Bankruptcy Attorney in Alpharetta, GA

Types of Bankruptcy Filings

Before considering filing for bankruptcy, it’s important to learn more about different types of bankruptcy, their advantages and drawbacks as well as how Alpharetta GA bankruptcy lawyers can help.

Chapter 7 Bankruptcy

Filing under Chapter 7 of the bankruptcy code is sometimes known as “straight” or “liquidation” bankruptcy and is generally only available to individuals whose income is below a certain threshold. You also must not have filed for Chapter 7 bankruptcy within the last eight years as well as not filed for Chapter 13 bankruptcy within the last six years in order to be eligible. Finally, most states require you to complete an individual or group credit counseling course prior to filing.

When you file for Chapter 7 bankruptcy, the court will place a temporary stay on your debts, meaning they do not have to be paid while the court completes the process of evaluating your bankruptcy claim. This is beneficial because it will immediately protect you from consequences such as being evicted, having your utilities turned off, or wage garnishment. The court will then take legal possession of your property.

Next, the court will appoint a bankruptcy trustee to your case. Your trustee will familiarize themselves with your financial situation and generally oversee your bankruptcy case. The next step is for the trustee to sell your “non-exempt” property to help repay your creditors. “Non-exempt” property refers to the portion of your personal property that is not protected by your bankruptcy filing. The next step, known as a “creditor meeting”, generally requires you to appear in court and answer questions about your debts.

Generally, the process of filing for Chapter 7 bankruptcy takes between four and six months from the date of your initial filing. At the conclusion of the process, the court will discharge all of your remaining debts except for those that are not dischargeable under the law. Nondischargeable debts generally include things like:

• Court fees
• Child support payments
• Alimony payments
• Certain types of student loans
• Certain types of tax debt

Chapter 13 Bankruptcy

Chapter 13 bankruptcy is sometimes called a “wage earner’s plan.” Once you file for bankruptcy under Chapter 13, you will work closely with your attorney and creditors to develop a repayment plan that lasts between three and five years. During the period of your payment plan, your creditors are forbidden from initiating or continuing efforts to collect your debts. Ending or temporarily halting creditor harassment is a great relief for many individuals.

One reason that many individuals elect to file under Chapter 13 is that it enables you to halt your creditors from foreclosing on your home and to pay your past-due mortgage payments over the life of your installment plan.

Anyone is eligible to file for bankruptcy under Chapter 13 as long as their unsecured debts amount to less than $394,725 and their secured debts amount to less than $1,184,200. These numbers change periodically so you should consult with an experienced bankruptcy attorney in order to understand whether you are eligible to file. Filing for bankruptcy relief under Chapter 13 requires that you complete an individual or group credit counseling session prior to filing.

Chapter 7 vs. Chapter 13 Bankruptcies: Benefits and Drawbacks

Understanding the differences between Chapter 7 and Chapter 13 bankruptcies is vital for making informed decisions.

Chapter 7, often called “liquidation bankruptcy,” allows debtors to eliminate most unsecured debts quickly, typically within three to six months. However, it may require the liquidation of non-exempt assets to pay creditors, which can be a significant drawback for those with valuable non-exempt property.

On the other hand, Chapter 13 bankruptcy (wage earner’s bankruptcy) enables individuals with regular income to develop a plan to repay all or part of their debts over three to five years. The key benefit of Chapter 13 is the ability to save one’s home from foreclosure, restructure secured debts, and potentially reduce payments. Nevertheless, Chapter 13 requires a longer commitment, and the debtor must have a consistent income to make plan payments, which might be challenging over several years.

Both paths offer unique advantages depending on the debtor’s financial situation and objectives. Chapter 7 provides a quick resolution but less control over asset retention, whereas Chapter 13 offers more control and flexibility at the cost of a longer repayment period.

How Can Alpharetta GA Bankruptcy Attorneys Help?

Once you have selected an Alpharetta GA bankruptcy attorney, he or she will help you to complete the Official Bankruptcy Forms that initiate the bankruptcy process. In order to complete these forms you should gather the following information:

• A detailed list of your monthly living expenses, including things such as your mortgage payment, utilities, food, clothing, and medical expenses;
• A list of the creditors to whom you owe debts as well as the amounts owed and the nature of the debts;
• The amount and source of your income, as well as the frequency with which you are paid; and
• A list of all of the property that you own.