
A trustee is appointed by the court to oversee the bankruptcy procedure. The trustee is responsible for ensuring that the debtor files the proper documentation and determining whether the sale of the debtor's non-exempt assets will generate sufficient funds to satisfy creditors. There are two types of property in bankruptcy: exempt and nonexempt. In general, the exemption applies to automobiles up to a certain value, personal property, work equipment, apparel, wages, and other miscellaneous items. Due to the fact that these factors can vary, it is essential to counsel an attorney for the facts. Child support, the majority of tax debt, and student loans are examples of debts that cannot be eliminated.
The creditor meeting is an integral part of the procedure; your trustee will schedule this meeting. If a debtor fails to appear at the meeting, the trustee may file a petition with the court to dismiss the case. Failure to provide required income tax returns or failure to submit a current income tax return are additional grounds for dismissal. If the trustee dismisses the case for any reason, all collection activities, liens, and litigation halted by the bankruptcy rules may resume. If everything is done correctly, the case continues to its conclusion, all eligible debts are expunged from the debtor's credit report, and the debtor is given a fresh start, debt-free.""
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