If you do not know where to start to file a Chapter 7 bankruptcy, make a call to a Waterloo bankruptcy lawyer.
Filing for bankruptcy is a tough decision for anyone to make, even it if appears to be the only thing left to do. Admitting that we are in over our heads financially is one of the most embarrassing and depressing issues anyone could face. They feel that somehow they failed in life. That is not true. Bankruptcy happens to anyone, and you only have to read the stories on the Internet to know that even celebrities declare bankruptcy.
Perhaps a Chapter 7 filing would suit your situation, but you are not sure. Make an appointment to meet with a Waterloo bankruptcy attorney and go over your financial situation. Typically, the first meeting is free and you will get good, solid advice. From there, you can hire the lawyer and move forward through the maze of the bankruptcy system.
Here is a quick overview of what will happen once you hire a bankruptcy lawyer:
– For a Chapter 7, the lawyer files your petition and statement of financial affairs with the courts
– The papers outline your total debt, your income, expenses and what property you own
– Once the papers are filed, you are granted an automatic stay that stops collections activity
– A trustee is assigned to the case and will identify and sell your assets, paying the proceeds to creditors
– Priority creditors are paid first
– When the process is complete, in about four to six months, the debt is discharged
– Discharged debts may include unsecured personal loans, credit card debt and medical bills
Note: Chapter 7 bankruptcy may not stop all collections if a bankruptcy judge determines there is cause
Declaring bankruptcy is fairly straightforward, but is complex, which is why you need the services of an experienced bankruptcy attorney. This has been the case since the inception of the Bankruptcy Abuse Prevention and Consumer Act in 2005. It made filing harder, and now requires that you pass an income test. In a nutshell, the income test figures out if your salary is below other residents that live in Iowa.
If your income is below the median line, it is likely you may file for Chapter 7 bankruptcy. If your income is above that same line, there is more means testing. Generally speaking, the additional means testing involves subtracting certain expenses from your income such as mortgage payments, car loans, tuition, and taxes. Once that is done, if you have $100 a month to pay for 60 months towards your debt, you may not qualify for Chapter 7. You may still pay up to 25 percent in debt repayments though.