What Are the Steps for Filing? A Chapter 7 Bankruptcy Checklist Upon the successful completion of the plan, many remaining unsecured debt balances are discharged. Filing under Chapter 13 might be the more beneficial option for consumers who have a regular source of income, as it involves a court-approved repayment plan that lasts for either three to five years. For debtors who are involved in business, for example, a Chapter 11 filing might be a more favorable option if they want to continue in business since this type of filing might provide them with a way to restructure their obligations. Options and Alternativesįiling for bankruptcy under Chapter 7 is not the only option available to debtors. Eligibility is also dependent on certain other conditions, including the means test and credit counseling. However, only the debts of consumers can be discharged under this chapter. Individuals, partnerships, corporations and limited liability companies might be eligible to file for Chapter 7. Next, look at our reviews online for our services and compare them to other attorneys in the area to decide whether we should be your lawyer. The National Trial Lawyers Associations selected Sam Bone as a Top 40 Lawyer Under. The National Trial Lawyers Associations selected Dani Bone as a Top 100 Lawyer in the Country for 2018. WHO SHOULD YOU HIRE FOR YOUR bankruptcy CASE?įirst, look for attorney's qualifications. In Chapter 7 bankruptcy filings, the discharge usually comes within 60 to 90 days of the date of the initial meeting of creditors. The debtor must also have received credit counseling within the past 180 days or, if not, must show proof that there were not enough approved credit counseling agencies available to do so. If a debtor does not pass the means test, the petition is then converted to a Chapter 13 filing if the debtor approves, or it is dismissed. The test checks if the debtor’s current monthly income over five years is greater than $12,850 or 25 percent of the nonpriority unsecured debt when that amount is at least $7,700. This test seeks to identify any abuses to the use of the Bankruptcy Code. At the end of the process, some remaining unsecured indebtedness is discharged.īefore the trustee accepts a petition, the means test is applied to filers whose income exceeds their state’s median income. In some jurisdictions, however, debtors must use the state exemption package. However, in many cases, debtors do not have non-exempt assets. The law allows states to provide their own list of exemptions, and debtors must choose between the federal and the state exemptions. These can include a main vehicle for transportation to and from work, clothing, home furnishings and appliances, pensions and some benefits. Some of the debtor’s assets are exempt to allow the debtor a clean start. Chapter 7 Bankruptcy Checklist in AlabamaĬhapter 7 bankruptcy involves the liquidation of the debtor’s non-exempt assets and the management of the case by a trustee who sells these assets and uses the proceeds to settle claims that have been properly filed by the creditors.
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