Making the choice to file for bankruptcy is a difficult decision. The decision is further complicated by the vast amount of misinformation about bankruptcy that is commonly believed. You cannot properly determine whether bankruptcy is the best solution to handle your debt problem until you have reliable and factual information about bankruptcy.
We have been practicing bankruptcy law for over 35 years. Over the decades, at nearly every free consultation with a prospective client, we clear up misinformation about bankruptcy. Based on our experience, the following are 5 Things We Want You to Know About Bankruptcy.
- Bankruptcy has the power to erase medical debt and credit card debt.
While not all types of debt can be erased through bankruptcy, medical debt and credit card debt are dischargeable―meaning they can be erased through bankruptcy.
- You will be able to keep your belongings.
The majority of people who file for bankruptcy are able to keep most or all of their personal belongings, property, and other assets.
The U.S. Bankruptcy Code, as well as the state of Georgia, provides for you to keep property, assets, and other belongings valued up to a certain dollar amount through exemptions. You get to keep the exempt property if its value does not exceed a certain dollar amount. For more information, read our article Filing Bankruptcy Does Not Mean Giving Up All Of Your Possessions.
- Even people who earn high income can qualify for bankruptcy.
It is common bankruptcy misinformation that qualifying for bankruptcy is nearly impossible. The fact is that qualifying for bankruptcy is case specific and even people with high income can qualify for bankruptcy.
If your net income falls below your state’s median income, adjusted for your household size, then you automatically qualify for Chapter 7 bankruptcy. If your net income is above your state’s median income, adjusted for your household size, then you must run the Means Test to demonstrate that you qualify for Chapter 7.
As of November 1, 2017, the median household income in Georgia is:
- Household of One: $45,142
- Household of Two: $58,363
- Household of Three: $65,900
- Household of Four: $78,368
- Households of more than four: add $8,400 for each individual in excess of four.
If your income is above the median then you must include additional paperwork in your bankruptcy petition called the Means Test. The Means Test calculation considers your average income over the past 6 months minus “allowable expenses.”
An experienced bankruptcy attorney can help you navigate through the Means Test and qualify for the debt relief that you deserve. If your income truly precludes you from qualifying for Chapter 7 bankruptcy, you may still be eligible for relief from your debts under Chapter 13 bankruptcy.
- Collection phone calls will stop.
As soon as you file for bankruptcy all collection action against you must stop, including collection calls. The automatic stay, a provision of the Bankruptcy Code, puts an immediate end to collection phone calls, wage garnishments, bank levies, lawsuits, and any other debt collection action against you.
- Filing for Bankruptcy is a financial decision.
Filing for bankruptcy is not a moral decision, it is a financial decision. It does not make you a bad person or a failure. Bankruptcy protection is your legal right. If after exploring all of your debt relief options you choose to file for bankruptcy, then you have made the right financial decision for you and your family.
Are You Struggling with Debt?
Here at the Law Office of Barbara B. Braziel, we help people get out of debt. We are the premier bankruptcy law firm in Savannah, GA and we practice exclusively in bankruptcy law. Our experienced attorneys are committed to ensuring you understand the protections and benefits of bankruptcy and how filing will affect you and your family. We take the time to explain the bankruptcy process to our clients. We invite you to get to know us here and read about the clients we’ve helped here.
Call us today at (912) 351-9000 or contact us to schedule a free consultation.
We are a debt relief agency. We help people file for bankruptcy relief under the U.S. Bankruptcy Code. Find out more about Bankruptcy in our guide: All About Bankruptcy.