If you’ve been overwhelmed by debt, wondering how you’re going to pay your bills every month, and worrying about someone taking your car or home away, debt relief could be just what you’ve been looking for. A Centerville Chapter 7 bankruptcy attorney, like the team at Horwitz & Horwitz can help you.
Chapter 7 bankruptcy may be able to give you a fresh start.
At Horwitz & Horwitz, LLC, we understand that this is a difficult, frightening time for you. We’re here to help you understand your options and get through the bankruptcy process with as little anxiety as possible.
We’re dedicated to developing a relationship with our clients. We answer your calls, prepare your case, and attend your court hearings–not a paralegal or secretary. When you work with us, you’ll be working with an experienced Centerville, OH bankruptcy lawyer who will answer all of your questions and give you straightforward advice.
What you need to know about Chapter 7 bankruptcy:
- Chapter 7 bankruptcy generally wipes out many forms of debt, including credit card debts.
- A Chapter 7 bankruptcy case is usually concluded within six months of the initial filing.
- Ohio state law has certain “exemptions” that can protect your possessions from creditors, including bankruptcy court. Depending on the amount of assets you have, you might want to file for Chapter 13 bankruptcy.
- Some debts–called “exclusions”–cannot be erased, including child support, domestic support orders, certain taxes, and some school loans.
- You can voluntarily choose to retain some forms of debt, if you choose, by “reaffirming” the debt. This is generally the approach taken to keep you in your home. Reaffirming on a debt also helps to re-establish your good credit rating.
- You can redeem certain items that you want to keep after the bankruptcy at fair market value, through a process called “redemption.”
Call us today for a free consultation with a knowledgeable, understanding Centerville Chapter 7 bankruptcy attorney. You don’t have to deal with financial troubles alone. We’ll help you get back on your feet.
Chapter 7 Bankruptcy Overview
Bankruptcy is never an easy option; it can be difficult to know whether it is the right choice to file for bankruptcy as well as what type of bankruptcy filing would be best for you and your specific financial situation. Every person’s finances are unique therefore it is essential that you have an experienced Centerville Chapter 7 bankruptcy attorney by your side from start to finish to ensure you make the best choices and do not make any missteps which could cost you down the line. Filing for Chapter 7 bankruptcy is one way to get out from under your debts, regaining control of your finances and your future. Chapter 7 and Chapter 13 bankruptcies are the two types usually filed by individuals rather than businesses, and Chapter 7 is typically the preferred choice, although this is an issue which should be discussed with your Centerville Chapter 7 bankruptcy attorney from the firm of Horwitz & Horwitz.
Do I Qualify for Chapter 7 Bankruptcy?
In order to qualify for Chapter 7 bankruptcy, you must pass the “means test.” This means that your income should be at a level where there is simply not enough money left over after your housing, living expenses and payments on secured debts to make payments to unsecured creditors. The means test will help you determine whether your average monthly income is above or below the median income for a family of your size in the state of Ohio.
As a quick way of determining whether you are eligible to file for Chapter 7 in the state of Ohio, the current median income level in the state for one person is $49,624, for two people, $62,308 and for three people $74,969. As noted, this is a quick way of determining whether you are likely to qualify for Chapter 7 bankruptcy, but it is a bit more complicated than that. Even if you do happen to qualify for Chapter 7 bankruptcy, you might still obtain a better outcome through filing Chapter 13 bankruptcy.
Not All Debts are Dischargeable
There are some debts which cannot be discharged under Chapter 7, including the following:
- Any debt resulting from illegal activity (such as fraud, embezzlement, larceny or breach of trust);
- Any priority debs such as child support or spousal support;
- Student loans;
- Any penalty or fines incurred from a violation of the law;
- Any income tax debt for the past three years;
- Any other tax debt;
- Any debt you failed to list in your bankruptcy filing;
- Any credit card purchase of $1,150 (or more) for luxury goods or services which was made within sixty days of your bankruptcy filing;
- Any cash advance or other type of loan of $1,150 (or more) taken out within sixty days of your bankruptcy filing;
- Any debt resulting from malicious or willful injury to another person or a person’s property
Failing to Follow the Rules Can Have Serious Consequences
One of the primary reasons for speaking to an experienced Centerville Chapter 7 bankruptcy attorney is that any small failure to correctly follow the procedures and court rules could result in the court refusing to discharge your debts. Further, you could incur serious penalties, including jail time and heavy fines for hiding funds or property or lying on your bankruptcy petition—even if the omission was inadvertent.
Special Issues Related to Filing Chapter 7 Bankruptcy in Ohio
If you have filed for Chapter 7 bankruptcy in the past, you may have to wait at least 8 years before you are allowed to file Chapter 7 bankruptcy again. To obtain a Chapter 7 discharge, you must go through a credit counseling agency and complete a debtor’s education course—usually online. The debtor’s education course will review your income and expenses and is a mandatory part of filing for Chapter 7 bankruptcy in Ohio. In some cases, if you want to keep secured property (which is not exempt under Chapter 7 bankruptcy laws), you are able to continue making the payments until the debt is fully paid, and both you and the creditor sign an agreement to that effect which will be filed with the court, reaffirmation could be an option.
In addition to reaffirmation, redemption is sometimes possible. Redemption means the court determines the secured property’s fair market value, then you pay this amount in one lump sum to keep the property. Since most people who are filing Chapter 7 bankruptcy have very little money at their disposal, this is rarely an option. In most cases, you will be allowed to keep your home—particularly if you have little or no equity in the house—as well as most of your personal property in a Chapter 7 bankruptcy.
Keeping Your Ohio Home Following a Chapter 7 Bankruptcy Filing
So long as your net equity in the home does not exceed the exemption—and you are current in your mortgage payments, you should be able to keep your home. Equity in your home is the primary determining factor in whether you will be allowed to keep your home as well as your ability to remain current in your mortgage payments. Ohio law provides an exemption which is significant enough to allow most people to proceed with Chapter 7 bankruptcy, even when there is some equity in the property. The Chapter 7 homestead exemption can protect your home in many cases; because your home is considered a secured debt, you would have to have the means to continue making your monthly mortgage payments and reaffirm the debt.
Chapter 7 Bankruptcy Exemptions Including Wild Card Exemptions in the State of Ohio
You will be able to protect some or all of your property by taking advantage of Ohio’s Chapter 7 bankruptcy exemptions which allow you to protect certain properties from your creditors. Ohio does not allow federal bankruptcy exemptions, rather requires Ohio residents to use the exemptions established by the state. If you are married, and you are filing a joint bankruptcy in the state, you may be able to double the exemption amounts. You are allowed up to $145,425 of equity in one home which you use as a residence.
You are allowed to keep $500 in the bank or in cash, and up to $4,000 value in one vehicle. You may keep $13,400 in value of furnishings and appliances, up to a value of $625 per each item.
You may keep up to $1,700 of value in jewelry, interest in one burial plot, and up to $25,175 value received from a personal injury award you received within 12 months of filing for Chapter 7 bankruptcy.
You may keep up to 75% of your wages as well as a private pension, a tax-exempt retirement account, IRAs and Roth IRAs and state teacher retirement system accounts. Your “wildcard” exemption allows you to keep up to $1,325 value in any property you choose. You are also allowed to keep unemployment benefits, disability benefits, earned income tax credits and the child tax credit, workers’ comp benefits and any crime victim compensation received during the 12 months prior to filing. Finally, you are allowed to keep up to $2,550 of value in implements, tools of your trade or books, and any spousal support or child support necessary to live on.
How Do I File for Chapter 7 Bankruptcy in Centerville, OH
If you have determined you are eligible to file for Chapter 7 bankruptcy, you may want information regarding the actual process. First, in the state of Ohio, you are required to attend and successfully complete a mandatory creditor counseling course before you file for Chapter 7 bankruptcy. While you can file for bankruptcy on your own, it is not recommended. Bankruptcy laws are complex, and there are many simple mistakes you could inadvertently make that could have serious consequences. Before you consult a Centerville Chapter 7 bankruptcy attorney, you will want to ensure you have all your financial documents in order. The following documents will be required—although you should make copies of all these documents rather than letting go of the originals.
- All your pay stubs or other proof of income for the past seven months
- If you receive any additional income outside of your regular job, you will need to include proof of this income.
- Both your federal and Ohio state tax returns for the past three years
- Three months’ worth of bank statements, along with proof of the balance in each of your bank accounts as of your filing date
- Creditor statements from everyone you owe money to that include the amount owed as of the filing date, your account number, and the address of your creditor
- A title or loan agreement for each vehicle you own—this includes boats, trucks, motorcycles, ATVs, trailers, and even mobile homes.
- Copies of your Social Security card and your driver’s license. If you do not have a Social Security card you need to order another either by going to your local SS office or ordering it online at the SS website.
- If you have life insurance, you need to include a copy of the policy declaration page.
- Statements from any retirement account you have, including IRAs, 401(k)s, 403(b)s, public/police/fire/school employee retirement, or other retirement accounts
- All loan documents for loans that were secured by property
- Copies of any lawsuit filed against you, including foreclosure lawsuits
- Marriage and divorce documentation
- If you have ever filed bankruptcy before, documentation from that bankruptcy filing
- Deeds or information regarding all real estate you own
- If you pay child support, a copy of the child support order
Your attorney will obtain and complete all the necessary bankruptcy filing forms, and you will be required to pay a filing fee of $335—although there is a provision that helps those who earn below 150 percent of the federal poverty line. You may also be able to pay the fee in installments in some cases. After signing all the filing forms, your attorney will file your Chapter 7 bankruptcy in District court. You must include your certificate of completion for the credit counseling course, along with proof of your identification.
Once the paperwork is filed, a Trustee will be assigned to you. The Trustee may ask that you provide specific documents for your hearing so they can be reviewed in advance. You will receive a notification of your 341 meeting (meeting of your creditors). After filing Chapter 7 bankruptcy and before you attend your 341 meeting, you must complete a second bankruptcy course, providing the court with documentation of completion. After your case is processed and your debts discharged, your bankruptcy attorney will receive notification that your case is complete.
Getting the Help You Need
Working with an Ohio bankruptcy attorney can be a good opportunity to discharge debts and experience a fresh start for your financial future. Your Ohio bankruptcy attorney from Horwitz & Horwitz has the experience and necessary skill set to maximize your rights and benefits from a Chapter 7 filing. In order to help you find the right answer for your unique debt problems and circumstances, contact Horwitz & Horwitz today.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.