It is not uncommon when facing the idea of filing for bankruptcy to have a myriad of emotions. Some people feel so overwhelmed that they get frozen and can’t do anything about their situation. Most people are embarrassed and feel alone. Rest assured, you are not alone. Thousands of cases are filed every day across the country and it is almost guaranteed that someone has the same story.
Bankruptcy Case Studies
- Young, married couple ages 25-30 with one child. They are renting and have 2 car payments. They started off with 2 incomes until they had their child at which time they decided daycare costs did not offset income earnings. With a yearly household income of less than $30,000, credit cards were a way to help make ends meet for basic needs. But when it became too hard to make payments, the calls started coming and the debt became overwhelming. Their income is below the $42,000 means test qualification and this means they can file for a chapter 7 bankruptcy. They can each claim a $5,000 exemption towards their personal property and a $1,000 exemption each toward equity in their vehicles for total exempt assets of $12,000. But in this case, they owe money on their vehicles so they can just continue making their payments and keep their vehicles. They can file the bankruptcy, discharge their debts, and be done in about 90 days after filing getting a fresh start.
- A married couple between 45-50 with a house that has a higher mortgage. They are being served a foreclosure lawsuit. They have a household income of $85,000. They can get a stay by filing for bankruptcy and entering into a Chapter 13 payment plan while keeping their house.
- A 64-yr-old woman who spent most of her time as a single mom with 3 children was taking care of her father until he passed. She is in the middle of probate to sell her father’s house. She incurred 27k Credit that just kept rising to pay for unexpected life events including 8k in medical after a fall. She has a judgment against her. Since she will be receiving a judgment, she should file a chapter 13.
- Previously well-paid and doing very well, a divorce led a 50-year-old woman to 50k in credit card debt. She has a paid-for Jeep Patriot worth $4800, a BMW that doesn’t run worth $5,000, and an Audi $6,000. She can sell the BMW, use an exemption for the Audi, and do a buyback agreement with the trustee in order to keep the Jeep.
There are just a few examples of people who have found themselves in a tough situation. Most of the time, these situations arise due to uncontrollable circumstances. If you are considering bankruptcy, you should know that there are many options available. There is an answer to your bankruptcy questions. Reach out to us today and let us help you take the next step. Filing for bankruptcy is not an easy decision, but it may be just the answer to getting back on your feet.
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Do I qualify for the means test?
