Prichard, AL Chapter 7 Bankruptcy Attorneys

Financial challenges are often just a job loss or medical emergency away, even for the most financially stable family. When financial woes become too much to bear and an ever-growing share of your monthly income is going to debt payments, it may be time to consider Chapter 7 bankruptcy in Prichard, AL. It’s a viable solution that has given many families a fresh start and much-needed breathing room as they regain their footing.

Wondering if bankruptcy is the right option for you? The team at Padgett & Robertson understands the many factors driving your decision, and we’re committed to helping you make the best choice for your family. Call us at 251-336-3695 to set up a time to meet with our team.

What is Chapter 7 Bankruptcy?

Known as liquidation bankruptcy, Chapter 7 bankruptcy is what most people think of when they think of this legal process. When a Chapter 7 bankruptcy makes it through the process, the filer’s qualifying debts are discharged. Note, though, that not all debts are dischargeable. For example, student loans, most forms of tax debt, and child support cannot be discharged in bankruptcy.

The filer goes through the process of providing their detailed financial information, listing out their debts and assets, and having their file looked through by the trustee. If they have assets that cannot be exempted, the trustee will sell those assets and use the proceeds to make partial payments to creditors.

Upon completion of the final court date, the borrower’s dischargeable debts are wiped clean and they can turn the page.

Eligibility and Requirements in Prichard, AL

Getting your Chapter 7 bankruptcy granted does require that you clear several hurdles. To start, you will need to pass a means test. Filers who earn too much may not be able to file for Chapter 7 bankruptcy; however, Chapter 13 may still be available to them. If a filer earns less than the median income in Alabama, they are typically eligible. Even if their income exceeds the state median, they may still qualify if their disposable income falls below a certain amount.

You must also go through credit counseling in order to get your discharge granted. The courses required by the bankruptcy court aim to teach filers about financial security, responsible use of debt, and budgeting.

Depending on the assets you have, you may have to turn some of them over to get your bankruptcy granted. Most filers in Prichard do not have to give up anything, so discuss your concerns with your attorney before jumping to conclusions.

Bankruptcy Exemptions in Alabama

Each state has its own list of exemptions. This ensures that people filing for bankruptcy are not left destitute after being forced to sell off all of their personal possessions. You can use Alabama’s exemptions as long as you have been a resident for at least two years. Exemption amounts are updated regularly to account for inflation.

As of April 2021, homeowners can exempt up to $16,450 of their home’s equity. There is also a personal property exemption that can be used to protect anything up to $8,225. This is known as the wildcard exemption, and it allows you to protect anything not accounted for in other categories. You may use it to protect your vehicle, household goods, or furniture, for example. Unlike many other states, Alabama does not have a vehicle exemption, so many filers use the wildcard exemption to keep their car.

Some assets are protected from seizure regardless of their value. These assets include burial plots, a church pew, equipment used for work, and workers’ compensation benefits.

What to Expect from This Process

When you look over the bankruptcy process, you may feel overwhelmed and uncertain. That’s common, so don’t panic. Our team will be with you every step of the way so you always know what’s coming next and what you need to do. Once you provide the necessary documentation and paperwork, we will file for Chapter 7 bankruptcy. This puts the automatic stay into effect, which prevents creditors from attempting to collect payments from you. This alone is often a huge relief for families that have been living with constant calls for months.

From there, you will need to complete your credit counseling course and prepare for your meeting of creditors. This is also known as a 341 meeting and is generally held fairly quickly after filing. While it is called a “meeting of creditors,” it is rare for creditors to appear. When you appear, you’ll need to answer a series of questions from the trustee. These questions generally verify your employment, assets, and the information included in your initial documentation.

If the bankruptcy court approves the case, your debt will be discharged.

How We Can Help You

Bankruptcy is not just a legal process. It is a choice with significant personal and financial repercussions, and we understand that many people only choose bankruptcy after doing everything in their power to pay their debt off on their own. People come to us with a wide range of concerns and questions, and our goal is to make this process as easy on you as possible. You can rely on us for judgment-free guidance, personalized advice regarding your bankruptcy case, and support as you work toward a fresh start.

Whether you have already decided that bankruptcy is definitely the right choice for you or you are still weighing your options, we’re happy to meet with you and discuss your thoughts. We aren’t here to push you into something that is not right for your finances or your family. We are here to help you explore your options and support you from there.

If bankruptcy is on the table, turn to Padgett & Robertson for the knowledge and experience you need.

Call Our Team of Prichard, AL Bankruptcy Lawyers Today

As you consider what your financial future may look like, find out how the team at Padgett & Robertson can help you. Call us at 251-336-3695 or reach out online to set up a meeting now.