A Chicago Chapter 7 bankruptcy lawyer at the Therman Law Offices can help you start fresh and get back on your feet, giving you the financial freedom to pursue the future you’ve always wanted. Unlike other chapters of bankruptcy, Chapter 7 doesn’t require that you liquidate all of your assets or pay off debt by paying additional money over time in order to discharge it, so you won’t have to worry about losing any property that is necessary for day-to-day life.
Who Can File
Typically, chapter 7 bankruptcy is for individuals or business owners who no longer have sufficient income to pay their debts. To be eligible for a Chapter 7, you must earn below your state’s median income level and pass a means test that shows you cannot repay your debts through an installment plan. A lawyer can help you determine whether you qualify.
How Long it Takes
The entire process will take a minimum of 4 to 6 months, but usually closer to 8 or 12. It can be expedited, but that can cost more. The first step is figuring out whether it’s right for you. You have to be eligible — if you are behind on your mortgage payments, have recently lost your job, or are facing another financial hardship, then bankruptcy may help. To find out if bankruptcy is right for you (and how much it will cost), schedule an appointment with one of our experienced attorneys at Therman Law Offices today!
Can You Keep Your Home
It’s important to know that most types of assets are off-limits for a traditional Chapter 7 bankruptcy, so you may lose your home if you file. Even if you can hang on to your home, there’s no guarantee that it will be available for you later — that decision will depend on how much equity you have in your house. A Chicago Chapter 7 bankruptcy lawyer can help better determine for sure how bankruptcy will affect your home ownership.
When Can You Stop Making Payments
It all depends on your income, expenses, secured debts (i.e., car loans), number of dependents, etc. If you’re having trouble making your payments, it may be worth exploring a repayment plan or deferment program with your creditors. At Therman Law Offices, we can help you decide which option works best for you.
What’s Involved In Filing
The main thing to know about Chapter 7 bankruptcy is that it does not erase any debt, nor does it forgive any debts. Instead, when filing for a Chapter 7 bankruptcy, you are forced to turn over your nonexempt assets to a trustee who sells them off and then distributes them as payments on your debt. The trick here is that there are exemptions that allow certain types of property to be shielded from being taken by creditors — and getting those exemptions can be very valuable if you’re trying to file for Chapter 7 bankruptcy. For example, if someone owes $2 million in credit card debt but owns a home worth $1 million, they could file for both mortgage relief (i.e., avoiding having their home taken away) as well as student loan relief.
The final decision you’ll make when filing for bankruptcy is what debts are dischargeable, meaning which will be erased upon completion of your case. The general rule here is that you want to discharge as many debts as possible — but there are some exceptions. For example, if a creditor can prove that you incurred debt with fraudulent intent (for instance, if you bought an expensive car with money from your secret account), it may remain on your credit report even after filing bankruptcy.
Help Is Available
There are basically two kinds of bankruptcy protection: liquidation or reorganization. If you file for liquidation, your assets will be sold to pay off your creditors. Under reorganization, you can retain control over your assets, but you’ll have to make some tough choices. You’ll either have to get rid of certain debts (like credit card bills) or start paying a portion of your income toward those debts (such as mortgage payments). There’s no one-size-fits-all solution here; instead, each situation is unique. That’s why you should contact a Chicago Chapter 7 bankruptcy lawyer from Therman Law Offices today!