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Submitted by the Bond & Botes Law Offices - Thursday, December 11, 2014
This is a daily question for our staff and I can certainly understand why you would want to know! However, we cannot quote a fee unless we know more from you. When the Bankruptcy Code changed in 2005, it made changes that determine if one is able to file Chapter 7.
Our offices offer a free consultation where we can get information from you that will let us know if you qualify to file without losing property.
Chapter 7 and Bankruptcy Code Changes
Chapter 7 bankruptcy is a liquidation of your assets. In Alabama, you are allowed $3000 in personal property ($6000 if filing jointly with your spouse) and $5000 in homestead exemptions ($10,000 if filing jointly and the spouse co-owns the property with you). What this means is if you owe a vehicle worth $10,000 and no lien, the court appointed trustee can liquidate or sell the property to pay your unsecured creditors something. The same would be true if you owned your house valued at $75,000 with no lien. You could keep $5000 from profits from the sale by the trustee with the rest to be paid to your unsecured creditors.
Another major change that the new Code brought is called the means test. This is a form that takes the six month average of income and multiplies it by 12. The yearly figure is compared to the median income for your size family in the state you reside. If you make more than the median income, the means test has to be completed and it determines if you eligible to file Chapter 7.
So please schedule an appointment with us so we can go over whether Chapter 7 is a good fit for you and your family. We will explain both Chapter 7 and Chapter 13 so you can make the best decision. We work with our clients to pay fees in monthly payments too! Paying anything can be difficult when your finances are tight, so we will work with you as much as possible to give you the financial freedom you are seeking.
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