Who Should File Chapter 7?
Posted on
June 1, 2009
at
3:15 am
I heard that it is not possible to file Chapter 7 anymore? Is that true?
Posted on
June 1, 2009
at
3:32 am
It is true that not everybody can file Chapter 7 anymore.Under the new Bankruptcy rule, you can file bankruptcy if your current monthly income is less than or equal to the median income for your family size (in your state).If your income is more than the median, you would have to pass the means test.The purpose of the means test is to determine if you have enough disposable income(after subtracting allowable expenses and required debt payment) to repay a portion of your unsecured debts (ex. credit card) in five years.
Posted on
June 1, 2009
at
3:48 am
If your income exceeds your state's median--you have to determine if there is going to be enough left after paying the allowed monthly expenses (this differs per state, so check your state rules), generally the allowable expenses are basic necessities, house, and transportation. There are online calculators available like this, and it is arranged per state:http://www.legalconsumer.com/bankruptcy/nolo/What you come up with there, if ever you pass the test, you can use in your Bankruptcy Official Form 22A
Posted on
June 1, 2009
at
3:54 am
Remember though that just because you pass the means test-- you should file Chapter 7, it only means that you are eligible. You might want to consider other debt relief options first before filing bankruptcy. If the new bankruptcy law sounds complicated and requires a lot of work, it is because it was intentional on the government's side, they really discourage the consumers from filing bankruptcy but would rather the consumer explore other options like credit counseling or debt settlement.You may want to try filing out the form above this thread for free consultation on how to best solve your financial situation.
Posted on
July 7, 2009
at
7:21 am
If you are wondering who should file Chapter 7 and who should not- it really depends on the person's circumstances. For example, how much debt is it that the person owes? How much can the person pay towards their debts each month? Is the person behind on their monthly payments? And of course, one should always ask, is the debt that is causing problems secured debt or unsecured debt? Who should file Chapter 7 is a relatively complex question to address, as specific financial details must be known first in order to determine if filing is the best approach.
Posted on
July 8, 2009
at
3:45 am
thank you steven. i was able to receive some input on that. i actually am contemplating on filing for bankruptcy but your questions made me rethink my decision. i am currently behind (what an oxymoron) on a lot of unsecured debts because of credit cards. my wife passed away fairly recently and we have had a significant amount of payables in medical expenses. right now an $86,000 debt is on top of my head. i wonder if i can still settle that or resort to other measures.thank you for taking the time to address my concern
Posted on
July 8, 2009
at
4:54 am
Peter, I am sorry to hear about you situation, and my condolences to your family. If I may ask, is that debt amount only with the unsecured debts you have, or are secured debts (such as mortgage, a second mortgage, or a car note) included in that also? I ask because secured debts cannot be consolidated. However if the $86k is solely on unsecured debt, I suggest that yes, you can settle that debt. That amount can decreased significantly if you choose that option. Around 40-60% of the entire loan balance will be required of you to pay back.
Posted on
July 8, 2009
at
5:59 am
Well a big chunk of that is secured. I would say around $15-18 would be for unsecured debt.
Posted on
July 10, 2009
at
2:14 am
You need to touch on the secured debts first, because they are evidently priority debts. You may be up for foreclosure or repossession if you aren't able to take care of these. Meaning you may lose your home or car. Try to speak with your creditor so that you can talking about some sort of payment plan. With that debt amount on unsecured debt, I can suggest that you settle your debt. It'll take a year or so before your debt would be paid off, and you'll only pay 40-60% of the loan amount.
Posted on
July 10, 2009
at
4:18 am
I have been reading thru the forums here, they said that you can settle if you're not qualified for Chapter 7 or if you don't file for Bkrupcy. So I guess that's what I'll do, for the meantime. My question is, how much should I pay a debt settlement company if I do decide to settle?
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