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Vehicles and Bankruptcy

Vehicles and Bankruptcy

If you are stuck in debt, you should consider filing for personal bankruptcy, which helps clear away your debts. Personal bankruptcy includes two types, Chapter 7 and Chapter 13.

While Chapter 7 means liquidating some of your assets if you have any that exceed the limits on value, Chapter 13 implies repayment of debts from your future income. If you are considering filing for bankruptcy, you must be concerned about what happens to your vehicle through the bankruptcy process. The fate of your car ultimately depends upon the type of bankruptcy filed by you and the equity present in the vehicle.

Can you keep your vehicle after filing for bankruptcy?

To save your vehicle through the bankruptcy process, you need to be aware of several factors that could have a say on it. The car is always regarded as an asset and is of utility value. The trustee and creditors can investigate this aspect to determine how much of their debt will be paid. The vehicle may also be counted under an exemption, thus safeguarding it from repossession if the lender agrees to accept future payments from the debtor. The factors that help to retain the vehicle are varied, and they are as follows:

  • The type of bankruptcy being filed
  • The value or cost of the vehicle
  • The nature of exemptions that are applied to a place where one lives

What happens to your vehicle in a Chapter 7 bankruptcy?

In chapter 7 bankruptcy car creditors often pressure a debtor to sign a new contract wherein the debtor will be personally liable should future payments fall delinquent. Creditors often threaten to take the car even while the debtor is current on the payments. This creates a dilemma for debtors who wish to maintain possession of their vehicles, especially when they need the car for work transportation.

What happens to your car in Chapter 13 bankruptcy?

Chapter 13 bankruptcy is somewhat different from Chapter 7. It does not liquidate non-exempt assets for repayment to creditors. You will instead enter a debt repayment plan. Your property may be protected from repossession by way of Chapter 13 bankruptcy. A reorganization case will ensure that your finances are reorganized to enable you to begin the process of repayment. If you own a vehicle outright, you will be able to retain or keep it.

If you would like more information about how bankruptcy can help you, contact an Elk Grove bankruptcy attorney.

Marriage and Bankruptcy

Marriage and Bankruptcy

Financial problems are often a source of contention in marriages, especially if large debts are burdening the family. If you and your spouse are experiencing overwhelming debt, you may consider filing for bankruptcy to get rid of the debt. However, timing is important. If you are yet to marry, it is essential to figure out whether you should file for bankruptcy before or after the marriage in such situations. The answer to that question lies in you and your partner's financial situation.

How can bankruptcy help to get rid of my debt?

Bankruptcy is a court-ordered procedure where you can eliminate a portion or all of your debt. Once you file for it, you can hope to get creditors off your back. While filing for bankruptcy could be very beneficial for your debts, you need to figure out the best time to file for it.

When should you file for bankruptcy before marriage?

In circumstances where you have burgeoning debt, but your partner does not, you should consider filing for the bankruptcy before the marriage. This will help to minimize the damage to your spouse's finances and credit health.

If you are considering filing for a Chapter 7 bankruptcy, you should consider doing so before the marriage. If you file after the marriage, then the court could consider your spouse’s income in addition to yours, and it might push you above the maximum limit allowed to file for Chapter 7. Conversely, if your soon to be spouse has no income, filing after marriage might actually help you qualify.

When should you file for bankruptcy after marriage?

In situations where you and your spouse both have huge debts, then you should file for bankruptcy after marriage. If you do so, you can save on many court fees as you would need to file only one combined case. It will also help you to save time.

If you would like more information about bankruptcy, contact a Roseville bankruptcy attorney.

Medical Debt and Bankruptcy

Medical Debt and Bankruptcy

Two of the most common types of debt include secured and unsecured. Secured debts, like car and home loans, are tied to collateral that can be repossessed if you fail to make a payment. Unsecured debts, like credit cards and payday loans, are not tied to collateral or assets; making them much easier to resolve in bankruptcy. Thankfully, medical debts fall into the unsecured debt category.

Is medical debt dischargeable through bankruptcy?

Yes, it is. If you file for a Chapter 7 bankruptcy, the medical debt is probably completely dischargeable no matter what the amount is. If bankruptcy leads to discharge, one is not bound by an obligation to pay back any of the medical bills incurred and not paid for by the insurance coverage. The specific debt must be listed when filing a bankruptcy petition. In Chapter 13, the medical debt will be lumped in with the rest of one's unsecured debt, and creditors will receive a pro-rata portion of one's payments toward unsecured debt in the Chapter 13 plan.

What relief is available to me through bankruptcy?

The Chapter 13 trustee will receive payments over three to five years following a plan confirmation by Chapter 13 bankruptcy filers. The trustee will disburse all payments amongst a debtor’s creditors in the order of priority. The general unsecured creditors will remain at the bottom of the priority list. Per debt relief rules, secured creditors are paid on a monthly basis in order to maintain the collateral of the loan. The healthcare costs or medical debt related to medical care will be in the last category of debts paid. While student loans are regarded as unsecured debts they are usually non-dischargeable through bankruptcy unless the debtor can demonstrate convincingly that he or she has an undue hardship.

There is a vital difference between Chapter 7 and Chapter 13 bankruptcy filers

Chapter 7 filers will receive the maximum discharge of eligible debts but sometimes their assets are sold to satisfy some of the debt. On the other hand, Chapter 13 candidates will repay some of their debts before receiving a discharge, but they are allowed to keep all of their assets without the risk of sale.

If you would like more information about your medical bills or other debt, contact a Citrus Heights bankruptcy attorney to discuss your options.

Money Management and Bankruptcy

Money Management and Bankruptcy

It might seem that there is a direct connection between money management and bankruptcy. Money management skills are not always about being prepared or staying alert about your money. However, the financial burden is often unexpected and more complicated than it appears. Filing for bankruptcy can be a solid plan for debt relief when the financial burden becomes unbearable. 

Bankruptcy as a Method of Money Recover

If you are stuck with a lot of debt, it might not seem that there are good strategies to get out of debt. For many people in those circumstances, bankruptcy may come to the rescue. Bankruptcy law exists as a path to financial freedom.

Chapter 7 or Chapter 13 Bankruptcy

You can file for personal bankruptcy under Chapter 7 or Chapter 13 and expect to get your unsecured debts resolved. Depending on your circumstances, bankruptcy can eliminate your debt and protect your assets. For example, it is commonly known that preventing foreclosure is not easy. However, you can avoid foreclosure with a Chapter 13 bankruptcy filing.

It would be best if you always aimed to take advantage of the provisions of the bankruptcy code whenever there is a requirement on a burgeoning debt. Bankruptcy should still be considered as a convenient tool in your arsenal of money management techniques. 

If you have unbearable debt and would like more information on how to get a fresh financial start, contact a Sacramento bankruptcy attorney today.

Wage Garnishment and Bankruptcy

Wage Garnishment and Bankruptcy

Wage garnishment is a court-ordered procedure in which the court directs your employer to send a part of your earnings to a person or an organization you owe money to. This process of wage garnishment usually stays until the debt you owe is fully cleared.

Wage garnishment orders are generally exercised on debts like child support payments, taxes, and student loans. It is also applicable to all other obligations that have been ordered by a court to be paid, resulting in a collections lawsuit.

Wage garnishment orders can be made on all such persons who receive personal earnings from their employers. Personal earnings could include wages, commissions, salaries, bonuses, and any income from retirement plans.

How Bankruptcy Stops a Garnishment: The Automatic Stay

A bankruptcy filing can help you stop a garnishment order. When you file for bankruptcy under Chapter 7 or Chapter 13, a bankruptcy court ordered automatic stay comes into effect. In simple terms, this automatic stay will hold all such actions taken against you as part of a garnishment order. The stay will also stop creditors from collecting debts from you. It can also remove all of your underlying debts.

The automatic stay provision of a bankruptcy filing is a very advantageous aid, but it must be used carefully. The automatic stay only lasts for about 30 days or might not be ordered at all if you file for bankruptcy repeatedly.

While filing for bankruptcy to stop a garnishment order, you should take note that the benefits provided by a Chapter 7 filing and a Chapter 13 filing may be different. For example, a Chapter 7 filing will not facilitate an automatic stay on a garnishment order for alimony while a Chapter 13 filing will.

By contacting an Elk Grove bankruptcy attorney, you can stop the wage garnishments and eliminate all of your qualifying debt.