Filing Chapter 7 Bankruptcy in Forth Worth
June 25, 2010
It takes time to do anything worthwhile, but when it comes to filing for bankruptcy, time is money. If you want to discharge debts, you may fear losing assets. They’ll take your home and car, you’ll be unable to get a new mortgage or loan, and your bank account will quickly shrink, right? Even worse, how can you pay a lawyer when money is the problem?
If you file in Fort Worth, Texas, Chapter 7 bankruptcy is an effective way to discharge debts, to save time and money, and to keep your assets. You need not fear losing your car; in the majority of Texas Chapter 7 bankruptcies the filers lose nothing. You will have a hard time getting a new mortgage or loan immediately, but if you start rebuilding your credit it won’t be long before you can. And if you hire the right Fort Worth bankruptcy lawyer, you won’t be overcharged.
So how do you start?
The First Step
Should you file? And what about Chapter 13 bankruptcy? The first step is deciding if you can file. You may not be eligible, for one, but you also might have some better alternatives. There are options other than Chapter 7 bankruptcy, such as filing Chapter 13. In some cases, you may not even have to file bankruptcy at all. But bankruptcy can effectively solve many debt problems in a matter of months.
Chapter 7 bankruptcy is a liquidation proceeding, where a court appointed trustee will be selling your assets to pay back debt. They sell your stuff? Yes, by law they can. As stated earlier, the great majority of filers lose absolutely nothing. If you are about to lose your home or car, you can set up a separate plan with the trustee to start paying on it; this is perfectly legal and very common.
What debts can you discharge?
The most common debts in Texas and in the whole country are medical, credit, and mortgage debts. A recent study highlighted how, surprisingly, credit cards are not the main problem. Medical debts are the most common reason for filing bankruptcy in the country. This means more people file for help not because of cards of plastic or homes, but for rooms at hospitals and expensive medications. It makes sense: millions of U.S citizens have no health insurance. It’s unfortunate, but you can discharge tens of thousands of debt you simply cannot afford by filing Chapter 7 bankruptcy.
Are you eligible?
Unfortunately, while most Fort Worth residents are eligible for Chapter 13 bankruptcy, the same residents may not be eligible for Chapter 7. It’s because you make too much money in most cases. With Chapter 13, unless you have hundreds of thousands in debt, you are eligible. If you make more than the median Texas income for 2010, you are not eligible for Chapter 7.
1 Person – Annual Income Less Than $38,801
Family of 2 – Annual Income of Less than $55,660
Family of 3 – Annual Income of Less Than $59,011
Family of 4 – Annual Income of Less than $66,145
Add $7,500 in most cases per any additional family members.
Is Chapter 13 better?
Chapter 13 bankruptcy is less common because it means you’ll be paying off on debts, not eliminating them. It’s benefits include many of the same as Chapter 7, though it’s better if you fear foreclosure. It’s different, not better or worse.
You should consult with a Forth Worth bankruptcy lawyer before you make any big decisions. Most will be affordable, give you a free consultation, and clearly show you their experience.
How Much Does a Texas Bankruptcy Lawyer Cost?
June 23, 2010
Finding a lawyer is tough enough, but actually paying a Texas lawyer with experience can sometimes be difficult. You are filing bankruptcy to save money and assets, not spend money and lose assets. Sometimes you may think hiring a lawyer is not feasible. In all cases, it’s more than worth it, and they may charge less and save more than you might think.
What? A bankruptcy lawyer saves you money? Yes, but you need to hire the right one first.
How to Hire a Texas Bankruptcy Lawyer
Looking online may seem risky, but even though many lawyers have no website, it does not mean the ones who do are any less experienced. In fact, you can look directly at this experience online 24/7. Some have blogs like this one, some show their relevant experience, and most will give you a ball park estimate on how much you will have to pay in order to file for bankruptcy.
How much does Texas bankruptcy cost?
Technically, the only differences between a Texas bankruptcy and one from another state is in terms of eligibility, lawyers, and what court you file with. Most of the rest is very similar, as bankruptcy is a federal code, not solely state run.
Let’s get back to the main point. A Chapter 7 bankruptcy will cost you $299 to file with the court, and the average Texas lawyer will charge you about $1,000-$2,500 for this bankruptcy. There are some big differences in those price ranges – some lawyers go lower still and some even go higher – but it depends on the actual complexity of your case. So if you hired a Texas lawyer for Chapter 7 bankruptcy, it might cost you a total of $1,800 to file. Now, look at the benefits of Chapter 7. You can discharge the majority of your debts, including tens of thousands in medical, credit card, and mortgage debt. If you are considering bankruptcy, you likely cannot afford to pay on all or at least some of these debts. The more you owe, the bigger the benefit. If you can discharge $10,000 for a fraction of that, the benefits are quite obvious.
If you file Texas Chapter 13 bankruptcy, the court fee is $274 with the court, and about the same amount of lawyer fees, ranging from $1,000-$2,500. Now, in this case you are not eliminating your debts; you’re paying on them in an affordable manner over 3-5 years. So it might cost you $2,000 to file Chapter 13 and hire an experienced Texas lawyer, but once you see the benefits the value is clear. If you fear your home is going into foreclosure, a property worth $100,000 with a mortgage you’ve been paying on for years, with Chapter 13 you can stop any foreclosure proceedings before it even reaches court. You can also create a payment plan for other debts, such as credit and medical, over a longer and more affordable period.
So we got some ball park estimates on filing for bankruptcy. While not cheap, think of filing bankruptcy in any form as putting money in the bank, not taking some out. And think of your Texas bankruptcy lawyer not as someone who you write checks, but as someone who can help save your home and save you money.
How Much Does Texas Chapter 7 Cost?
June 14, 2010
You’re going to file bankruptcy because you have little to no income, so how can you be expected to pay for a lawyer and pay court fees?
Well, you’re not always filing bankruptcy because you’re flat broke. Sometimes you do it simply to consolidate, if not completely eliminate, debt which will take all the money out of your pocket to pay creditors. If you are low on cash, you might wonder if you can do this whole process yourself. Even if you have money, you may wonder exactly how much this process will cost you. Let’s find out.
Texas Chapter 7 – Costs
To file for Chapter 7 bankruptcy anywhere in the country, you will pay a court fee of $299. Chapter 13 will cost you $274.
Now, hiring a lawyer is where the price can seem high. A typical Texas Chapter 7 case will cost from $1,000 to $2,500. That may seem quite high, but because the benefits themselves are so high, it’s more than worth it. A Texas bankruptcy lawyer saves you time and money, does not take it. This is usually a flat rate for all filers. Also, many lawyers are willing to negotiate payment, if not also setting you up on a payment plan. Few can just pull $2,000 out of the bank, but if you can eliminate $20,000 in debt, that’s a whole different story.
Benefits of Texas Chapter 7
Most are eligible for Chapter 7 bankruptcy, most can discharge the majority of their debt, and you likely won’t lose any assets. Many filers believe they might lose their car or home. This does occur, which is why a lawyer handling your case is more than worth it. With an experienced lawyer, you can stop a foreclosure on your home, set up a payment plan on your home and car, and keep most other assets.
Say you have $20,000 in credit card debt; you can discharge all this money for a fraction of the total. Or say you have over $100,000 in medical debt from when you were hurt and did not have insurance; in this case, Chapter 7 is you best option and the fees seem minor.
Chapter 7 bankruptcy allows for you to be free of most debt, and there is no fine print. You can in some cases lose assets, and certain forms of debt cannot be included, but really it can be a life changing decision.
Can you do it yourself?
Technically you could operate on yourself, but few try that. Yes, you can handle a bankruptcy by yourself, sometimes even with success. It just depends on your situation. In some cases, it’s very understandable to forgo a lawyer, but when your entire financial future is on the line, you might want to be careful. The benefits of hiring an experienced bankruptcy lawyer are known the the thousands who successfully file in Texas every year.
How should you hire a Texas bankruptcy lawyer?
Hiring an experienced Texas bankruptcy lawyer is the first step in filing Chapter 7. If you want to discharge the majority of your debt, protect your assets, and be free of creditor harassment, it’s a wise choice. If you’re in the Dallas/Fort Worth area of Texas, we can handle your case.
What is Texas Joint Bankruptcy?
May 24, 2010
If you’re interested in filing joint bankruptcy, it’s time to call an experienced attorney. Why? Joint bankruptcy is different from traditional bankruptcy, and has different laws. This post, however, is a very good start on learning the basics.
What is Texas joint bankruptcy?
In Texas, the laws are a bit different as it is in each state, namely via consideration of eligibility. Depending on your family size, if you want to file under Chapter 7 you must meet eligibility requirements. If not, you can file Chapter 13. We’ll go over both in this piece.
Here are the current median incomes for Texas.
1 person – $38,801
2 Person Family – $55,660
3 Person Family – $59,011
4 Person Family – $66, 145
If you have a larger family, the rates increase.
What is Chapter 7 joint bankruptcy?
Chapter 7 is a liquidation proceeding where you discharge debts. That means, on paper, you will be eliminating the majority of your debts –such as credit card, mortgage, and medical bills — and getting a fresh start. For joint bankruptcy, filing together can save you some time and money. If you file together, all your joint debts are eliminated. However, if you choose not to file with your spouse, you can. The spouse will still be responsible for his or her debts in this instance.
Filing jointly is a very simple process an experienced Texas bankruptcy attorney can help with. Not only can you save time and eliminate debts, but the filing fee, which is $299, will only occur once (small, but it’s money). You can also save time on paperwork.
If on the other hand you are recently divorced, you may want to go it alone and let the former spouse handle his or her debts separately. This can be problematic if the divorce and financial considerations are not resolved.
If you want to file joint Chapter 13 bankruptcy, you must first meet federal eligibility requirements, which allow most everyone to file unless you have hundreds of thousands in debt (in that case, you definitely need to contact a lawyer for some expert help). Chapter 13 bankruptcy does not discharge debts, but if for example you just lost your job and the spouse is paying the majority of bills, it can be considered to buy you extra time to find more work.
What are the advantages of each bankruptcy?
Advantages of Chapter 7
-Discharge the majority of your debts.
-You have the option to file jointly or individually.
Advantages of Chapter 13
-You can rework your bills so you can afford them.
-You can file together and stop a home foreclosure.
There are disadvantages to filing bankruptcy in the first place, such as being on your record for up to 10 years. Also, if you or your spouse is fine and needs no bankruptcy, jointly filing will be on the credit report.
In the end, filing Texas joint bankruptcy requires the expertise of an experienced attorney who can go over the details of your case and offer advice.
6 Myths of Bankruptcy
May 19, 2010
Filing bankruptcy ruins your credit … you’ll never be able to get a credit card or loan again … and your possessions will all be taken.
Or: your debts will all fly away, your home will be safe no matter how far behind on payments you are, and your credit will improve.
With some creativity, you likely could come up with your own common “myths” of bankruptcy. But there is nothing wrong with mistaking the benefits and negatives of filing bankruptcy. These are all common online.
This posts shows you 6 myths you no longer need to believe. Some you may know, but read on, because some may surprise you.
1-You’ll Lose Everything
In most Chapter 7 bankruptcy cases, actually over 90 percent, you lose absolutely no assets. And the point of Chapter 13 bankruptcy is that you pay over an extended period so you lose nothing. The myth is that you 1) will lose your home and car and 2) you won’t be able to get them back. In fact, if you work with a trustee in the rare case you might lose something, you can negotiate to keep items such as your car. With Chapter 13, you can put an automatic stay on your home and stop any foreclosure proceedings if you are not too far behind.
2-You’ll Eliminate All Debt
Taxes, alimony, and child support cannot be eliminated. And with Chapter 13 bankruptcy, you are paying back everything, just typically over an extended period of time. Chapter 7 bankruptcy can eliminate credit, medical, and mortgage debt.
3-You won’t have to pay on your house
You still have to stay current on your home in order for the bankruptcy to work out. For instance, if you file Chapter 7, you can eliminate that debt, but you’ll lose the house. With Chapter 13, you must stay current on the mortgage or you’ll lose it.
4-Credit cards will no longer be an option
Let’s get back to the positives. Bankruptcy will stay on your credit report for, in most cases, 10 years. However, you will still get many offers for credit cards and you will have the opportunity to rebuild your credit. The interest rates on the credit cards may be high, but if you stay up on them it can be beneficial in rebuilding your credit.
5-Filing Bankruptcy Will Improve Credit Scores
Just because you eliminate debts with bankruptcy does not mean you get a clean slate. As noted above, a bankruptcy will show up on your credit report for 10 years. It’s not going to ruin you, but it certainly won’t improve your credit.
6-You won’t be able to make large purchases
You can still make purchases. Just because you file bankruptcy does not mean all options are off the table. You can still get credit cards, loans, and buy properties. You may have to work on rebuilding your credit, but if everyone who filed bankruptcy could never make a large purchase again there would be far less car and home owners.
Common Questions on Chapter 7 Bankruptcy in Texas
May 12, 2010
There are are many important questions when it comes to filing personal bankruptcy, so here on Higgins and Associates Texas law blog, we’ll be answering common questions.
For this post, let’s focus on Chapter 7 bankruptcy. What it is; how much it costs with lawyer fees; what you need to do to file; if you’re eligible, and more.
What is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy is the most common form of bankruptcy for filers who want to eliminate debt. You will file with the courts, usually and preferably with the help of a lawyer, and a trustee will be appointed. A “trustee” is someone who handles the liquidation of any nonexempt assets. Your car or some other asset may be worth more.
Do you always lose assets with Chapter 7 bankruptcy?
One of the disadvantages of Chapter 7 is that you may lose some assets. In bankruptcy, the less you have the less you lose. If you are jobless, rent an apartment, and have few assets, in most cases you lose nothing. There are many other ways where you lose nothing, even if you have a job, home and assets. In fact, most bankruptcy filers, of all situations and various income levels, typically lose nothing by filing. If your assets are valued too high, you might file under Chapter 13.
What is the difference with Chapter 13?
Chapter 13 is a debt repayment plan; you don’t discharge debts, you pay them back over time. Chapter 7 means you discharge (eliminate) many forms of debt. So you pay with Chapter 13, and not with Chapter 7. However, if you make a lot of money and/or have many assets, Chapter 13 lets you keep them.
What are the advantages?
We kind of pointed out how Chapter 7 can discharge debts, but what debts? You can discharge mortgage, credit card, and medical bills. You can’t discharge taxes, alimony, and child support. If you have thousands in credit card debt, Chapter 7 is a very good option. It should be noted, you can eliminate mortgage debt, but you will lose your home in this case unless you can pay it.
Are you eligible for Texas Chapter 7 bankruptcy?
In order to file Chapter 7 bankruptcy, you must be eligible. In order to be eligible, you need to be below the median income for households in Texas.
Texas Median Income
1 Person Family – Annual Income $38,801
2 Person Family – Annual Income 55,660
3 Person Family – Annual Income $59,011
4 Person Family – Annual Income $66,145
And it goes up if you have larger families than this. If you make too much, under new Bankruptcy Code you can still file Chapter 13. Chapter 13 has definite advantages that an experience Texas bankruptcy attorney can help you with.
How much does it cost?
Chapter 7 bankruptcy costs $299 and Chapter 13 $274, in any state including Texas. Lawyer fees can range in variety, but typically are from $1,000-$2,000. Higher price does not always mean they’re an expert. Be thorough in reviewing bankruptcy lawyers.
Who should you hire?
You have all the answers you need but one: who should you hire? A Texas bankruptcy lawyer helps you fill out documentation, claim exemptions, stop creditor harassment, and gives you a fresh start financially. Hire a lawyer who cares about his or her clients, who has the time to handle your case, specializes in personal bankruptcy, and has a fair price.
Dallas Bankruptcy Process — What to Expect at Your Bankruptcy Consultation
June 2, 2009
What should you expect when you come to Higgins and Associates for your Bankruptcy Consultation? This short video explains the bankruptcy process for people filing bankruptcy in Dallas Fort Worth.
How can a debtor minimize the amount of money or property that must be turned over to the trustee in a chapter 7 case?
March 28, 2008
In a chapter 7 case the debtor is required to turn over to the trustee only the nonexempt money or property that he or she possessed at the time the case was filed. Many nonexempt assets of consumer debtors are liquid in nature and tend to vary in size or amount from day to day. It is wise, therefore, for the debtor to engage in some negative estate planning so as to minimize the value or amount of these liquid assets on the day and hour that the chapter 7 case is filed. The most common nonexempt liquid assets, and the assets that the trustee will be most likely to look for, include the following:
(1) cash,
(2) bank accounts,
(3) prepaid rent,
(4) landlord and utility deposits,
(5) accrued earnings and benefits,
(6) tax refunds, and
(7) sporting goods.
It is usually advantageous for the debtor to take steps to insure that the value of each of these assets is as low as possible on the day and hour that the chapter 7 case is filed. By doing this the debtor will not be cheating or acting illegally; the debtor will simply be using the law to his or her advantage, much the same as a person who takes advantage of loopholes in the tax laws.
Cash. If possible, the debtor should have no cash on hand when the chapter 7 case is filed. Further, if the debtor has received cash or the equivalent of cash in the form of a paycheck or the closing of a bank account shortly before the filing of the case, the debtor should obtain receipts when disposing of the funds in order to prove to the trustee and the court that the funds were disposed of prior to the filing of the case. Money possessed by the debtor shortly before the filing of a chapter 7 case may be spent on such items as food and groceries, the chapter 7 filing fee, the attorney’s fee in the chapter 7 case, and the payment of up to $600 to creditors whom the debtor intends to continue paying after the filing of the chapter 7 case. Payments should not be made to friends or relatives, however, as the trustee may later recover these payments.
Bank Accounts. The best practice is to close out all bank accounts before filing under chapter 7. If a bank account is not closed, the balance of the account should be as close to zero as the bank will allow and all outstanding checks must clear the account before the case is filed. If the debtor has written a check to someone for, say, $50 and if the check has not cleared the account when the case is filed, the $50 in the account to cover the outstanding check will be deemed an asset of the debtor and will have to be paid to the trustee.
Prepaid Rent. If the debtor’s rent is paid on the first day of the month and if the debtor’s chapter 7 case is filed on the tenth day of the month, the portion of the rent covering the last 20 days of the month, if not exempt, will be deemed an asset of the debtor and will later have to be paid to the trustee. If possible, the debtor should make arrangements with the landlord to pay rent only through the date that the case is to be filed and to pay the balance of the rent from funds acquired after the case is filed. If this is not possible, the case should be filed near the end of the rent period.
Landlord and Utility Deposits. Unless they are exempt, the debtor should attempt to obtain the refund of all landlord and utility deposits before filing a chapter 7 case. Otherwise, the deposits, or their cash equivalents, will have to be paid to the trustee.
Accrued Earnings and Benefits. In most states, and under the federal law, only a certain percentage (usually 75%) of a debtor’s earnings are exempt. Therefore, the trustee may be allowed to take the nonexempt portion (usually 25%) of any accrued and unpaid wages, salary, commissions, vacation pay, sick leave pay, and other accrued and nonexempt employee benefits. Normally, then, the best time to file a chapter 7 case is the morning after payday. Even then, if the pay period does not end on payday, the debtor may have accrued earnings unless special arrangements are made with the employer. If annual leave or vacation pay is convertible to cash, it should be collected by the debtor before the chapter 7 case is filed, as should any other nonexempt employee benefits that are convertible to cash.
Tax Refunds. In most states, a tax refund is not exempt and becomes the property of the trustee if it has not been received by the debtor prior to the filing of a chapter 7 case. Therefore, if the debtor is scheduled to receive a tax refund, a chapter 7 case should not be filed until after the refund has been received and disposed of. Even if the case is filed before the end of the tax year, if the debtor later receives a refund, the trustee may be entitled to the portion of the refund earned prior to the filing of the case. The best practice, then, is to either file the chapter 7 case early in the tax year (but after the refund from the previous year has been received) or make arrangements to insure that there will be no tax refund for that year.
Sporting Goods. If the debtor owns guns, fishing gear, skis, cameras, or similar items of value that are not exempt, he or she will later have to mm them, or their cash equivalent, over to the trustee. Such items should be disposed of prior to the filing of the case, especially if they are of considerable value.
Under what conditions should both spouses file under chapter 7?
March 28, 2008
Both husband and wife should file if one or more substantial dischargeable debts are owed by both spouses. If both spouses are liable for a substantial debt and only one spouse files under chapter 7, the creditor may later attempt to collect the debt from the nonfiling spouse, even if he or she has no income or assets. In community property states it may not be necessary for both spouses to file if all substantial dischargeable debts are community debts. The community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, and Washington.
What secured property may a debtor retain or redeem in a chapter 7 case?
March 28, 2008
A debtor may retain and redeem certain secured personal and household property, such as household furniture, appliances and goods, wearing apparel, and tools of trade, without payment to the secured creditor, if the property is exempt and if the mortgage or lien against the property was not incurred for the purpose of financing the purchase of the property. A debtor may also retain and redeem without payment to the secured creditor any secured property that is both exempt and subject only to a judgment lien. Finally, a debtor may redeem certain exempt personal, family, or household property by paying to the secured creditor an amount equal to the value of the property, regardless of how much is owed to the creditor. Deadlines are imposed on the enforcement of these rights by the debtor during the bankruptcy case.