If you and your family face financial difficulties or your debt is out of control, that can complicate things like getting a loan without a cosigner. You might find yourself getting deeper into debt due to unpaid credit cards because you must pay other bills instead.
If you are in any of these financial situations, then the solution to your financial problems might be bankruptcy. Filing for bankruptcy can allow consumers to free themselves from debt and, under some circumstances, keep their automobile and home.
A Kings Mountain bankruptcy lawyer at Farmer & Morris Law, PLLC may be able to help you file for bankruptcy.
Call Farmer & Morris Law, PLLC at (704) 482-1112 for a free case evaluation.
In This Article
How Filing for Bankruptcy Can Help Consumers
If you are unable to pay your debts, bankruptcy is a legal proceeding available to stop creditors from collecting on them. Those who are filing for bankruptcy in North Carolina might be able to:
- Eliminate or “legally discharge” their legal obligation to pay debts
- Stop the foreclosure process on homes or mobile home to allow time to catch up on missing payments
- Prevent the repossession of automobiles and other property
- Stop all actions from creditors regarding debt collection
- Restore utility services or prevent the termination of them
Bankruptcies typically do not allow for the:
- Elimination of secured creditors from collecting, like those who have a lien, for example
- Elimination or discharge of alimony, child support, court restitution, criminal fines, student loan debt, taxes, and other debts
- Protection to cosigners on debts which means, if bankruptcy occurs, they are still responsible for debt repayment
For a free legal consultation with a bankruptcy lawyer serving Kings Mountain, call 828.286.3866
Determining Whether You Need Chapter 7 or Chapter 13 Bankruptcy
There are many types of bankruptcy claims available in North Carolina, as detailed by the North Carolina Bar Association. However, Chapter 7 or Chapter 13 are commonly chosen. Consumers can file both of these cases individually, or as a joint-married couple.
Chapter 7 Bankruptcy
Another way of referring to a Chapter 7 bankruptcy is as a liquidation. Those filing for this type of bankruptcy are asking the court system to clear out all of their debt. When debts discharge, that means the debtor (the person filing for bankruptcy) may have to give up some of their property, with a few exceptions.
The exceptions include property the government considers exempt property. In many Chapter 7 bankruptcy cases, all of a debtor’s property is exempt. If the debtor has debt through a secured creditor, a Chapter 7 bankruptcy may not be a good option
Chapter 13 Bankruptcy
When debtors file for this type of bankruptcy, that means they are setting up a repayment plan with their creditors. It may be a good idea to file for Chapter 13 bankruptcies if:
- You are a homeowner who has difficulty keeping up with mortgage payments
- You are falling behind on debt payments and need help catching up
- Have a valuable property that is not exempt
- It is affordable for you to enter into a repayment plan with your creditors
Farmer & Morris Law, PLLC may be able to help you navigate the bankruptcy claims process and can work diligently on your behalf. When you hire us, we can take care of all details of your bankruptcy claim while you can concentrate on getting back on your feet financially.
For a free case evaluation, call Farmer & Morris Law, PLLC at (704) 482-1112.
Kings Mountain Bankruptcy Lawyer Near Me 828.286.3866
Understanding North Carolina’s Bankruptcy Case Exemptions
Those filing for bankruptcy in North Carolina might be able to protect the majority of their property. According to North Carolina § 1C-1601, property protections is another way of saying exemptions, and they include the following:
- Exempt property: if the property does not exceed the exemption amount and it appears on North Carolina’s exemption list, it is safe.
- Non-exempt property: if the property does not appear on the list of exemptions, the property can be sold to benefit their Chapter 7 creditors.
- Jointly-owned properties: if both spouses own property in North Carolina, they can double the amount of the exemption. Couples cannot double the exemption if only one spouse is the owner.
Examples of North Carolina’s Exemptions:
- Alimony or child support payments
- Burial plots
- Government benefits
- Life insurance
- Pensions and retirement income
- Personal injury compensation
- Personal property, like furniture, appliances and clothing
- Professional tools, like those necessary for your trade
What to Expect Regarding the Bankruptcy Process
The process for filing a bankruptcy case in North Carolina involves meeting two different requirements. These include:
- Passing the means test: those who are filing for Chapter 7 must meet income eligibility requirements. Doing so involves passing the “means test.” In the state of North Carolina, debtors must have an income that is lower than the median to pass. However, if you have an income exceeding the median, you could pass if you subtract allowable expenses. There is no “means test” when filing for a Chapter 13 bankruptcy.
- Participating in credit counseling: most debtors must participate in at least one credit counseling session before filing their bankruptcy claim. After filing the case, debtors must also participate in a financial management course to qualify for a discharge. Each of these courses receives approval through North Carolina’s Bankruptcy Administrator.
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Information You May Want to Gather
When preparing to file for bankruptcy, we suggest you gather lists of the following information:
- Creditors: create a list of all of the creditors you owe money to, as well as how much money you owe them.
- Income: supply evidence of all of your income, as well as the frequency of these payments.
- Assets: develop a list of every asset you currently have.
- Living expenses: detail a list of your monthly living expenses, including clothing, food, shelter, transportation, and utilities, for example.
A Kings Mountain Bankruptcy Lawyer In Your Corner
If your debts are piling up and you are unable to afford repayment to your creditors, you could qualify for filing a bankruptcy claim.
Call Farmer & Morris Law, PLLC for a free case evaluation: (704) 482-1112.