Chattanooga Bankruptcy Lawyer | Non-Dischargeable Debts
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Chattanooga Bankruptcy Lawyer

It does not take much for the average person to accrue unmanageable debt. In today’s economy, you may experience severe financial stress as more people lose their jobs during a pandemic and subsequent economic shutdown. You can, however, reach out to a Chattanooga bankruptcy lawyer today for information on how declaring bankruptcy could help you recover some semblance of balance and control. Contact a compassionate declaring bankruptcy attorney who stands ready to help you start over.

How Bankruptcy Works

When debt overwhelms people or businesses, they are often able to file for bankruptcy and receive immediate relief from creditors. A bankruptcy filing imposes an “automatic stay” on all creditors, and so, they cannot garnish wages, deduct money from financial accounts, or seize secured assets. While bankruptcy relieves debts, parties are still responsible for some form of repayment, and certain debts that are unaffected by the declaration. Often, however, people find immediate relief from creditor harassment a welcomed reprieve. With the help of a Chattanooga declaring bankruptcy lawyer, you could obtain such relief.

Is There More Than One Way to Declare Bankruptcy?

There are two types of bankruptcy filings that are relevant to most people looking to file. Chapter 7 is the most common form of personal bankruptcy. There are, however, income limits on Chapter 7 filings and a relatively quick liquidation of assets and discharge of debts. Chapter 13, on the other hand, is called “reorganization.” In a Chapter 13 bankruptcy filing, debtors are able to keep most of their assets and follow a court-ordered repayment plan. This is generally appropriate for people with regular income who do not qualify for Chapter 7 bankruptcy. When filing for bankruptcy, a Chattanooga filing for bankruptcy lawyer could ascertain which type is suitable and apply for immediate relief.

With a Chapter 7 filing, the court will appoint a trustee who will review the supporting documents, sell any nonexempt property, and pay back creditors. If there is no nonexempt property to sell, creditors get nothing. Courts do not sell assets in a Chapter 13 bankruptcy filing. A debtor must follow the repayment plan, usually over a three to five-year period. When declaring bankruptcy, a law firm with experience handling bankruptcy cases could help gather the documentation necessary for the trustee’s review

A bankruptcy lawyer preparing people for filing could administer a government-required test of a person’s means, review all assets and inventory, outline debts, income, and assets, complete and submit the petition, attend creditors’ meetings, and receive the notice of discharge of debts.

Debts That Can and Cannot Be Discharged in Bankruptcy

Bankruptcy filings do not forgive all debt. Federal and state law requires continued obligation for certain kinds of debt. However, the law protects some assets from sale during a bankruptcy proceeding. Exempt property includes things like a vehicle, tools of a trade, wedding rings, some personal property in a home, and a certain amount of home equity.

Dischargeable Debts

A bankruptcy filing can relieve most unsecured debt (debt that is not backed by collateral). For example, the types of debt immediately discharged include medical bills, credit card and utility bills, charges from collection agencies, personal loans, business debt, and overdue rent. The trustee would sell any nonexempt property to pay these creditors, but in practice, there is rarely enough money to do so.

Non-Dischargeable Debts

A bankruptcy law firm knows which debts are not dischargeable, including child support and alimony payments, student loans, court fines, penalties and criminal restitution, overdue taxes, and debts owed to government agencies.

Reach Out to a Chattanooga Bankruptcy Attorney for Help

Though filing for bankruptcy may seem extreme, it can give you immediate relief from an overwhelming amount of debt as well as creditor harassment. A Chattanooga bankruptcy lawyer could help you through a difficult time, paving the way for a new start. With so many people feeling the crush of a failing economy, bankruptcy can be the relief and support you need right now. Call today.

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