Bankruptcy is a scary word. For many people, the idea of ling bankruptcy is simply not an option or one that they don’t believe is right for them. Unfortunately, this is not always the right attitude. In fact, there can be many benets to ling bankruptcy and oftentimes it is preferable to avoiding creditors, paying outrageous interest, and spending a lifetime worrying about your credit. Understanding bankruptcy is key to deciding if it is the right choice for you and your family. Our attorneys can help guide you through this process and will protect your rights every step of the way.
A Chapter 7 Bankruptcy is otherwise known as a “liquidation” or a “straight bankruptcy.” It allows individuals and entities to discharge a majority, if not all, of their unsecured debt, which includes debts such as credit cards, medical bills, and personal loans. Certain debts cannot be discharged through the bankruptcy process such as certain taxes, domestic support obligations, and most student loans.
Bankruptcy is a complicated process that entails certain steps that must be taken in order to receive a discharge of your debt. Experienced bankruptcy attorneys can guide you through this process in a way that is easy to understand. I have outlined the process below.
It can be dicult for the average person to decipher Montana’s Chapter 7 Bankruptcy laws. If you have questions and need help with your Chapter 7 bankruptcy ling, it can be extremely benecial to speak to an experienced Billings bankruptcy lawyer as soon as possible. Your billings bankruptcy lawyer will ensure your rights and your future are properly protected during your bankruptcy ling, thereby giving you peace of mind. Don’t delay – speak to our experienced Billings bankruptcy lawyers today to learn more about Chapter 7 bankruptcy and discover if it is right for you.
Facts About Bankruptcy
Deciding to le for bankruptcy can be a dicult decision, at best. You will carefully weigh the pros and cons of ling for bankruptcy, in order to determine whether a bankruptcy ling is the best thing for your long-term nancial future. If you are like most people, reckless spending is not the cause of your present nancial situation, rather you may have been dealing with astronomical medical expenses, the loss of a job, a divorce, or another nancial hardship.
The demographics of the “typical” bankruptcy ler has changed over the past few years, and today the average ler is married, older, has a high school education and makes less than $30,000 per year. Senior citizens are ling bankruptcy with increasing frequency, likely due to an inability for many to pay for basic existence on Social Security. Gender seems to have little impact on bankruptcy lings, with about the same numbers of men and women ling bankruptcy each year. More than 64 percent of those ling for bankruptcy are married, with about 15 percent of lers either divorced or in the process of divorce.
What is Chapter 7 Bankruptcy?
While there are several types of bankruptcy ling, Chapter 7 is the most common, and, in most ways, the simplest. For those who really need quick nancial help, Chapter 7 Bankruptcy may be a good option, as it typically takes just a few months from start to nish. If you have little income, have few valuable possessions which would not be protected by state exemption laws, and have a signicant amount of unsecured debt (credit cards, personal loans or medical bills), you could be a good candidate for Chapter 7.
What is Chapter 7 Bankruptcy?
If you decide to le for Chapter 7 Bankruptcy in the state of Montana, you can protect some of your assets with Montana’s bankruptcy exemptions, and you may also use applicable federal bankruptcy exemptions. If you are married, ling joint bankruptcy, each spouse is allowed the applicable exemptions, thereby doubling their protections. Below are typical Montana bankruptcy exemptions
- The homestead exemption allows you to protect the equity in your home up to $250,000.
- Life insurance proceeds
- Medical, hospital or surgical care benets
- Group life insurance proceeds
- Annuity contracts (certain conditions apply)
- Up to $2,500 in equity in one vehicle
- Furniture, rearms, clothing, jewelry, sporting goods, crops, feed, animals, appliances or furniture, up to $600 per item, and $4,500 total.
- A pre-purchased burial plot
- Any prescribed health aids, such as hearing aids
- Coop association shares
- Alimony and/or child support
- Pensions and other retirement benets
- Public benets such as public assistance, veteran’s benets, unemployment, crime victim’s compensation and silicosis benets
- Tools of your trade up to a value of $3,000.
You may be able to keep certain secured debts by rearming those debts. To do this, you must sign a voluntary “Rearmation Agreement.” You will still owe the debt, and must continue to pay it just as you were prior to ling for bankruptcy. You are renewing your legal obligation to pay that certain debt you are rearming. You cannot rearm a debt unless you are current on the debt payment. This means if you are several months behind on a debt, but you want to rearm the debt, you must bring it current.
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Steps Of Chapter 7 Bankruptcy
As stated above, bankruptcy is complicated that mandate certain procedures be taken before, during, and after your petition has been ﬁled with the court. The ﬁrst step that should be taken is to consult with an attorney that can analyze your situation and discuss the advantages, disadvantages, and effects of ﬁling for bankruptcy. In order to do so, you must prepare a lot of information in advance which includes your income and all of your liabilities (or at least a ballpark thereof).
After you have consulted with an attorney and have determined that Bankruptcy is in your best interests, your attorney will work with you to get all the necessary documentation needed to prepare your Bankruptcy petition and schedules.
The U.S. Bankruptcy Code mandates that debtors take two classes during the bankruptcy process. The ﬁrst class you must take is the credit counseling course, and this course must be taken before your attorney can ﬁle your petition. The class may be taken online or over the phone, and generally takes approximately two hours to complete. Some course providers allow you to start and stop the course as needed. Once you have completed the course, you will receive a certiﬁcate that needs to be ﬁled with the court. A majority of course providers send the certiﬁcate directly to your attorney, so there is no need to worry about that.
Once your attorney receives your credit counseling certiﬁcate, and has ﬁnalized the petition and schedules, he or she will ﬁle the petition and schedules with bankruptcy court. After it has been ﬁled, the bankruptcy court will generate a Notice of Bankruptcy Case. The Notice of Bankruptcy Case contains the date, time, and address for your Meeting of the Creditors.
The Meeting of the Creditors is a meeting with the trustee and any creditors that choose to attend. You will be sworn in and asked questions regarding the information disclosed on your petition and schedules. Your creditors have the right to attend and ask questions as well
The debtor education course is generally the last step one has to take before receiving a discharge of debt. It is the second course required pursuant to the Bankruptcy Code. Like the credit counseling course, it takes approximately two hours and can be taken online or over the phone. You will also receive a certiﬁcate upon completion. Depending on whether the course provider ﬁles the certiﬁcate with the court, you may have to sign a form regarding your completion of the course