Articles Tagged with Bankruptcy Law

Possibly, but first you need to understand that a Chapter 13 plan is not based on your income.  It does not fluctuate depending upon how much you make.  The Chapter 13 plan amount depends upon what you plan on keeping and/or what creditors you plan on paying through the bankruptcy.  For example, if you are paying for only your home through your plan, the amount of the payments will be based upon the mortgage amount then that amount spread out over the life of the plan to catch up your back notes.  This amount won’t change unless your mortgage note happens to change.

However, if you are paying for several things – such as a student loan, a vehicle, a home, and a furniture note – through your Chapter 13 plan, the payments could become lower if you decide to stop paying toward the student loan or decide to surrender a vehicle, or the home, etc.

Since a Chapter 13 plan is dependent upon who you plan to pay and what you plan to keep – you can decide to change (with some exceptions) who you are paying and/or what you are keeping in order to lower the note.

Definition of StrategyAlthough there is not a limit on the number of bankruptcy cases you can file and no limit to the amount of time in between filings, there are limits to when you are eligible to receive a proper “discharge”.  So why would you want to file a bankruptcy case if you know you cannot receive a discharge?  There are several reasons why this strategy may be utilized.  For example, say that you recently filed a chapter 7 bankruptcy and wiped out your unsecured debt but you have student loan or tax debt that is non-dischargeable.  You could turn around and file a chapter 13 bankruptcy in order to be protected from garnishments, lawsuits, levies, etc relating to the student loans or tax debts for up to 5 yrs even though you would not receive a discharge.

Here are the time frames that must occur between filings for discharge eligibility (Note: the time is counted from date filed to date filed):

8 years between Chapter 7’s. -727(a)(8)

No.  There may be reasons why it would benefit you both to file together, but the choice is yours individually to make.  You cannot be forced to file with your spouse and likewise, you cannot force your spouse to file with you.  When you file alone, you are filing “individually”.  When you file together, you are filing “jointly”.  Everyone’s situation is unique and depends on the type of debt you have and whether or not you both are responsible for the debt, etc. It is important to review the possibilities of filing individually vs jointly to see which way would benefit you both the most.

If you are filing bankruptcy as an individual (not jointly with your spouse), yes, you must still report your spouse’s income. However, this in no way includes your spouse in the filing.  The court simply looks at your total household income for calculating eligibility   (Means Test) and for your post-bankruptcy household budget (schedule I and J).   Even though your spouse is not filing with you, it is highly recommended that you both participate in the consultation so that both of you understand the process and requirements. And as mentioned before – have decided that the best strategy for addressing your financial situation is to file individually.

There is an exception to this though if you are married but separated.  If you and your spouse are separated, your total household income is your income.  If your spouse is paying domestic support, you will need to include that in your totals.

To review the various clips of attorney Frank Coxwell’s appearances on the Fox 40 AM Show, click here to go to our Media page.  Mr. Coxwell discusses multiple topics on the show – the garnishment process, how to stop foreclosures in Mississippi,  how to deal with student loans, the pitfalls of the new “business” credit card offers, and more.

Frank on Fox Set 2Frank on Fox SetFrank on Fox Set 3

Most individuals will qualify to file for Chapter 7 regardless of the amount of debt.  However, income must also be considered when filing for Chapter 7 bankruptcy.  For example, if disposable income is sufficient to fund a Chapter 13 repayment plan — which is determined by your attorney completing what is called a “Means Test” which subtracts certain allowed expenses and monthly payments for certain debts from your gross income — you will not be allowed to use Chapter 7 bankruptcy but rather qualify for a Chapter 13 bankruptcy.

This is an area where it is important to consult with an experienced bankruptcy attorney. Your attorney will review your situation in depth through the “Means Test” process and advise you accordingly based upon the results.

So to sum it all up – an individual, a partnership, a corporation or other business entity may qualify to file for Chapter 7 so long as:

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