This inability is resulted from unexpected and dramatically changes in the financial situation of debtors. Such changes may be provided by divorce, loss of a job, or many other similar unpleasant and undesirable situations. Nowadays, more and more people are wondering how to file bankruptcy. There has to be paid attention to the fact that the answers can be received from bankruptcy attorneys, after the debtor is going through counseling sessions with them in determining whether filing for bankruptcy is the right choice for the financial situation he/she is experiencing.

An important aspect which has to be taken into consideration is being represented by the fact that anyone seeking legal advice on how to file bankruptcy, after making sure that there are no other better alternatives to be taken. Also, there has to be kept in mind that how to file bankruptcy s an important decision to be taken, as it may remain on the debtor’s credit file for seven to ten years. Lawyers can best explain debtors how to file bankruptcy, as legal advice in this mater is definitely being recommended for anyone who wants to get out of debts in the most advantageous way.

There has to be paid attention to the fact that there are practically two poplar types of bankruptcy, represented by Chapter 7 bankruptcy and Chapter 13 bankruptcy. It is important as well to be considered that learning how to file bankruptcy under Chapter 7 or Chapter 13 can best be learned by seeking the services of a reputable and reliable lawyer.

Foreclosure is the legal procedure in which the government takes ownership of a certain property. If you don’t pay the mortgage in time the company that give you the house loan can take your house and sell it order to recover their money.

Chapter 13 gives the individuals several advantages over bankruptcy under chapter 7.Maybe the most powerful advantage of chapter 13 is the opportunity to save your home or properties from foreclosure. By filling for chapter 13 people you can stop the foreclosure procedures and may solve the delinquent mortgage payments in time.

But don’t be confused. It doesn’t mean you will keep your house and you don’t have to pay anymore. You still have to pay all mortgages but you will do this according to a pay plan approved and supervised by a bankruptcy court.

When you fill for chapter 13 the bankruptcy court will issue a Automatic Stay order. After this you may pay the mortgages and keep up with the original plan until your chapter 13 payment plan will be approved. After that you will pay monthly according to this plan.
Attention: you may still loose the home if the mortgage company finishes the procedures before the Automatic Stay order.

Therefore, this practically means that, in concordance to Chapter 13 bankruptcy definition, the debtor must pledge his/her disposal net income for the period during which he/she will be making payments. This can be done after he/she subtracts reasonable expenses. As result, the balance of what he/she owes on most debts is being erased, by the end of the three-to five-year period.

An important aspect which has to be taken into consideration is being represented by the fact that Chapter 13 bankruptcy is mostly being preferred by debtors who are owning assets they are not willing to loose. Also, there has to be kept in mind that, if you have a regular income and limited debt, Chapter 13 bankruptcy allows you to keep property that you otherwise might lose, such as a mortgaged house or car. It seems that Chapter 13 bankruptcy definition is fitting the interests of more and more debtors nowadays, as the number of appliances for Chapter 13 bankruptcy has grown considerably throughout the last few years.

There has to be paid attention to the fact that more and more people believe that Chapter 13 bankruptcy definition suits their interest better than Chapter 7 bankruptcy. And this is obvious since, unlike Chapter 7 bankruptcy and according to Chapter 13 bankruptcy definition, people can benefit from a court approved repayment plan allowing them to ay off a default during a period of 3 to 5 years, rather than surrender any property.

In 2005 the US Congress passed a new bankruptcy law. This new law stated that you need to participate in credit counseling before you can file. The credit counseling must be completed with an agency approved by the United States Trustee’s office.These counseling meeting have to determine if you really need to apply for bankruptcy or if there are better alternatives for you.

These courses are mandatory and are the first step in the bankruptcy process.Once your bankruptcy case is over, you will have to participate in another counseling class on learning personal financial management skills to complete your bankruptcy and erase your debts.

Anther dramatic changed affected many people and is about the eligibility for chapter 7 bankruptcy. Under the old law was easy for many debtors to file for Chapter 7 but now this thing changed and may people with higher income are not allowed to do this. Instead they are redirected o Chapter 13 bankruptcy.

In order to check your eligibility you need to compare your currently income with the state median income for a family of your size. This is also called the chapter 7 bankruptcy means test. If your income is equal to or less than the median, you can file for Chapter 7.If not you need to continue taking the means test.

We will continue with the:” How to File Chapter 7 Bankruptcy without a bankruptcy Lawyer part 2” tomorrow.

Professional assistance in filing a Chapter 11 bankruptcy is definitely required as such a case can be very complicated and impossible to manage on your own. There has to be paid attention to the fact that, within business bankruptcy laws, Chapter 7 bankruptcy is as well a popular option to be taken by bankrupt businesses. But filing a Chapter 7 bankruptcy will result in the company stopping all operations and going completely out of business.

An important aspect which has to be taken into consideration is being represented by the fact that business bankruptcy laws are best being known by professional lawyer. Therefore, this practically means that anyone looking for business bankruptcy laws to fit the situation in which their company is struggling, should definitely opt for the services of a reputable and reliable lawyer. There has to be aid attention the fact that not all debts can be discharged under business bankruptcy laws.

That is why it is advisable to go through counseling sessions with professional lawyers who can orientate you towards the suitable business bankruptcy laws. Even more, business bankruptcy laws may or may not represent your business, depending on your circumstances. It is important as well to be considered that acknowledging some basic information upon the main business bankruptcy laws is the best way to get started taking options.

Asset: Homestead

- Real or personal property you occupy including mobile home, boat, stock cooperative, community apartment, planned development or condo to $50,000 if single and not disabled; $75,000 for families if no other member has a homestead (if only one spouse files, may exempt one-half of amount if home held as community property and all of amount if home held as tenants in common), $125,000 if 65 or older, or physically or mentally disabled; $100,000 if 55 or older, single and earn under $15,000 or married and earn under $20,000 and creditors seek to force the sale of your home; sale proceeds exempt for 6 months after received (husband and wife may not double).The law section
are 704.710,704.720,704.730

Asset: personal property

- Appliances, furnishings, clothing and food needed. The law section is 704.020
- Bank deposits from Social Security Administration to $2000 ($3000 for husband and wife) . The law section is 704.080
- Building materials to $2000 to repair or improve home (husband and wife may not double) . The law section is 704.030
- Burial plot. The law section is 704.200
- Health aids. The law section is 704.050
- Jewelry, heirlooms and art to $5000 total (husband and wife may not double) . The law section is 704.040
- Motor vehicles to $1900, or $1900 in auto insurance if vehicle(s), lost, damaged or destroyed (husband and wife may not double) . The law section is 704.010
- Personal injury and wrongful death causes of action. The law section is 704.140 (a),704.150 (a)
- Personal injury and wrongful death recoveries needed for support; if receiving installments, at least 75%. The law section is 704.140(b), (c), (d),704.150 (b), (c)
- May file homestead declaration. The law section is 704.920

Asset: Insurance

- Disability or health benefit. The law section is 704.130
- Fidelity bonds. The law section is Labor 404
- Fraternal unemployment benefits. The law section is 704.120
- Homeowner’s insurance proceeds for 6 months after received, to homestead exemption amount. The law section is 704.720 (b)
- Life Insurance proceeds if clause prohibits proceeds from being used to pay beneficiary’s creditors. The law section is Ins. 10132, Ins. 10170,Ins. 10171
- Matured life insurance benefits needed for support. The law section is 704.100 (c).
- Unmatured life insurance policy loan value to $8,000 (husband and wife may double. The law section is 704.100 (b).

Asset: MISC

- Business or professional licenses. The law section is 695.060
Inmates’ trust fund to $1000 (husband and wife may not double). The law section is 704.090
- Property of business partnership. The law section is Corp. 15025

Asset: Pensions

- County employees.The law section is Gov’t 31452
- County firefighters. The law section is Gov’t 32210
- County peace officer. The law section is Gov’t 31913
- Private retirement benefits, including IRAs and Keoghs. The law section is 704.115
- Public employees. The law section is Gov’t 21201
- Public retirement benefits. The law section is 704.110

Assets: public benefits.

- Aid to blind, aged, disabled, AFDCThe law section is 704.170
- Financial aid to students. The law section is 704.190
- Relocation benefits. The law section is 704.180
- Unemployment benefits. The law section is 704.120
-Union benefits due to labor dispute. The law section is 704.120(b)(5)
-Workers’ compensation. The law section is 704.160

Assets: tools of trade

- Tools, implements, materials, instruments, uniforms, books, furnishings, equipment, vessel, motor vehicle to $5,000 total; to $10,000 total if used by both spouses in same occupation (cannot claim motor vehicle under tools of trade exemption if claimed under motor vehicle exemption). The law section is 704.060.

Assets: wages

Minimum 75% of wages. The law section is 704.070.
Public employees vacation credits; if receiving installments, at least 75%. The law section is 704.113.

Even more, a valid lien that has not been avoided in the bankruptcy case will remain after the bankruptcy case¸ although a debtor is not personally liable for discharged debts. In order to recover the property secured by the lien, the lien may be enforced by a secured creditor.

An important aspect which has to be taken into consideration is being represented by the fact that, depending on the chapter under which the case is filed, the timing of the bankruptcy discharge varies. Also, there has to be kept in mind that, on expiration of the time fixed for filing a complaint objecting to discharge and the time fixed for filing a motion to dismiss the case for substantial abuse, the court usually grants the bankruptcy discharge promptly, in a Chapter 7 case. When it comes to Chapter 13 bankruptcy, the court generally grants the discharge as soon as practicable after the debtor completes all payments under the plan.

The bankruptcy discharge typically occurs about four years after the date of filing, since a Chapter 13 plan may provide for payments to be made over three to five years. It is important as well to be considered that, if the debtor fails to complete “an instructional course concerning financial management”, the court may deny an individual debtor’s bankruptcy discharge in Chapter 7 or 13 cases.

Many of you have the impressions that you need to be penniless to apply for Chapter 7.This is false. You can make a consistent amount of money every month and have debts that cannot be paid. This is where the Means test appears.

The chapter 7 means test was designed to limit the use of Chapter 7 bankruptcy to those who truly can’t pay their debts. The principle is simple: You calculate the disposable income by deducting the monthly expensed from your monthly income. Then you compare the disposable income with the median income per family on your state (of course for the same number of members).If you disposable income is lower than the state median you qualify for a chapter 7 bankruptcy.

If not you will be redirect to Chapter 13 bankruptcy which require paying your debts under payback plan.

In conclusion: Yes your income can be important factor when you want to fill for Chapter 7 but is not the decisive factor. A person who make 4000$ in New York may qualify for Chapter 7 while another person that makes 3000$ in Alabama may not. In the end the disposable income is the thing that matter mostly.

Chapter 7: in this case there is no payment involved (Others than the bankruptcy fees).
Chapter 13: you have to pay a certain % from your income according to payment plan developed by you and approved by the trustee and court. If you fail to make a single payment your case may be dismissed.

Debts

Chapter 7: all your unsecured debts are wipeout. You still have to pay in full debts like tax debts, child support or alimony.
Chapter 13: When you make the payment plan you have to make sure that the administrative claims and priority debts will be paid 100%.Also the secure debts must be fully paid if you want to keep your property. Unsecured debts will be paid anywhere from 0% to 100% of what you owe with the money left after you paid rest of the debts.

Discharge

Chapter 7: all your unsecured debts will be wipeout
Chapter 13: a part of your secure debts may be discharge. You will know exactly what will be discharged after you made the payment plan.

Timeline

Chapter 7: It takes between 4 and 6 months
Chapter 13: It takes between 3 to 5 years, depending of the monthly amount you can pay

Properties

Chapter 7: You will loose all of the non exempt properties. The trustee will sell these properties in order to partially pay your creditors. Consult the federal and state exempt list to see what you can keep.
Chapter 13: As long as you stick with the payment plan you will keep your properties. Make sure that the mortgages and car loans are paid 100% in your plan if you want this to happen.

Also you need to announce the trustee of your getting less or more money. He can adjust the monthly payments according to your income. The trustee may approve the additional credit for a decent car (200 to 250 per month rate) but when you talk to the trustee, you will have to present a new accounting of your income and expenses. The bankruptcy trustee will challenge anything excessive so prepare your facts carefully.

If you earning some extra income and presents the situation correctly to the trustee you will be allowed to finance a new car. But the hardest part may be the actual finding a car that you can finance. Even if this is time consuming process you will find a dealer that is willing to give you a car (maybe with a bigger interest).

Again , this car will satisfy your basic transportation needs; don’t even think to something more than basic because the trustee will reject this option from the start.

As you can see, even if you are in a difficult situation like chapter 13 bankruptcy you can manage to get a car. As a final advice: stay away from second hand cars. These machines can consume a lot of money with repairs and maintenance.