How Bankruptcy Laws and Your Finances May Affect the Bankruptcy Process

 Posted on April 10, 2015 in Chapter 7 bankruptcy

In addition to the stress that bankruptcy can cause, there is a long list of steps that you must take before filing. However, you should keep in mind that bankruptcy can put you on the path toward a debt-free life, so completing the necessary procedures may be a smart decision.

According to the U.S. Government Printing Office, the Bankruptcy Abuse Prevention and Consumer Protection Act passed in 2005. It requires people in Texas to complete credit counseling six months prior to filing for bankruptcy. You must also complete a financial management course after filing.

Your income and expenses may determine the bankruptcy chapter that you need to file. This is why chapter 7 filers must complete a means test to determine if their income is low enough.

Chapter 7 filers typically have incomes that are below the national median. In most cases, filers must be able to commit to at least $100 per month over the 60 months after filing.

When determining which chapter to file, you will need to calculate if you can pay at least 25 percent of your unsecured debts. These may include medical and credit card debts. If you cannot afford this, then you may need to file for chapter 7.

Before you file for chapter 7 bankruptcy, make sure you have the following information:

•         Your current income amount and income sources;
•         Financial transactions for the previous 48 months;
•         Detailed list of all living expenses;
•         Secured and unsecured debts;
•         Value of applicable property and possessions;
•         Income tax documents; and
•         And loan or mortgage papers.

Your bankruptcy lawyer will help you file petitions for any exemptions. It is important to remember that any fraudulent documents or omissions found during the evaluation of your application can result in an immediate dismissal of your petition.

The First Step: Contact an Experienced Bankruptcy Attorney in Texas

A San Antonio bankruptcy lawyer can assess your case and help you determine if filing for bankruptcy is a smart decision. Attorney Chance McGhee has more than 20 years of experience helping people from all backgrounds get the fresh financial start they need through bankruptcy. Call 210-342-3400 to schedule a consultation.