Chapter 7 Bankruptcy

A Massachusetts bankruptcy attorney can help you break free from overwhelming debt burdens by filing Chapter 7 Bankruptcy. With an experienced Massachusetts Bankruptcy attorney by your side, a Chapter 7 Bankruptcy filing can eliminate 100% of unsecured debts including balances owed on credit cards, medical bills, foreclosures, short sales, repossessions, personal loans, and even utilities, which may have built up over the years. The end result of the discharge of these debts means that your debt essentially goes away.

In addition to wiping out the balances due on all unsecured debt, a Chapter 7 Bankruptcy also provides the following benefits:

A Chapter 7 bankruptcy, usually, allows you to keep all of your property –As long as you pay your mortgage, you can keep a house with up to $500,000.00 in equity in it and can keep a vehicle with $7,500.00 of equity, if you continue to make your payments.  Most retirement plans are also exempt.

Rebuild your credit – It is much easier to rebuild credit out of Chapter 7 than it is to rebuild out of a mess.  Even mortgages can be procured after a Chapter 7 filing.

Save your sanity – Stop harassing phone calls. Creditors are not allowed to contact you once you file.  In fact, merely hiring Attorney Haskell will make the phone calls stop for awhile.

Stop wage garnishments – Filing a Chapter 7 bankruptcy is one of the most effective methods available to stop wage garnishments immediately . By freeing wages, which were being lost to garnishments, your “take-home” pay can return to its previous level.

A Chapter 7 filing will stop the pursuit of judgments against you through lawsuits.

Stop the foreclosure process – Filing Chapter 7 with the help of Attorney Louis S. Haskell will stop foreclosure proceedings immediately. The stoppage can allow for the bankruptcy process to discharge garnishments, liens, and debt payments, freeing cash to catch up on mortgage payments, or allowing the opportunity to seek a modification

Stop repossession – The stoppage of repossession can work much in the same way as a Chapter 7 filing which stops a foreclosure. By increasing available income and/or eliminating debt obligations, the process can enable you to catch up on auto payments.

A more cost-effective solution – Chapter 7 bankruptcies are almost always less expensive and quicker than Chapter 13 Bankruptcies.  Be sure to consult an experienced Massachusetts or New Hampshire bankruptcy attorney to help determine your best path toward debt relief. Qualifying for a Chapter 7 bankruptcy with a complete discharge of debt, as opposed to being put on a payment plan in a Chapter 13 or debt settlement, can get you back on your feet and rebuild your credit much faster.

Chapter 7 Bankruptcy

Under the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), which is also sometimes called the “bankruptcy reform” you need to “pass” the means test in order to file for bankruptcy under Chapter 7. One way to pass the means test is simply not to be a “high income debtor”. That is to say your income must be below the median income in your state for a family your size. Currently in Massachusetts, the median income for family of one is a little over $56,000, while the median income for a family of four is just above $106,000. If you are below median, you automatically pass the means test and are likely qualified to file Chapter 7. If you are above the median, then you have to take the rest of the means test which is a budget formula that determines whether or not you have the ability to make any payment at all to your creditors. Some budget items are imposed by looking at IRS guidelines. These would include food, utilities, health care expenses and transportation. In rare cases it is possible to deviate from the IRS guidelines. For example, if you live in Lowell but work in Taunton, we can probably get your transportation allowance raised. If you are in particularly poor health and have to take a lot of prescription drugs, or have a number of doctors appointments, then the health care allowance can be raised so long as you have the documentation to prove it. We once had a case where we raised the food allowance because the client was on a special diet for health reasons. Sometimes in the means test we use actual expenses for items such as taxes, health insurance, mortgage payments and child support. Sometimes we use modified payments, such as for car loans. The car loan formula is just too weird to describe here. In any event, all of these numbers, some real and some imaginary, are plugged into the formula and out comes a number. If the number is negative or very small, then you have passed the means test and may file Chapter 7. Otherwise, you may be forced into Chapter 13 and you will have to pay the means test result for a five-year period.

If you are able to file for Chapter 7 bankruptcy, then your slate is wiped clean and your debts are “discharged”, or made to go away. Your creditors may not garnish wages or do anything else to try to collect the debt. All this can usually be accomplished within 6 months, usually while keeping your house, car, retirement money and other property.

If you feel you may qualify to apply for bankruptcy under Chapter 7, please contact us at 978-459-8359 for a free non-obligatory consultation.