CHAPTER 7 BANKRUPTCY—WHO CAN’T FILE?
Bankruptcy Attorney in Oak Brook, Illinois
When an illness, accident, or divorce occurs, you become buried in a mountain of debt. You may have to start over financially through bankruptcy. However, is it the best choice for you, and should you file Chapter 7 or Chapter 13? The decision to declare bankruptcy needs to be carefully considered.
However, there is hope for the future. Our Oak Brook bankruptcy attorneys at Cutler & Associates, Ltd. can assist you. We can help you regain your bearings when life takes an unexpected turn.
Why Do I Need an Experienced Bankruptcy Attorney in Oak Brook, Illinois?
People frequently attempt to file for bankruptcy by themselves to avoid paying legal fees. Unfortunately, these people discover the hard way that a do-it-yourself approach to bankruptcy law ultimately ends up costing them far more.
When you work with the bankruptcy team of Cutler & Associates, Ltd., we will:
- Give you the excellent legal advice you need based on our years of experience.
- Ensure to prepare your bankruptcy petition and all supporting paperwork or bankruptcy forms properly.
- Assist you in getting ready for your bankruptcy court appearance.
- Assist you in cooperating with your designated bankruptcy trustee.
- Boost your chances of succeeding in bankruptcy.
- Collaborate with you to create a better life following the bankruptcy.
We think financial setbacks can be a chance to progress toward longer-term financial stability.
What is Bankruptcy?
A legal procedure called bankruptcy allows you to take back control of your finances. Bankruptcy may be the best solution for people or organizations accumulating more debt (and even tax debt) than they can handle.
People who file bankruptcy often employ one of these two strategies:
- Chapter 7 Bankruptcy: This is the most popular and fastest type of bankruptcy for all individual debtors, typically taking approximately 120 to 180 days to accomplish. Filing Chapter 7 bankruptcy enables borrowers and all debtors to pay off the debt by liquidating assets through liquidation bankruptcy, including real estate, to pay creditors. Healthcare debt, credit card debt, and personal loans are qualified for Chapter 7 bankruptcy cases.
- Chapter 13 Bankruptcy: If you don’t qualify for Chapter 7 or have a non-exempt property you want to maintain, Chapter 13 may be the best option. Remember, though, that Chapter 13 bankruptcy requires more time than Chapter 7. Chapter 13 enables you to reorganize debt, such as secured debt, into a manageable three- to five-year repayment schedule. Any outstanding debt is canceled when the plan comes to an end.
It is advisable to speak with an Oak Brook bankruptcy attorney to ensure you are fully aware of your alternatives.
How Can Bankruptcy Help You?
The bankruptcy court system is responsible for regulating the legal process of bankruptcy. It permits qualifying debtors to cancel debts that would be challenging or impossible to repay. The term “bankruptcy discharge” refers to the act of eliminating debt. This implies that you can start over financially if your bankruptcy case is approved.
There are further advantages to declaring bankruptcy, such as the following:
- Once you’ve filed, debt collectors cannot legally contact you;
- You are not subject to lawsuits from secured creditors;
- Utility companies might not be able to stop providing services;
- The foreclosure process may be stopped;
- Evictions may be put on hold;
- Wage garnishments end immediately; and
- You are not liable for any overpayments of public benefits.
All of these advantages result from the automatic stay. That takes effect as soon as your bankruptcy lawyer submits the petition. Although the automatic stay is only brief, this is still considered one of the bankruptcy protections you can take advantage of to buy some extra time.
To find out more, call us right away. We at Cutler & Associates, Ltd. will be pleased to assist you in identifying the best course of action for your case.
Sadly, not all are eligible to file for bankruptcy, especially Chapter 7 bankruptcy. Note that you might start over by submitting a Chapter 7 bankruptcy petition. Typically, people who meet the requirements have few assets to sell and can get most of their unsecured debts discharged from their unsecured creditors. Your legal responsibility to pay creditors will be removed by filing for bankruptcy, which will stop businesses from chasing you for debt repayment.
Although Chapter 7’s main objective is bankruptcy relief for all of your debt obligations, the system is complicated and requires a thorough procedure. Your Chapter 7 bankruptcy petition can be rejected if you have specific circumstances or don’t follow the rules precisely.
Several Reasons Why You Might Not Be Qualified to File for Chapter 7 Bankruptcy
Various factors that might affect your Chapter 7 bankruptcy eligibility. Below are the following reasons that you might not be eligible to file for this bankruptcy type:
- You can make monthly installments
If your income is too high or your responsibilities are too small, the judge can convert your petition to Chapter 13 and order you to repay some of your debts under court supervision, which is the only way to prove you can’t pay the bill.
- Possess non-exempt property
You must provide a list of all your assets and debts when you file for bankruptcy. To find out if you have any possessions that can be used to pay back debt, the bankruptcy trustee subtracts exempt assets. For instance, if you have a car worth $30,000 but owe $10,000, the court trustee may order you to sell the automobile and utilize the $20,000 in equity to pay off your debts.
- Once filed for bankruptcy
The law mandates an eight-year waiting period after your previous Chapter 7 bankruptcy filing if you intend to file again. The law stipulates a six-year waiting period if you’ve already filed for Chapter 13 bankruptcy.
- Committed fraud against creditors
If you sought to defraud your creditors or disguised assets so you might keep them rather than have to sell them to pay your debt, the bankruptcy court might dismiss your case.
The court and trustee are alerted to certain behaviors. The court may decide to dismiss your bankruptcy case if you engaged in any of them in the previous year. You can anticipate the trustee will extensively examine the following actions:
- Selling property to family members or friends for less than its fair market value;
- Accumulating debt to purchase expensive goods while you lacked the means to repay them;
- Hiding assets or cash from a business associate; or
- Lying on a credit application about your income or obligations could result in identity theft.
Additionally, you must certify all information in your bankruptcy documents under penalty of perjury by signing them. The court may dismiss your case or send it for fraud prosecution if it learns that you purposefully failed to declare property, withheld important information about your financial affairs, or used a fraudulent Social Security number to conceal your identity as a previous filer.
- Transferred disqualifying assets
A look-back period has been introduced for asset transfers. A recent asset transfer can be viewed by the bankruptcy trustee as an attempt at fraud, invalidating your petition. Title transfers, such as giving your child a car, are simple to track down.
- Owe obligations that are ineligible for discharge
Your bankruptcy petition will not be denied due to non-dischargeable debt. However, it will prevent you from filing for bankruptcy to pay off all your bills. Student loan debt and marital obligations like alimony and child support are two examples of the 19 types of debt that are not eligible for discharge.
- A judgment proof
Unsecured debt providers’ options for obtaining payment are limited. The most common way is to take legal action, which gives creditors the authority to seize assets or garnish wages. Judgment-proof consumers include individuals without titled assets or those whose income cannot be garnished, such as Social Security income. In other words, a creditor would not be able to obtain the debt even if they filed a lawsuit. Filing for bankruptcy would be less beneficial in this situation.
- Have acquired enough amount of debt
Low debt ceilings reduce the benefits of bankruptcy due to the expense. The total expense of filing for bankruptcy and hiring an attorney may cost $2,000 or more. While Chapter 13 places an approximate cap of $360,475 on unsecured obligations, Chapter 7 has no such restrictions.
- Failure to take all the steps necessary to comply with the bankruptcy
You have a set deadline for submitting documentation and finishing up specified responsibilities when you file for bankruptcy. A dismissal could occur if the necessary papers are not submitted on time.
- Failure to fulfill the financial education obligation imposed by the court
An educational aspect of bankruptcy filing is included. To be eligible for debt relief, you must finish a certified bankruptcy course at the beginning and before the discharge. The petition for your approval can be denied if you don’t finish this class.
It would be worthwhile to consult with a Chapter 7 bankruptcy lawyer in Oak Brook, Illinois. They can teach how a debt settlement program can help you get out of debt faster and avoid living with the stigma of bankruptcy, given the challenges of filing for Chapter 7 or Chapter 13 bankruptcy.
Consult our Seasoned Bankruptcy Attorney Today!
A bankruptcy lawyer in Oak Brook is the only one who truly comprehends the stress caused by accumulating debt. We can reassure you that bankruptcy is not horrible. It is one of the best ways for struggling consumers to clear their enormous obligations and start over.
Our lawyers at Cutler & Associates, Ltd. in Oak Brook and from its several law offices in Schaumburg, Terrace, Skokie, and Aurora, will provide personal, confidential legal counsel from the moment you receive your free case evaluation until your bankruptcy process is complete.
Speak with a Chicago, Illinois, bankruptcy
lawyer from Cutler & Associates today about your debt concerns!
Cutler & Associates, Ltd. can provide the compassionate, confidential counsel and representation that you need in any of these cases. With our help, you could eliminate your debts and start over from scratch.