Although most people intend to pay their debts, unforeseen circumstances can arise that render people unable to meet their financial obligations. In many cases, however, a debtor may be able to seek relief via bankruptcy. If your financial liabilities exceed your assets and income, it is wise to speak with an attorney to discuss whether filing for bankruptcy is appropriate to address your financial situation. The Dallas Fort Worth bankruptcy lawyers at Powell Law Offices have the skills and experience needed to assess your available options for seeking debt relief and to guide you through the process of filing for bankruptcy.Debts Dischargeable in Bankruptcy
Regardless of whether a person files for Chapter 7 or Chapter 13 bankruptcy, only certain debts that the person owes will be discharged. Generally, consumer debt, such as credit card bills and medical bills, can be discharged through bankruptcy. Debts that are not included in a bankruptcy petition, however, are not dischargeable. Additionally, child support or spousal maintenance, student loans, certain fines and penalties, and certain taxes will not be discharged.Chapter 7 Bankruptcy
When people discuss bankruptcy, they are typically referring to Chapter 7 bankruptcy. The goal of Chapter 7 bankruptcy, which is often called liquidation bankruptcy, is to discharge all eligible debts. There are strict requirements that a person must meet to qualify for Chapter 7 bankruptcy, however, and therefore it is not a viable option for everyone. A bankruptcy attorney in Dallas Fort Worth can further explain the Chapter 7 requirements.
A person who wishes to file for Chapter 7 bankruptcy must first pass a means test. In other words, the debtor must establish that they lack sufficient income or assets to pay the debts that they owe. It is important to note that even if a person passes the means test, debts cannot be discharged via a Chapter 7 bankruptcy if the debtor has had debts discharged by a Chapter 13 bankruptcy in the prior two years, or by a Chapter 7 bankruptcy in the prior eight years.
If a person meets all the eligibility requirements and files for Chapter 7 bankruptcy, an automatic stay will be entered, barring any creditors from engaging in debt collection efforts. The person must make a list of all of their non-exempt and exempt property. Any non-exempt property will be liquidated to pay creditors.Chapter 13
If a person does not pass the means test, he or she may choose to file for Chapter 13 bankruptcy with the assistance of a Dallas Fort Worth bankruptcy attorney. Even if a person passes the means test, moreover, he or she may opt to file for Chapter 13 rather than Chapter 7, since Chapter 13 allows you to keep your property. Specifically, Chapter 13 bankruptcy, which is also known as reorganization bankruptcy, allows a person to develop a plan to pay their debts within three to five years. The payments will be submitted to a trustee, who will pay the debts in the order of priority. If the debtor complies with the debt payment plan, any qualifying debts that remain at the end of the applicable period will be discharged. Chapter 13 bankruptcy may be appropriate for you if you do not meet the means test or if you wish to retain your property.Consult an Experienced Dallas Fort Worth Attorney
Debts can quickly go from manageable to unsustainable, leaving debtors feeling helpless. If you are overwhelmed with debts that you cannot pay, you should speak with a bankruptcy lawyer in Dallas Fort Worth about whether you may be able to obtain relief through this process. The skillful bankruptcy attorneys at Powell Law Offices regularly help people who are seeking to regain financial stability by assisting them with filing for bankruptcy. Our offices are located in Grapevine and McKinney, and we represent people throughout Dallas and Tarrant Counties. We can be reached at 972-584-9382 or through our form online to set up a free and confidential appointment to discuss your options.