When your debts outweigh your income or assets, you might decide that you need to take action to get a fresh start financially. This is sometimes done by filing for bankruptcy. When it comes to consumer bankruptcy, or personal bankruptcy, you have two main options in Pennsylvania. You can file for Chapter 7 bankruptcy or Chapter 13 bankruptcy. In this post, we are going to discuss how we can help you work through the Chapter 7 process.
Chapter 7 bankruptcy is one in which you will have to complete a means test. This test determines if your income and expenses allow you to qualify for filing Chapter 7 bankruptcy. Anyone who is unable to pass the means test can't file for Chapter 7 bankruptcy, but they still have the option of filing for Chapter 13 bankruptcy.
If you are seeking protection under Chapter 7 bankruptcy, you should know that not all debts are able to be discharged under this chapter. Student loans and child support, for example, aren't able to be discharged. Debts such as medical bills and credit card bills are dischargeable under this chapter.
After filing for bankruptcy, an automatic stay goes into effect. This means that the debts filed as part of the bankruptcy are no longer eligible for collections. The bill collectors for those debts must stop contacting you about the debts when the bankruptcy is filed.
Throughout the process, whether you are just trying to learn about your options to control your debts or ready to file, we can help you ensure that everything is done in the appropriate manner.