Suffolk County Chapter 7 Bankruptcy
If you are dealing with debt that has you stressed because no matter how hard you try, you simply do not have the resources to pay it, there are options. One such option is filing for bankruptcy. While the media publishes stores of big businesses filing for chapter 11 bankruptcy, there are also options for individuals who need bankruptcy protection. For individuals there are 2 options: chapter 7 or chapter 13 bankruptcy. Chapter 7 bankruptcy is sometimes referred to as "fresh start" bankruptcy. It allows you to wipe out the vast majority of your unsecured debt such as credit card bills, medical bills, old utility bills and personal loans. In fact, depending on the types of debt you have, it is possible that chapter 7 bankruptcy will result in you having no debt. However, during the process the bankruptcy trustee may take some of your assets to pay a portion of the debt you owe your creditors. If you are dealing with overwhelming debt and are considering filing for bankruptcy, it is important to immediately contact an experienced Suffolk County Chapter 7 Bankruptcy Lawyer who understands the complexities of federal bankruptcy laws and who will explain to you the steps in the bankruptcy process.
Qualifying for Chapter 7 Bankruptcy. Federal bankruptcy law, 11 U.S. Code Chapter 7, establishes income criteria as one of the eligibility requirements for filing for chapter 7 bankruptcy. Your income must be equal to or below the median income for New York. The median income standard is adjusted each year. If your income is above New York's median income standard, you may still be permitted to file for chapter 7 bankruptcy. However, you must take a "means test" to establish eligibility. The means test is used to determine if you will be able to pay back a portion of your debt through a chapter 13 bankruptcy filing. If you have a certain amount of income leftover every month after paying creditors, you will fail the means test and will not be able to file chapter 7 bankruptcy. However, you still may be able to file for chapter 13 bankruptcy.
In addition, you are not eligible for chapter 7 bankruptcy protection if any of the following applies:
- You filed for chapter 13 bankruptcy within the previous 6 years
- You attempted to defraud creditors or the bankruptcy court
- You failed to attend creditor counseling
Pre-Bankruptcy Credit Counseling. Before filing for bankruptcy, the law requires that you attend credit counseling. This pre-bankruptcy credit counseling must occur within 6 months prior to filing. The session will include an evaluation of your personal financial situation, a discussion of alternatives to bankruptcy, and a personal budget plan.
Dischargeable Debts. While the goal in filing chapter 7 bankruptcy may be to get rid of all of your debt, not all debt is dischargeable. However, you will likely be able to discharge the majority of your debt, such as credit card debt, store credit card debt, medical bills, past due utility bills, and personal loans.
Non-dischargeable debts. Examples of debts which are not dischargeable include child support, spousal support, student loans, debts not listed on the bankruptcy petition, criminal restitution, and certain taxes.
Secured Debt. During the chapter 7 bankruptcy process secured debt is treated differently from unsecured debt. Secured debts are those that are backed by collateral such as a car loan or a mortgage. If you file for bankruptcy, you must decide whether you want to give the property back, redeem it, or agree that you still owe the debt after your bankruptcy case is over.
If you are having a hard time keeping up with payments to your creditors, chapter 7 bankruptcy may be an option to consider. Other debt relief options may include filing for chapter 13 bankruptcy, debt consolidation or negotiating a debt settlement. The staff at Stephen Bilkis & Associates, PLLC has extensive experience helping clients eliminate secured and unsecured debt, responding to creditors' claims, filing for chapter 7 and chapter 13 bankruptcy, avoiding foreclosure and dealing with out issues related to debt relief. Contact us at 800.696.9529 to schedule a free, no obligation consultation regarding your debt issues.