Filing for Chapter 7 Bankruptcy in Mississippi
Chapter 7 bankruptcy is a good option for those who truly need a fresh financial start. During the process, most of your unsecured debts, such as credit cards, medical bills, and signature loans will be eliminated, and you can also use Chapter 7 to surrender your house or cars that you no longer want or can no longer afford. On the other side of Chapter 7, you are left with a clean slate on which to draw a new plan for your financial future.
Chapter 7 Eligibility
The primary factors determining if you are eligible for Chapter 7 are being below a certain income level and not having filed for Chapter 7 bankruptcy within the previous eight years. Income level requirements vary based on your family size. For example, the median income for a single person in Mississippi is about $35,000 a year, while the median income for a family of four is about $60,000 a year. If your current monthly income is less than the median income for a household of your size, you pass the Chapter 7 “means test,” and you are eligible for Chapter 7 bankruptcy.
Even if you make over Mississippi’s average income, you may still qualify for Chapter 7 due to expenses you will be required to pay after bankruptcy, such as house notes, car notes, child support, payroll taxes, health insurance, and mandatory retirement. Your “disposable income” must be less than the amount you need to make payments on your unsecured debts.
Chapter 7 Procedure
Once you decide Chapter 7 bankruptcy is right for you, it’s best to contact a Mississippi bankruptcy attorney to guide you through the proceedings and ensure all of your debts and property are handled appropriately. Your lawyer will help you prepare and file a petition with the bankruptcy court, which triggers the “automatic stay.” This means your creditors must stop attempting to collect from you.
Soon after you file for bankruptcy, you’ll attend a meeting with a court-appointed trustee and any of your creditors who choose to attend. Then, the court determines how your debts will be resolved, including which property will be sold and which debts will be discharged, i.e. eliminated. After all is said and done, you will be able to start rebuilding your credit and address any lingering financial issues.
Exempt Assets
Many people fear filing for Chapter 7 bankruptcy because they believe they will have to sell their home, car, or other property. While it is true that you may have to sell some assets, property you own or have equity in is generally protected when you file bankruptcy. In Mississippi, your home is protected up to $75,000 in equity, cars and household goods are protected up to $10,000 for a single person or $20,000 for a married couple, and retirement usually has unlimited protection.
Contact the Gardner Law Firm for Help with Chapter 7
This is a quick outline of some of the ins and outs of Chapter 7 bankruptcy. For more information about whether Chapter 7 is right for you, please contact the Gardner Law Firm for advice from an experienced Mississippi bankruptcy lawyer. Your first consultation is free.