Are you stressed because your home is in foreclosure? It may be wise to talk to a Bankruptcy Lawyer In Puyallup Wa. Lawyers help to save homes through the bankruptcy process. Judges issue a temporary stay when a bankruptcy is filed. This means all collection activity must cease. Talk to a lawyer about what bankruptcy can and cannot do for you.
Bankruptcy Will Not Erase All Debts
A Bankruptcy Lawyer In Puyallup Wa advises clients that some debts can’t be erased by bankruptcy. For instance, child support, alimony and federal income tax must be paid. Bankruptcy will erase credit card debt and medical bills. Further, some filers will be able to prevent foreclosure and keep the property. The most popular consumer bankruptcies are Chapter 7 and 13.
You Must Qualify For Chapter 7
Chapter 7 filers claim there’s not enough money to repay their debt. They have to pass the means test in order to be successful. The test determines whether the debtor is telling the truth about their finances. If they pass, the court liquidates assets to pay part of the debt and the rest is discharged. A discharge means the debtor is no longer responsible for the debt. Likewise, creditors cannot come after them.
Living With Chapter 13
Chapter 13 is a wage-earner’s bankruptcy. Individuals earn enough money to make a monthly payment to the bankruptcy court. The court applies the payment to secured debt like mortgage and car note arrears. However, the debtor must still keep the monthly payments current in order to keep their property. Most filers find they don’t have a lot of disposable income. Indeed, debtors must live frugally during the course of the bankruptcy. The bankruptcy lasts for three to five years.
Bankruptcy is designed to give the consumer a way out of debt. Further, debtors are allowed to keep their property if they make monthly payments. Chapter 7 filers are discharged from debt in three to four months. On the other hand, Chapter 13 filers must wait until the bankruptcy is paid. Nonetheless, the process gives all debtors a fresh financial start. Bankruptcy stays on the credit report for several years but that’s a small price to pay.
