Sep
07

Should I file for Bankruptcy if i am separated or divorcing?

I always ask clients what their marital status is and whether they have joint debts with their spouse says Charlotte Bankruptcy Attorney Victorianne C. Maxwell of Maxwell Law Firm, PLLC.

FILING BANKRUPTCY WHEN YOU ARE SEPARATED

If you are separated you are still legally married and have to disclose this on your bankruptcy petition. What does this mean? You must list that you are married and that your spouse lives in a different household.

DO I HAVE TO FILE WITH MY SPOUSE?

No you do not have to file with your spouse. You can file bankruptcy individually even if you are still living together. The difference in filing married individually vs. married and separated is that you will not need to include your spouse income on the later filin status. However, if you wish to elect to file together both of your incomes must be included on the bankruptcy petition even if you are separated.

WHAT HAPPENS TO JOINT DEBTS WHEN I FILE AND MY ESTRANGED SPOUSE DOES NOT

Depends on the Chapter of you file. If you file a chapter 7 bankruptcy, then you will receive a discharge on unsecure debts and those you have chosen not to affirm. What this means is that your spouse will remain liable and you will be discharged of liability. Filing a chapter 13 bankruptcy is a little more tricky. Since a payment plan is set up in a Chapter 13 case, the creditor must accept the payment provided by one spouse for that debt if their debt is secured and modified by the plan. But if the debt is unsecured the creditor can seek full or partial payment from the other spouse.

WHAT YOU SHOULD DO IF YOU ARE CONSIDERING BANKRUPTCY

Divorce itself can be quite a long and arduous process. Many times a lot of divorce squabbles stem from property and debt. Consulting with a qualified bankruptcy attorney can save you time and effort on fighting over who should pay for what. In the end creditor does not discriminate and can go after on or both of you for those debts. In some instances it may be beneficial to file jointly in others it may not be, but you will not know unless you consult with a Bankruptcy Attorney.

 

Maxwell Law Firm represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, Tax Services and loan modifications. You may schedule your appointment by calling 704-780-1100 or save 25% off the fees and schedule online at http://maxwelllegal.com/consultations

Sep
07

How does Chapter 13 Bankruptcy work?

Chapter 13 Bankruptcy is often referred to as the wage earner’s bankruptcy. Generally, people with incomes above the median can qualify for a chapter 13 in certain circumstances.

How Chapter 13 Works

A payment plan is developed by your Bankruptcy Attorney and approved by the Bankruptcy Trustee to pay off your creditors within three to five years time. Instead of certain debts being discharged at the close of your bankruptcy, as in chapter 7, only some the debts will be discharged at the end of the plan. Also, the debtor must make monthly plan payments to the trustee for certain debts. Failure to make these payments could lead to the dismissal of the debtors case. If a debtors case gets dismissed before the conclusion of their plan then they will not receive a discharge

Qualifying for Chapter 13 Bankruptcy

One factor for qualifying, is if a debtor fails the means test for Chapter 7, the will more than likely qualify for a Chapter 13. In addition, if the debtor has non-exempt property that would have been liquidated in Chapter 7, it may be in there best interest to file for chapter 13 Bankruptcy.

Benefits of filing a Chapter 13

1.Creditors will be forced to abide by the payments setup by your Attorney and approved by the Trustee.

2.You have the opportunity to modify the terms of your loans and interest.

3. You can reduce the amount of debt to value of the property. This is called lien stripping.

Chapter 13 is a lot more in depth process taking anywhere from three to five years. You want to make sure your Bankruptcy Attorney informs you of entire process and what you must do to insure that the bankruptcy will be completed

Maxwell Law Firm represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, Tax Services and loan modifications. You may schedule your appointment by calling 704-780-1100 or save 25% off the fees and schedule online at http://maxwelllegal.com/consultations

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