Qualifying for Bankruptcy
Do you want to learn more about qualifying for bankruptcy? Watch this legal video. Then call experienced Jamestown bankruptcy lawyer Scott Humble for guidance on your matter.
The other day, I had a client come in who wanted to know about qualifying for bankruptcy. There’s a couple of ways of looking at this. There really isn’t a technical qualification process for bankruptcy. Anyone can qualify for bankruptcy, but the question becomes pursuant to the changes in bankruptcy law, which took effect on October 17th, 2005. Do you qualify for a Chapter 7 bankruptcy? If you must file a Chapter 13 bankruptcy, are you going to be able to pay the minimum that is allowed?
Now, the key here is unsecured creditors, and what people have trouble sometimes getting in their mind and understanding is that that is where your savings is on a Chapter 13. In other words, that’s where you get your savings. You pay a lot less. The minimum in our jurisdiction is five percent for five years, so that’s only one percent a year or a penny on a dollar for each year, so that’s a huge savings. That’s a drop in the bucket compared to what people owe in unsecured debt, so it comes out to a spectacular deal, basically, for anybody that files.
One step better is to pay nothing, and that’s what our goal is in Chapter 7. When someone comes in, my knee jerk reaction, is that they want to keep everything, house, car, whatever the case may be, and number two, that they want to file Chapter 7 and not pay any unsecured creditors back and be in and out of the whole process in less than four months.