Chapter 7 Bankruptcy
If you are reading this page, then you want answers to help you solve your financial problems. If you are trapped in a cycle of debt and do not know how to get out, do not let intimidation and harassment from creditors stop you from learning how to make a fresh start. The Law Office of Richard J. Lewis deals exclusively with chapter 7 of the bankruptcy statute. Chapter 7 is straight bankruptcy where you file a petition with the bankruptcy court asking to be relieved of the burden of all of your unsecured debts, such as medical bills, credit cards, collection accounts, civil judgments, vehicle repossessions and so on. If these kinds of debts are what you have, then you want to file chapter 7. If you’re plagued by debt, filing chapter 7 bankruptcy may be the most effective way to protect yourself from creditor harassment. As an attorney practicing in Chapter 7 bankruptcy, I am ready to help you file for chapter 7 and make the phone calls stop. I have helped clients rid themselves of debt and can do the same for you.
You file a petition seeking relief in the United States Bankruptcy Court, which is Federal Court. By doing so, you immediately shut down all State Court actions, such as repossessions, foreclosures, wage garnishments and bank levies because the Federal Government is supreme over all fifty states. Along with the petition, you also file a series of schedules that list all your assets, all your debts and detailed budgets of both your income and expenses. You normally get to keep all your assets by using what are called exemptions, which cover things like equity in your home, values for your car, jewelry, clothes, furniture, tools and what is called a wild card exemption that you can apply to any asset that you want. You also answer a series of questions contained in what is called “the statement of financial affairs” or “SOFA” for short, which seeks to find out if you tried to give away assets so your creditors would not get them, if you are in business or if you had foreclosures and so on.
About 35 to 40 days after you file the petition, you will go to a Section 341a hearing, which is called a “creditor’s meeting.” At that hearing, the U.S. Trustee assigned to your case will question you under oath about the documents that you filed with the court. Creditors generally do not appear and usually there are no problems if the case was prepared and presented properly. If you wish to keep cars or RVs, then you can sign what is called a reaffirmation agreement, which basically says that you agree to the terms of the original contract again and want to keep that debt so you can keep the asset. About 90 days after the creditor’s meeting, you will receive a discharge in the mail which is a permanent injunction against all collection activity for any debt that was listed on your petition and schedules that you did not reaffirm. At that point in time, your case is complete and you are no longer subject to the Bankruptcy Court and can move on with your life.
The only big problem these days in getting through a Chapter 7, is what is called “The Means Test.” In 2005, when the big banks convinced Congress to limit the ability of consumers to file Chapter 7, they put in two tests. One is the median income test and the other is the means test. If you exceed the median income for your family size in your region of the country, then you cannot file Chapter 7 unless you pass the Means Test. The Means Test is a nightmare that makes you live on living standards that are not to an average person’s liking. If you fail the Means Test, you have to file a Chapter 13 instead and pay back some or all of your creditors over the next five years.
Beyond guiding you through the Chapter 7 process, I will instruct you as to the best course of action. Chapter 7 isn’t for everyone and there are numerous factors to consider. Some advantages to filing Chapter 7 with me:
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