If you are being overwhelmed by your debts, bankruptcy could be a viable option for debt relief. It is extremely easy to give in to the stress and pressure of your finances, but you do have options. Below you will find a guide to Chapter 7 bankruptcies, and how they have been helping individuals and families become debt-free for decades.
Is There a Debt Limit?
There is not a minimum amount of debt that you must have to file for Chapter 7, but there is a maximum. You are not allowed to have more than $1,257,850 in secured debts, which usually stem from homes, cars, boats, or motorhomes. As far as secured debts, like credit cards, medical bills, or personal loans, the debt limit is $419,275.
What Debts Can I Get Rid Of?
There are several types of debts that you can have discharged from Chapter 7 bankruptcies. Most unsecured debts can be discharged by Chapter 7, here are some examples:
- Credit card debt
- Medical bills
- Personal loans
- Utility bills
- Past-due rent
- Some government benefit overpayments
There are also some secured debts that can be discharged by Chapter 7, however, they do need to be handed over to your creditor to fulfill the debts. These secured debts mainly include mortgages and car loans.
Do I Lose My Property?
The common misconception about this chapter of bankruptcy is that all of your assets will be liquidated in order to pay off your debts, and this is simply not the case.
Chapter 7 allows you to exempt certain items of property but there are limitations that vary depending on the property to be protected, the ownership interest, and the exemption statutes being applied. These exemptions vary depending on whether you are applying state law or federal law. By using the exemptions wisely, most of the time you can protect all of the equity in your home, vehicle, retirement, and other miscellaneous personal assets.
Contact Our Radcliff Bankruptcy Team Today
We understand how overwhelming finances can be. With over 100 years of legal experience under our belts, we are uniquely equipped to provide compassionate and personalized services to help you gain financial freedom.
If you have questions about how a Chapter 7 bankruptcy can help you this new year, contact us today through our website or give us a call at (270) 200-6326!