Do You Need Bankruptcy Protection?
If a lost job, illness, marital separation, or other problem has caused your debt to spiral out of control, Bankruptcy may allow you to:
• Eliminate most or all debts and make a fresh financial start.
• Stop foreclosure on a home or recover a home already foreclosed on.
• Prevent repossession of an automobile, appliances or other personal property.
• Stop the termination of utilities.
Which Bankruptcy Option Is Appropriate For You?
That depends on your income, expenses, property, debts, and on whether you want to keep certain property such as your home or car.
A Chapter 7 Bankruptcy filing allows you to eliminate as much debt as possible and not keep a house or car which is worth less than what you owe on it.
You are allowed to keep certain “exempt” property up to specified values, for example, $1350.00 on jewelry, $ 3,225.00 on a car,. $1,000,000.00 on IRA’s.
The Chapter 7 Bankruptcy takes about 4 months.
Eligibility: If your income is below the Massachusetts Median Income for your household size, you are eligible. If your income is above this figure, a “means test” is applied to determine whether you can file under Chapter 7 or whether a more drawn-out Chapter 13 payment plan is required.
A Chapter 13 filing allows you to avoid foreclosure if you keep current on your payments and pay any arrearage over the life of the Chapter 13 plan. An advantage over Chapter 7 is that some debts can be discharged in Chapter 13 but not in Chapter 7, for example, non-support debts to an ex-spouse. This process takes either 3 or 5 years.
Eligibility: You’re eligible if you have a regular income, unsecured debt of less than $336,900.00, and secured debt of less than $1,000,650.00.
Chapter 7 and Chapter 13 Bankruptcy filings stop foreclosure (limited in Chapter 7), eviction, termination of utilities, collection harassment, and repossession of an automobile, appliances and other personal property.
Filing Bankruptcy in the Boston area cannot help you avoid child support, alimony, back-taxes, student loan debts.