Debt can be like an anaconda around you. As you miss payments, the fees and interest tacks on and it squeezes you tighter and tighter. Now that $10 hamburger you used your credit card for is costing you $25 because of fees and that annual interest rate of 24.99%. Bankruptcy can help offer you the peace and freedom you are looking for.Bankruptcy Filing
There are two types of consumer bankruptcies: Chapter 7 and Chapter 13. Our goal in both types is to get you to have most or all of your debt forgiven (discharged) and let you keep the things that mean most to you, like your home.
In a Chapter 13 Bankruptcy, we are telling the court that you are entitled to relief, but that you make too much money to qualify for a Chapter 7 discharge. For Massachusetts, that number is $70,834 annually, and for New Hampshire, that number is $71,169 annually. That limit is for one earner, so if you have multiple dependents, the number is higher. Meaning, you could make more than that and still qualify for a Chapter 7 petition.
In a Chapter 13 Bankruptcy, you will enter into a payment plan for 3-5 years where you will pay the Trustee one monthly payment and they will pay your creditors on a percentage basis. How much will you pay back? It will depend on your disposable income and total assets. If they are high, you will pay back more. Generally, the debt will pay back a small fraction of what was originally owed at the end of the 36-60 payments. The remainder of the debt is forgiven after completion of those payments.
Again, a Chapter 7 is a complete discharge of the debt, which means that your creditors can never come after you again.How Quickly Does the Debt Relief Come?
To a certain extent, Debt Relief can come quick. Bankruptcy helps to stop collection actions against a debtor and also gives the debtor the relief they need. If a collector is instituting a collection action against the debtor, the filing of the Bankruptcy Petition will “stay” all collection proceedings.
A classic example would be if a collector is foreclosing on a house. The collector has gone to court and even gotten an order to sell the house at auction. An auction is scheduled for tomorrow. The debtor is living in the home and needs time to relocate. The moment the bankruptcy is filed, the attorney will send notice of the bankruptcy to the foreclosure attorney/collector. In that letter they will include the “Notice of Bankruptcy Case Filing” which tells the creditor that there is an order to “stay” (stop) all collection actions. The auction will then be cancelled or the bank risks having stiff penalties levied against them.
Once the bankruptcy petition is filed, it is generally 45 days or so until there is a meeting of the creditors. For a Chapter 7 case, once the meeting occurs in front of the Bankruptcy Trustee, discussed elsewhere, the Trustee will enter an order. If they enter an order finding that there are no assets and the debtor is entitled to discharge, the creditors will generally have 60 days to object.
During that 60 days, a creditor could object to the discharge for a variety of reasons, but they often do not, especially where the debtor has no assets. At the expiration of that 60 days, the court will enter an order “discharging” the debt and the debtor is now debt free. Things like student loans and support obligations will not be discharged.
Debt can be a tough thing to overcome. You don’t have to solve the problem alone. We can help you get the debt relief you need. Call the Bankruptcy Lawyers at Marcotte Law Firm today for a free consultation at (978) 458–1229.