Understanding Chapter 13 Bankruptcy and Your Credit Score

Filing for bankruptcy is a difficult decision that many individuals face at some point in their lives. In North Carolina, understanding when it's time to file for Chapter 7 bankruptcy can be crucial in getting your financial situation back on track. This blog will explore the signs that indicate it may be time to consider filing for Chapter 7 bankruptcy and how this process can help you achieve a fresh start financially. One of the most common signs that it may be time to file for Chapter 7 bankruptcy is when you are struggling to make minimum payments on your debts. If you find yourself using credit cards to pay for everyday expenses or are constantly juggling bills, it may be a sign that your debt has become unmanageable. Filing for Chapter 7 bankruptcy can help eliminate most unsecured debts, such as credit card debt and medical bills, allowing you to have a clean slate and start rebuilding your credit. Another sign that it may be time to file for Chapter 7 bankruptcy is when creditors are constantly harassing you for payment. If you are receiving multiple calls from collection agencies or facing threats of legal action due to unpaid debts, filing for bankruptcy can provide relief from creditor harassment through an automatic stay. This legal protection prevents creditors from contacting you or taking any further actions against you while your bankruptcy case is pending. Additionally, if you are facing foreclosure on your home or repossession of your vehicle due to missed payments, filing for Chapter 7 bankruptcy can help stop these actions and give you the opportunity to keep your assets. By filing for bankruptcy, you can potentially discharge any deficiency balances remaining after foreclosure or repossession, allowing you to move forward without the burden of extra debt. If your income has significantly decreased due to job loss, reduced hours, or other circumstances beyond your control, filing for Chapter 7 bankruptcy may be necessary to alleviate financial strain. Chapter 7 bankruptcy is designed for individuals with limited income who cannot afford to repay their debts and provides a fresh start by eliminating most unsecured debts without requiring repayment through a repayment plan. Lastly, if you find yourself unable to save money or build an emergency fund due to overwhelming debt payments, filing for Chapter 7 bankruptcy can provide the relief needed to start saving again. By eliminating unsecured debts through bankruptcy, you can free up funds that were previously allocated towards debt payments and use them towards building savings or creating an emergency fund for future financial security. Knowing when it's time to file for Chapter 7 bankruptcy in North Carolina is essential in taking control of your financial situation and working towards a fresh start. By recognizing the signs mentioned in this blog and seeking guidance from a qualified bankruptcy attorney, you can determine if filing for Chapter 7 bankruptcy is the right solution for your financial struggles. Remember that bankruptcy is not a decision to take lightly but can be a valuable tool in achieving financial stability and regaining control of your finances.

Filing for bankruptcy can be a difficult decision to make, but it can provide you with the financial relief that you need. Chapter 13 bankruptcy is a popular choice for many North Carolina residents because it allows them to restructure their debt and protect their assets. However, understanding exemptions is crucial if you want to ensure that your assets are protected throughout the process. In this blog post, we will discuss two important questions that individuals often have when considering chapter 13 bankruptcy: Is my home exempted in chapter 13 bankruptcy? Can I keep my car after I file for chapter 13 bankruptcy? We hope that this information will help you make an informed decision about filing for chapter 13 and protecting your assets. Is My Home Exempted in Chapter 13 Bankruptcy? One of the most significant concerns people have when considering bankruptcy is whether they will lose their homes. Fortunately, most states, including North Carolina, offer a homestead exemption that protects the equity in your primary residence.  In North Carolina, the homestead exemption is $35,000 for individuals and $70,000 for married couples filing jointly. This means that if you own a home worth $200,000 and owe $150,000 on your mortgage, you have $50k of equity which would be protected by the exemption. It is essential to note that this exemption only applies to your primary residence. If you own additional properties or rental properties, those may not be exempted. Can I Keep My Car After I File for Chapter 13 Bankruptcy? Another common question people have about filing for chapter 13 bankruptcy is whether they can keep their cars. The short answer is yes; you can usually keep your car as long as you continue making payments on it. In North Carolina, there is a motor vehicle exemption of $3,500 per debtor. This means that if your car is worth less than $3,500, it would be entirely exempted. If your car is worth more than $3,500, you can use the wildcard exemption to protect additional equity. It is important to note that if you have a car loan or lease, you will need to continue making payments on it throughout the bankruptcy process. Failure to do so could result in the repossession of your vehicle. Other Exemptions There are other exemptions available when filing for chapter 13 bankruptcy that can help protect various assets. Some examples include: Personal property exemption: North Carolina allows individuals to exempt up to $5,000 in personal property such as furniture, clothing, and electronics. Retirement accounts: Most retirement accounts are exempt under federal law. This includes 401(k)s, IRAs, and pension plans. Tools of the trade: If you are self-employed or work in a specific trade (such as construction), you may be able to exempt certain tools and equipment necessary for your job. It is essential to consult with an experienced bankruptcy attorney who can help you understand which exemptions apply to your specific situation. Working with a Bankruptcy Attorney Filing for chapter 13 bankruptcy is a complex process that requires careful consideration and planning. An experienced bankruptcy attorney can help guide you through the process and ensure that your assets are protected throughout. Your attorney will help you understand which exemptions apply to your situation and develop a repayment plan that works for you. They will also communicate with creditors on your behalf and represent you at all court hearings. Filing for chapter 13 bankruptcy can be an excellent way to get back on track financially while protecting your assets. Understanding exemptions is crucial when considering this option; it can give peace of mind knowing what financial resources will stay protected during the process. If you live in North Carolina and are considering chapter 13 bankruptcy, we recommend that you consult with an experienced bankruptcy attorney who can guide you through the process. With their help, you can develop a repayment plan that works for your unique situation and protect your assets throughout the process.

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Who Qualifies For Chapter 7 Bankruptcy In North Carolina? Filing for bankruptcy is never an easy decision. However, if you are facing a mountain of debt that you simply cannot afford to pay, Chapter 7 bankruptcy may be the right choice for you. This type of bankruptcy is designed to provide relief to individuals who are struggling with overwhelming debt by wiping out most – if not all – of their unsecured debts. But who qualifies for Chapter 7 bankruptcy in North Carolina, and what are the steps involved in filing? In this blog post, we’ll explore these questions in more detail and provide some guidance on how to get started. Qualifying For Chapter 7 Bankruptcy To qualify for Chapter 7 bankruptcy in North Carolina, you must meet certain eligibility requirements. One of the first requirements is a means test, which is designed to evaluate your income and determine whether you qualify for Chapter 7 or Chapter 13 bankruptcy. In general, if your income falls below the state median income for your household size, you will likely qualify for Chapter 7. If your income is above the median, you may still be eligible if you can pass a more complex means test that takes into account your expenses and other factors. Another requirement for Chapter 7 bankruptcy is that you must not have filed for the same chapter of bankruptcy within the past eight years. Additionally, you must not have had a previous bankruptcy case dismissed within the past 180 days due to a willful failure to appear in court, to comply with court orders, or to meet other statutory requirements. Steps To Filing For Chapter 7 Bankruptcy  If you are considering Chapter 7 bankruptcy, the first step is to consult with a bankruptcy attorney who can help you understand your options and determine whether this is the right choice for you. Once you have decided to move forward with filing, the next steps will typically include: 1. Completing credit counseling: Before you can file for bankruptcy, you must complete a credit counseling course from an approved provider. 2. Preparing your bankruptcy petition: Your attorney will help you prepare your bankruptcy petition, which includes information about your income, debts, assets, and other financial matters. 3. Filing your petition: Once your petition is complete, it must be filed with the bankruptcy court in your area. 4. Attending the Meeting of Creditors: Within a few weeks, you will be required to attend a Meeting of Creditors where you will be asked questions about your bankruptcy case under oath. 5. Completing post-filing requirements: After your bankruptcy case is filed, you will be required to complete additional requirements, such as a debtor education course, and abide by certain rules and restrictions. At The Law Office Of Calvin Craig, We Can Assist You With All Aspects Of The Chapter 7 Bankruptcy Process And Help You Achieve A Fresh Financial Start. Chapter 7 bankruptcy can be a powerful tool for overcoming overwhelming debt and getting back on track financially. By working with an experienced bankruptcy attorney, you can determine whether you qualify for Chapter 7 and take the necessary steps to file your case and move forward in the process. At The Law Office Of Calvin Craig, we are dedicated to helping North Carolina residents find the debt relief they need and get a second chance at financial stability. Contact us today to schedule a consultation and learn more about your options.

Comprehensive Guide For All The Documents Needed To File For Bankruptcy Filing for bankruptcy can feel overwhelming, but it can be the fresh start that you need. However, one thing that cannot be avoided is the paperwork. Knowing what documents are required can make the process a bit manageable and less stressful. In this blog, we will provide you with comprehensive information on the documents you will need to file for bankruptcy under chapter 7 and chapter 13. Chapter 7 Bankruptcy: Chapter 7 bankruptcies filings are meant for those who have minimal income and are not able to pay their debts. Here is a list of documents that you will need to file for chapter 7 bankruptcy. - Income: You will need to provide proof of all of your income in the last six months. This includes pay stubs, all types of earned and unearned income, rental income if you are a landlord, child support payments, alimony and any other type of income that you have received. - Tax returns: You’ll need to provide federal and state tax returns along with any property or asset that was sold or transferred in the last two years. - Property and debts: Another crucial document is ‘Schedule A/B’ which deals with all the assets including personal items like jewelry, household furniture, cars etc. When it comes to debts, you will have to provide a list of all the creditors, including their names and addresses, the amount outstanding, and type of debt (credit cards, car loans, etc.) - Financial transactions: You will need to provide information on all recent monetary transactions in and out of your accounts. This includes personal loans, transfers of money, and cash payments made. - Credit counseling certificate: Finally, before filing for chapter 7, you will need to acquire a credit counseling certificate. Chapter 13 Bankruptcy:  In contrast to Chapter 7, Chapter 13 bankruptcy is for those who are able to settle their debts and repay their creditors through a repayment plan over 3-5 years. Here are the needed documents if you are planning to file for chapter 13. - Income: Again, you will need to provide proof for all income received over the previous six months. It includes any commission, bonuses, and overtime pay. - Tax returns: You must file copies of your tax returns or tax transcripts for the preceding four years. - Debts and property: Just like in Chapter 7, you will be required to fill up a detailed list of all creditors and their corresponding debts. The ‘Schedule A/B' will still include all property and other assets you own. - Budget: To show your affordability to create a payment plan to your creditors, it is necessary to present a budget that highlights your average monthly expense. The document needed for this is 'Schedule J'. - Credit counseling certificate: As with Chapter 7, before filing for Chapter 13, you will need to undergo credit counseling. When it comes to filing for bankruptcy, it is vital to have all the right documents in order to avoid any hiccups later on. Be prepared to deal with an extensive amount of paperwork but also remember that successfully submitting the required documents puts you a step closer to debt relief. For any queries regarding bankruptcy and the documents needed to file them, contact The Law Office Of Calvin Craig. We can assist you and answer any questions you may have. Our bankruptcy professionals are dedicated to providing the best financial solutions for the Raleigh community.