The main purpose of bankruptcy is to get a fresh financial start. However, consumers should do their homework about debt relief because bankruptcy does not benefit everyone. Chapters 7 and 13 are used by consumers, and they have different eligibility requirements. For instance, Chapter 7 filers have to earn below a certain amount of money. Chapter 7 is a liquidation bankruptcy. Therefore, filers must swear they cannot repay the debt. The court assigns a bankruptcy trustee who sells assets to repay debt.
If you need debt relief in St. Louis, ask an attorney which assets are exempt under Chapter 7. The Law Offices of Steven K. Brown invite people to visit their website. They consult with you and recommend a strategy. Indeed, the attorney knows whether bankruptcy is beneficial for you. Some debts are not dischargeable, so filing may not be practical. For example, secured debt, like mortgages and car notes, cannot be discharged. Also, you should check whether creditors are willing to negotiate debts before filing.
Bankruptcy is a good idea for people who have been sued. Creditors with judgments can garnish wages and levy on property. People who file bankruptcy get an automatic stay. This stay means creditors must cease all collection activity. However, certain creditors may file to lift the stay. Debt relief in St. Louis includes Chapter 13, the repayment bankruptcy. In order to file, the consumer must have a regular source of income. The bankruptcy trustee comes up with the monthly payment amount. To do this, they look at the filer’s income, assets and expenses.
Many Chapter 13 filers qualify for cram-downs. This means the debt on the property may be reduced. However, the amount owed must be more than what the property is worth. In addition, the attorney should make sure the client can afford the monthly payment. Indeed, the payment is a large portion of one’s disposable income. And, missing payments can result in a dismissal. There is always a bright side, though. The main benefit of Chapter 13 is that the consumer gets to keep their property. On the downside, bankruptcy stays on the credit report for several years. Discuss the pros and cons with your attorney before deciding to file.