Chapter 7 Bankruptcy

Bankruptcy Firm Assesses Whether Chapter 7 Can Help You

Lawyer helps you eliminate much of your debt

A Chapter 7 bankruptcy gives you a “fresh start” by discharging certain debts such as medical bills, unsecured credit cards, and possibly even old tax debts. Once a debt is discharged, you have no financial liability for these debts. Debts for child support, alimony, recent taxes and student loans are generally not dischargeable in bankruptcy. You can choose to surrender property, such as a house or car, held as collateral for your debts. These debts then become unsecured and may be discharged in your bankruptcy. Or you can decide to hold on to the property and continue making the payments — this is called reaffirming the debt. People often reaffirm the debt on homes and cars, so they can keep them after bankruptcy. Reaffirming a debt may also help to rebuild your credit.

Oftentimes when a creditor has obtained a judgment against you, the creditor takes the next step and files a Certificate of Judgment, which becomes a lien on your home. In Chapter 7, to the extent that a judicial lien impairs the homestead exemption, the lien can be avoided or eliminated under the bankruptcy code. Once the lien is avoided or stripped off, it becomes unsecured and will be discharged in your bankruptcy.

Debt does not have to chase you for the rest of your life. Hockenberry Law Office, LLC’s bankruptcy attorney, Rebecca Hockenberry, has the experience and desire to help you. When you meet with her, she explains the intricacies of bankruptcy law and lets you know what to expect throughout the process.

What are the eligibility requirements for Chapter 7?

To determine whether a person qualifies for Chapter 7, two tests are performed. The first test is the liquidation test, which is a calculation of how much money would remain if you sold everything you own, paid off your secured creditors, and withheld a small amount of exempt property for yourself. In other words, how much cash could you raise by liquidating your assets? If the result is close to zero, then you pass the first test for filing for Chapter 7 bankruptcy.

The second test is the means test, which compares your income to your expenses and determines your disposable income. Standard living expenses are stipulated based on Internal Revenue Service national standards and local standards, but there are exceptions that may allow you to claim more expenses than usual. Secured debt payments you plan to reaffirm and family support obligations can be included as expenses. If your expenses are reasonable and you still have very little to no money left at the end of the month, then you pass the second hurdle for filing under Chapter 7.

Our bankruptcy attorney determines if you are eligible to file a Chapter 7 or Chapter 13 bankruptcy by asking you a few basic questions, including:

  • How much money do you make at your job?
  • Do you have any other sources of income?
  • What are your estimated monthly expenses?
  • What is the estimated value of your home?
  • How much debt is owed on your home?
  • What is the approximate value of your vehicles?
  • What is the approximate debt owed on your vehicles?
  • What is the value of your non-retirement investment and bank accounts?
  • What other big ticket assets do you have?
  • What other types of debt do you owe?

Call a Central Ohio bankruptcy attorney for a free consultation

Hockenberry Law Office, LLC provides comprehensive bankruptcy representation for clients throughout Ohio. We offer free consultations in bankruptcy cases. Call us at (567) 560-2095 or contact us online to schedule an appointment. Evening and weekend appointments are available.


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