Fairfax Bankruptcy Lawyer
Scott R. Sexauer provides solid, prompt, and practical counsel for individuals who are considering bankruptcy or are confronted with foreclosure. Your financial situation will be evaluated at the initial meeting to determine if a Chapter 7 or a Chapter 13 bankruptcy is recommended.
Chapter 7 and Chapter 13 bankruptcy
Chapter 7 bankruptcy is for individuals who cannot pay their existing consumer debts. A Chapter 7 bankruptcy discharges unsecured debts such as credit cards, medical bills, and personal loans. Eligibility for Chapter 7 is determined through a means test, which takes into account household income and the number of people in the household. There are also limitations on property a Chapter 7 debtor can retain after the discharge. For example, a Chapter 7 debtor may be able to keep an automobile if the equity in the car is less than $6,000. If the vehicle is subject to a loan, the debtor must show that the monthly payments can be made, together with regular living expenses, out of the debtor’s monthly income. State and Federal law establishes other limitations regarding property a debtor can keep in bankruptcy. Call Scott R. Sexauer for details.
Chapter 13 bankruptcy is designed for individuals with regular income who need time to pay their bills. Debtors who file Chapter 13 generally have more household income than is allowed under Chapter 7, or have too much equity in real estate. A Chapter 13 debtor must develop a payment plan that will last three to five years, which will address monthly payment of current secured debt (mortgage, car payment), past due secured debt, and payment of all or a portion of past due unsecured debt. All payments must be made out of excess household income; that is, the difference between monthly income and normal living expenses (mortgage, utilities, food, insurance, etc.). The payment plan must be approved by the court. Discharge in a Chapter 13 case is not issued until all money owed under the plan is paid to the court.
Solutions to end the stress
A Chapter 7 or Chapter 13 bankruptcy can provide a debtor with a fresh start. Harassing phone calls from bill collectors will end, and garnishments of bank accounts and wages will stop immediately. A bankruptcy filing can stay all action on a foreclosure and give a debtor time to either work with the lender or move to a new home in an orderly manner. A Chapter 13 bankruptcy can let a debtor keep the family home. Call Scott R. Sexauer for a free consultation.