BANKRUPTCY BASICS

While it is legal to represent yourself when filing for bankruptcy, it’s strongly recommended that you hire a bankruptcy lawyer.

Most people who attempt to file for bankruptcy by themselves end up missing critical details in technical documents, lose more assets and owe more money than they would have with the expertise of a bankruptcy lawyer.

That being said, it’s extremely important to go with a bankruptcy lawyer that you feel 100% confident to represent your financial situation, assets, and best interests. Credit Solutions S.C. offers a free consultation to determine if you should file bankruptcy and what chapter of bankruptcy is best for you!

What can individuals expect during a free consultation with Credit Solutions?

During your free consultation with our law office, you can expect a thorough discussion covering various aspects. We will begin by identifying the creditor or debt collector that is causing you distress. We will then delve into the details of your bankruptcy filing, ensuring we have a comprehensive understanding of your case.

As part of the consultation, we will also explain the laws applicable to your situation, ensuring that you are aware of your rights as a consumer. If any violations of these laws have occurred, we will discuss the corresponding legal actions that can be taken against the wrongdoer. We will provide you with insights into what you can expect from such lawsuits, helping set realistic expectations for the outcome.

Throughout the consultation, we may require specific information and documents from your bankruptcy case. However, there is no need to worry if you are unable to locate certain documents, such as your bankruptcy discharge order. We can usually access these records directly from the court during our call.

It is important to remember that initiating a free consultation with our law office is always the right decision. It enables us to gather the necessary information, assess your case thoroughly, and offer you the guidance and assistance you need during this challenging time.

How do Chapter 7 and Chapter 13 bankruptcies and a Chapter 128 (non-bankruptcy) compare?

Chapter 13 bankruptcy offers a viable solution for individuals who do not qualify for Chapter 7 bankruptcy. Many people who file for bankruptcy must undergo the 'Means Test,' a thorough evaluation of their finances, with a particular focus on their monthly income. This test determines eligibility for Chapter 7 bankruptcy, as individuals with incomes above a certain threshold may not qualify. However, for residents of Wisconsin, there is an alternative bankruptcy option known as Chapter 128.

Chapter 128 is available exclusively to state residents and provides debt relief features similar to those found in Chapter 13 bankruptcy. Although it is not a formal bankruptcy declaration, Chapter 128 offers several advantages. One notable benefit is the significantly shorter time frame required to complete the process compared to filing for traditional bankruptcy. Additionally, Chapter 128 does not impose the same level of restrictions and penalties associated with conventional bankruptcy proceedings.

It is important to note that while Chapter 128 may seem appealing, it is crucial to thoroughly understand the requirements and considerations involved in both Chapter 13 bankruptcy and Chapter 128. For those who do not meet the eligibility criteria for Chapter 7 bankruptcy, Chapter 13 provides a potential solution. It allows individuals to reorganize their debts into a single monthly payment, free from interest or late fees.

To initiate a Chapter 13 bankruptcy, individuals must fulfill certain conditions. By filing for Chapter 13 bankruptcy, individuals can regain control of their finances and potentially save their homes and properties from foreclosure.

In addition to these requirements, there are several financial considerations to bear in mind when pursuing Chapter 13 bankruptcy. Initially, an attorney fee and a court fee is required, and individuals are obligated to complete a credit counseling course, which can be conveniently done via phone, online, or in person. Furthermore, a court hearing with the court-appointed trustee is mandatory, accompanied by your attorney. Completing a financial management course is also necessary prior to the end of the bankruptcy and administered in a manner similar to the credit counseling course.

Compared to Chapter 7 bankruptcy, Chapter 13 functions differently. Rather than discharging debts entirely, Chapter 13 reorganizes them into a manageable monthly payment plan. However, exceptions exist for secured creditor interests, such as mortgage arrears, vehicles paid through Chapter 13, or secured tax claims.

One fundamental distinction between Chapter 13 and Chapter 7 bankruptcy lies in the requirement to submit a repayment plan, which must last between 36 and 60 months. This plan safeguards various properties, including homes, vehicles, and personal assets unless voluntarily surrendered to creditors. It is important to note that mortgage or equity loans on homes are paid outside of the plan and must be promptly and fully settled each month.

During the Chapter 13 bankruptcy process, individuals are expected to adhere to a cash-only basis, and the trustee will request copies of their tax returns annually.

To finance a Chapter 13 bankruptcy, individuals must possess a stable income and have discretionary funds remaining after covering reasonable monthly expenses. The repayment plan is contingent on disposable income, secured debt paid through the plan, and the results of the means test. This plan encompasses all unsecured debt, past-due taxes, mortgage arrears, and financed vehicles. Monthly payments are made directly to the trustee or through wage assignment, and the trustee utilizes these funds to satisfy the creditors according to the terms specified in the confirmed repayment plan. In some cases, individuals may find themselves paying significantly reduced amounts to their unsecured creditors. This may sound confusing but our expert attorneys at Credit Solutions S.C. will easily be able to walk you through this process!

While considering options for debt consolidation, it may be tempting to explore credit consolidation services or programs. However, it is essential to understand that Chapter 13 bankruptcy often presents a more financially sound choice. Many credit consolidation programs impose high monthly rates, and individuals remain responsible for the interest on their debts. Additionally, these programs do not necessarily shield individuals from creditor lawsuits, and not all creditors may agree to participate. Moreover, credit scores are at risk, and these programs often endure longer timelines compared to Chapter 13 bankruptcy.