If you’re thinking of filing for personal bankruptcy, the first thing you need to figure out is which type to file. The best thing to do is schedule a free bankruptcy consultation with an experienced bankruptcy lawyer.
There are six different types of bankruptcy. However, there are typically two different types of bankruptcy that apply to most people, and they mean different things for your finances and your future. Depending on your goals, debt limits, and income, Chapter 13 or Chapter 7 may be right for you. Some people who have a lot of unsecured debt or a lot of secured debt have to file a Chapter 11 bankruptcy.
The Chapter 7 means test generally applies to individual filers with primarily consumer debts, subject to exceptions. It compares income with the applicable state median and, when required, considers allowed expenses and certain debt payments. Income above the median does not automatically rule out Chapter 7. The means test is one part of evaluating your bankruptcy options.
Chapter 7 bankruptcy can discharge many debts, but not every debt is dischargeable. You do not have to own very few assets to qualify. What property you may keep depends on applicable exemptions, your equity, and any liens. A trustee may sell nonexempt property to pay creditors.
Chapter 13 bankruptcy is a little different and can accomplish different things. In Chapter 13, debt is consolidated into a payment plan, and the filer is given a set amount of time to pay it back on this plan.
Learn more about the different types of bankruptcy.
In short, different chapters accomplish different goals. The best thing you can do is schedule a free initial consultation and find out your options. To prepare, review our bankruptcy consultation checklist.
Over the past 34 years, the Law Offices of Christopher A. Benson has helped over 2,300 Washington clients take control of their financial situation. We can review whether bankruptcy may help stop your garnishment and address your debts through a repayment plan. Sources: 11 U.S.C. § 362(a)–(d); U.S. Courts: Chapter 13 bankruptcy.
If money has already been garnished, recovery may be possible in some cases, depending on the timing of the transfers, applicable exemptions and other legal requirements. A refund is not automatic or guaranteed. Sources: 11 U.S.C. § 547(b)–(c), (e)–(g); 11 U.S.C. § 522(g)–(i); 11 U.S.C. § 550(a).
But you have to act quickly–call (253) 815-6940 for your free consultation, or email us today. Evening and weekend appointments available.
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