Bankruptcy Lawyer in Greenville, SC
If you are thinking of filing bankruptcy in Greenville, South Carolina it is not complicated as you might believe. It is actually easy and straightforward to understand thanks to the 2005 Bankruptcy Act, which established specific guidelines that must be followed during a bankruptcy proceeding. Any debtor seeking bankruptcy relief must participate in credit counseling during the six months preceding the bankruptcy filing. After the filing, the debtor must take a financial management instructional course.
The Act also requires that the debtor’s expenses and income both undergo thorough analyzing to see if the qualifications are met for Chapter 7 bankruptcy or if Chapter 13 bankruptcy should be filed. The court will look at the debtor’s average income for the last six months and compare it to the median income in South Carolina for the means test. If your average income is higher than the median income, the rest of the means test will be performed to see if Chapter 7 can be filed or you must file Chapter 13 instead.
Before filing bankruptcy in Greenville, you have to gather all the pertinent documentation, which includes itemized proof of income, two years of major financial transactions, costs of living expenses, debts, and all property owned, not just real estate. You have to provide the last two years of tax returns, deeds for real estate, titles for any vehicles, and any loan documents. After gathering the documents, your Greenville bankruptcy lawyer will help you determine what property is exempted from being seized according to South Carolina’s exemptions.
Your attorney will file a petition consisting of two pages along with any other necessary forms in Greenville district bankruptcy court. These additional documents are referred to as schedules. Your detailed financial transactions for the last two years and detail your current financial situation. If you fail to be honest or provide accurate details, you might have your bankruptcy petition dismissed. It costs $306 to file Chapter 7 and $281 to file Chapter 13. The filing fee cannot be waived
What Are the Differences Between Chapter 7 and Chapter 13?
There are significant differences when it comes to Chapter 7 and Chapter 13 bankruptcy in South Carolina. Chapter 13 involves repaying your debts through monthly payments. Your petition has to include a copy of your proposed repayment plan. After reasonable monthly expenses are paid, you must show your available funds that can be paid toward your debts and how these funds are going to be divided among creditors. Priority claims, which are your secured debts, must be paid in full. Secured debts include car payments, mortgage payments, taxes, and back child support. Unsecured debts, such as credit cards, medical bills, and unsecured loans will usually be partially paid, sometimes as low as 10 cents on the dollar.
Your Chapter 13 repayment plan has to pass three tests: Ensuring it is delivered in good faith, making sure unsecured creditors are paid the same they would receive if you filed Chapter 7, and all disposable income must go directly into the plan for at least three years. The plan can be extended for up to five years in order to ensure the unsecured debtors are paid as much as they would receive in a Chapter 7 bankruptcy filing.
After you have filed Chapter 13, your monthly payments commence. Payments are usually withdrawn automatically from your earnings. Your Greenville bankruptcy attorney makes these arrangements with the court. After you have filed your bankruptcy petition in the court, an automatic stay will immediately go into effect to keep any creditors from making direct contact with you or from filing a lien or claim against your property starting on the filing date. If there are foreclosure proceedings, they are immediately stopped. All your debts are controlled by the court and the court takes control of any property not protected by South Carolina exemption regulations.
There will be a bankruptcy trustee appointed to your case to ensure your creditors are paid as much as possible. Your paperwork will be reviewed carefully with specific attention given to any assets you might have or exemptions that you claimed. Any part of your case might face a challenge from the trustee. The 341 Meeting of Creditors, which you must attend, is the first meeting of creditors. Usually, no creditors attend this meeting for a Chapter 7 bankruptcy, but one or two creditors who have questions might attend a Chapter 13 meeting. The meeting usually takes about five minutes. You will be sent a notice for the meeting, but contact the bankruptcy court if you need to confirm the date, time, or address.
There usually aren’t any exemptions in a Chapter 7 bankruptcy filing. If there are non-exempt assets in a Chapter 7, those assets must be turned over to the trustee after the meeting. Fair market value in cash can be turned over instead of the assets if you choose to do so. Any assets turned over will be sold and those proceeds will be paid toward any debts you owe. Any property that is difficult to sell or not worth much might be abandoned by the trustee and returned to you. There is a 60-day period where the trustee and creditors can challenge your right to a discharge of debts. If no challenges occur, the court will send you notice that all your debts have been discharged and you are not responsible for any remaining balances after three to six months. If Chapter 13 was filed, you will appear at a hearing before a South Carolina bankruptcy judge who will either deny or confirm your repayment plan. If confirmed and your payments are made on time, the remaining balance of any dischargeable debts will be eliminated at the conclusion or your bankruptcy plan.
Chapter 7 doesn’t involve repaying your creditors, so it is often referred to as liquidation bankruptcy. Federal statutes allow specific exemptions, which are $21,625 for real estate being used for a primary residence and as much as $3,450 for your vehicle. You also retain the right for state, federal, and domestic support benefits. Any non-exempt assets can and will be sold to help satisfy your debts. Any debts that remain are usually discharged at the end of the plan. You must pass the income eligibility test to file Chapter 7. If you want to avoid foreclosure proceedings, you should file Chapter 13. Chapter 7 does postpone foreclosure but doesn’t prevent it.
Debt Consolidation and Credit Counseling in Greenville
South Carolina does have alternatives to filing bankruptcy. Before deciding how to address any credit issues you are facing, you need to call all your creditors and try to come to an agreement with them. You should explain you are facing financial problems and are unable to make the current payments. Creditors are often willing to work with you. You might be able to set up a new payment arrangement with them.
Another option is a South Carolina debt consolidation loan. This allows you to get a single loan to pay off all your debts so you have only one payment to make each month. Last but not least is credit counseling. Credit counseling might let you lower your interest rates and make lower payments to your creditors. As a part of a credit counseling plan, you cannot apply for additional credit or go deeper in debt.
If filing bankruptcy is the right choice for you, your credit score won’t be destroyed. While there are some myths that make it seem as though your credit will be ruined for at least a decade, filing bankruptcy can help you get your credit back on track and improve your score more quickly. You could see a credit score as high as 700 within two years of your bankruptcy discharge. Without taking action, you will continue to have late payments and hurt your credit score even more. Get your credit back on track. Contact our Greenville bankruptcy attorneys today so you can regain control of your financial situation.