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Lacey Chapter 7 Bankruptcy Lawyers
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Serving all of Thurston County, Washington
Lacey Chapter 7 Bankruptcy Attorneys
(360) 753-5553
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Lacey Chapter 7 bankruptcy lawyers fighting for you!
We are Lacey Chapter 7 bankruptcy attorneys, and we're here to help you and your family learn about your legal rights and options when it comes to qualify for protection under Chapter 7 of the Bankruptcy Code.
Some of the first questions that many of our Lacey Chapter 13 bankruptcy clients ask us are general questions about bankruptcy how someone can qualify.
What exactly is a Washington State Chapter 7 bankruptcy?
How do I know if can I qualify for Chapter 7 bankruptcy protection and relief?
What kinds of protections does a Chapter 7 bankruptcy provide?
If you have questions about whether or not Washington Chapter 7 bankruptcy relief is available to you and your family, we encourage you to call our offices for an initial consultation. One of Lacey Chapter 7 bankruptcy lawyers will be happy to help. Many people are somewhat surprised to learn that they can still qualify for a Chapter 7 bankruptcy.
Our Lacey Chapter 7 bankruptcy attorneys are here to help you separate fact from fiction, and we will start by reviewing your finances, including your income, your debts, and your assets.
Chapter 7 bankruptcy basics.
A Chapter 7 bankruptcy starts with filing documents that include your income, your budget, your property and your debts, along with other financial details. You also have to fill out a “means test” to show that your income isn’t too high for a Chapter 7, requiring that you make payments in a Chapter 13 case. Bankruptcy cases are filed in the federal bankruptcy courts.
Before you file a petition, you should consult with an attorney and provide documentation of things like the value of your home and other property, lawsuits, paystubs, tax returns, bank statements and your debts.
One of our Lacey Chapter 7 bankruptcy attorneys along with our dedicated staff will help you put all this information in the proper form and help you avoid any unpleasant consequences, such as having to turn property over in your bankruptcy. You have to take a short “credit counseling class” before filing your case, which can be done in about two hours for $40 on the internet.
As soon as you file your case, you are protected from your creditors by the “automatic stay”, which imposes penalties on creditors trying to collect a debt. A month after the case is filed, you go to a hearing called a meeting of creditors. A trustee is appointed by the court to hold the hearing and investigate your case.
Creditors rarely show up to these hearings. You testify under oath about the documents and the trustee may want some follow up information, but in most cases you don’t need to go to court or having anything else to do with the trustee. And, no matter what happens, one of our Lacey Chapter 7 bankruptcy lawyers will be with you at every stage of the process.
About two months after you file your case, you get a discharge. Sometimes a case is held open longer so the trustee investigate your case or take over property to pay our creditors but in most cases the case closes right after discharge. You have to take a second class called a “financial responsibility class” to get a discharge. It also takes about two hours and is available on line.
What kinds of debts can you discharge in a Chapter 7?
The point of filing a Chapter 7 bankruptcy is to get a discharge of your debts. The discharge basically cancels the debts you owe to your creditors. It is a court order that prohibits creditors from ever trying to collect from you again.
Common types of debt that is discharged in a Chapter 7 includes credit cards, payday loans, medical bills, old debts to ex-landlords, deficiencies from a car repossession, debts from uninsured accidents (where no drugs or alcohol were involved) and signature loans, to name some examples.
However, some debts you cannot discharge. You cannot discharge student loans in most circumstances. Only when a debtor can prove that paying a student loan would present an undue hardship can a student loan be discharged.
Domestic support obligations, such as child support or spousal maintenance cannot be discharged. If you were ordered to pay some debts in a divorce and your ex-spouse ends up having to pay them, your ex-spouse can take you back to court to make you pay him or her back.
Some back income tax cannot be discharged. However, if the tax is over three years old, the return was filed over two years ago and the tax return was not fraudulent, then the tax can be discharged.
Most fines, such as parking tickets, speeding tickets and criminal fines cannot be discharged.
If you are making payments on a car or a house, you can give the property back and discharge the debt or you can sign a reaffirmation agreement, keep making payments and keep the property. You should discuss whether signing a reaffirmation agreement makes sense with an attorney.
What is a means test in Chapter 7?
A Chapter 7 bankruptcy is available to people who do not have enough income to pay any of their debt. In a Chapter 13, people can repay part of their debt according to a repayment plan. You can obtain a fresh financial start much faster without making payments in a Chapter 7, but you have to go through a means test to show you are not abusing the bankruptcy system by not being in Chapter 13.
The first part of the means test is to determine whether you have to take it at all. If your household income is less than the median, or average, income in Washington, there is no presumption that you are abusing the system and you will probably have a fairly easy time in Chapter 7. The income that is measured for the means test is the income you received in the last six months. Social security is not included in this income.
If your income is above this amount, you may still be able to show that you are not abusing the bankruptcy system by using the means test to show that your expenses are so high, you can’t afford to pay your debts in a Chapter 13. Expenses for some things, such as food, clothes and transportation, are strictly defined by the bankruptcy code.
For other things, such as child support, car and mortgage payments, health insurance and tax repayment, you can deduct your actual expenses. In a Chapter 7, you can keep homes and cars if you keep making the payments but you can only deduct these expenses on a means test if you intend on keeping the property. If make over the median income, you should talk to an attorney about your ability to file a Chapter 7.