In 2005, the Bankruptcy Act was changed by Congress to make it easier to understand how the process of filing for bankruptcy in Georgia is completed. The Bankruptcy Act of 2005, set specific guidelines that must be adhered to during bankruptcy cases. Georgia bankruptcy lawyer Tyler Moffitt understands every aspect of this process and is here to help you.
What Kind of Bankruptcy Should I File?
One of the first steps you need to take is to determine what type of bankruptcy you can file for based upon your individual set of circumstances.
The 2005 Bankruptcy Act requires that your expenses and income both be subjected to a stringent analyzing to see if you meet the qualifications for a Georgia Chapter 7 bankruptcy, or if you should file a Georgia Chapter 13 bankruptcy.
The bankruptcy court will examine your average income for the last six months and compare it to the median income for the state of Georgia as part of a means test. If your average income is higher than the median income, the rest of the means test will be performed to see if you qualify for a Georgia Chapter 7 or whether you must file a Chapter 13 bankruptcy.
What is A Georgia Chapter 13 Bankruptcy?
There are very substantial differences between a Georgia Chapter 7 bankruptcy and a Georgia Chapter 13 bankruptcy.
A Georgia Chapter 13 bankruptcy involves you repaying your debts through a monthly payment plan. Your petition for Chapter 13 must include a copy of your proposed repayment plan. After any reasonable monthly expenses are paid, you must show the available money you have that can go toward paying off your debts and how you are going to divide that money between all of your creditors.
Secured debts, referred to as priority claims for such things as your mortgage, car payments, taxes, and back child support must be paid in full. Any unsecured debts such as credit cards, medical bills, etc., generally are only partially paid for sometimes as low as 10 cents on the dollar.
Your Chapter 13 repayment plan must pass three tests to make sure all unsecured creditors are paid the same as if you filed for a Chapter 7 bankruptcy.
Once you’ve filed for a Georgia Chapter 13 bankruptcy, your monthly payments will start and are normally automatically withdrawn from your earnings.
What is a Georgia Chapter 7 Bankruptcy?
In a Georgia Chapter 7 bankruptcy, a trustee will be appointed to your case to make sure your creditors are getting paid as much as possible. Any paperwork you submit to the court will be scrutinized carefully with special attention being given to any assets you may have or any exemptions that you filed. Any part of your case can be challenged by the Trustee.
The 341 Meeting of Creditors, which you have to attend, is the first meeting with all of your creditors. Usually, however, no creditors attend this meeting for a Chapter 7 bankruptcy, but one or two of them who have questions may choose to attend this meeting.
Generally, there aren’t any exemptions in a Chapter 7 bankruptcy case, and any non-exempt assets must be turned over to the trustee after the 341 Meeting of the Creditors.
Is There Any Property That Is Exempt From Being Seized in a Bankruptcy?
Before filing for a Georgia bankruptcy, your attorney will ask you to provide all pertinent documentation which will include an itemized proof of income, two years of major financial transactions, cost of living expenses, debts, and all property you own. This property is not just real estate.
You will also need to provide the last two years of tax returns, deeds for real estate, titles for any vehicles, and any loan documents. After receiving all these documents your Georgia bankruptcy attorney will assist you in determining what property is exempted according to Georgia’s exemptions.
How Will Bankruptcy Affect My Credit Score?
Many people believe that if they file for a Georgia bankruptcy, their credit score will be destroyed. In reality, filing for a Georgia bankruptcy may actually assist you in getting your credit rating back on the right path. You may even see your credit score jump as high as 700 within two years of your bankruptcy discharge.
However, if you don’t take any action, you may continue to have late payments and damage your credit score even more. To help you get your credit score back on the right track, contact Georgia bankruptcy attorney Tyler Moffitt so you can regain control of your financial situation.
If you believe that a Georgia bankruptcy is your only answer out of your financial difficulties, before you file for a Georgia Chapter 7 bankruptcy or a Georgia Chapter 13 bankruptcy, contact Georgia bankruptcy lawyer Tyler Moffitt. He can evaluate your individual financial situation and go over all your options with you so you can make an informed decision and get back on the road to financial security.