There are two common types of bankruptcy that debtors generally consider.
In a chapter 7 case, a bankruptcy trustee may liquidate some non-exempt property to pay creditors and most of the consumer debt is discharged.
In a chapter 13 "wage earners" bankruptcy, a debtor's finances are reorganized, their income and expenditures analyzed, and a repayment plan is prepared. The plan must be approved by the court and often provides for a much smaller percentage of the original debt, lasting 3 to 5 years.
We offer a free initial consultation to answer your questions and discuss if bankruptcy is a good option for you.
What about your Home?
You Can Keep Your Primary Residence
If your decision is to try to continue to make payments and and keep your house, Chapter Thirteen (13) can provide a court enforced repayment plan that brings the mortgage current over time. Consider carefully whether it makes sense to keep the house, as often times keeping a house makes no economic sense and this debt may in fact have been a contributing factor leading up to the need to file bankruptcy.
You Can Reaffirm the Debt on Your House and Keep It
If you are not have significantly behind on your house payment and you are filing a chapter 7 and you wish to keep your house you can do so by reaffirming the debt and continuing to make payments. If you decide to enter into a reaffirmation agreement, it must be signed by all the parties and filed in the case.
You Can Surrender the House
Regardless of which Bankruptcy chapter you file, you can return the house to the creditor. Like most other debts, a Chapter Seven (7) will discharge any debt remaining after the foreclosure. In a Chapter Thirteen (13), that part of the debt remaining after the house is foreclosed on is considered a deficiency and treated like other unsecured debt.
Terry D. Bigby, Attorney at Law, 429 S. Muskogee, Tahlequah, OK 74464
918-456-1782 or 800-699-5893
Practices as an Oklahoma Bankruptcy Attorney
Licensed in Tulsa Bankruptcy Court and other Oklahoma Bankruptcy and State Courts
What about your Car?
You Can Keep Your Automobile
Under Oklahoma law, each debtor filing for bankruptcy is entitled to a motor vehicle exemption for a value up to $7500.00. This means that if a married couple, filling jointly, files under Chapter Seven (7), each party is entitled to one vehicle, so long as each vehicle's value does not exceed $7500.00 in equity value.
You Can Reaffirm Your Vehicle Debt and Keep the Vehicle
If you own a vehicle and are current on your payments, the debtor can opt to reaffirm the debt and continue making payments.
You Can Surrender the Vehicle
A debtor can also choose to surrender the vehicle to the creditor. In this case, the debt is discharged in your bankruptcy case and you owe nothing further.
There are a number of myths that advisors must debunk in order to prepare clients properly. See the top bankruptcy myths.
A Successful Bankruptcy Case
There are many issues to consider when filing for bankruptcy - too many for those with little legal experience to manage. In order to ensure that all of your rights and benefits are protected, it requires expert legal help. Our law office can provide the legal and financial assistance required to make this difficult, but often necessary, process successful.
Full disclosure is the rule.
You do not file bankruptcy on a creditor. You file bankruptcy and must disclose to the court all creditors, assets and income etc.
There is a great deal of financial information that a debtor is required to disclose, including:
1.Assets and liabilities
2.Income and expenditures
3.A financial statement
4.Contracts and unexpired leases
5.The most recent tax return
In addition, there are a number of requirements a petitioner must fulfill:
1.Credit counseling by an approved counselor required before a debtor can file for bankruptcy.
2.If filing chapter 7, passing a "means test," showing debtors do not have a greater income than is allowed.
3.If filing chapter 7, filing Schedule C with the bankruptcy petition, listing all property exemptions claimed under appropriate state or federal statutes.
4.If filing chapter 7, determining whether to let property that is security for debts be claimed by lien holders or reaffirm those debts.
5.If filing chapter 13, prioritizing creditors in order to determine who will receive a higher precedence for payment out of the reorganized financial assets.
6.Attending approved debt education or management classes once the bankruptcy petition is complete and before the case is closed.