OH debtors encouraged to explore Chapter 7 bankruptcy
For many Americans, making ends meet on a daily basis can be difficult. Whether facing overwhelming credit card debt or extensive medical bills, some Ohio residents simply aren’t able to keep up with their financial demands. Through the years, bankruptcy has held a certain stigma of being a financial mistake and something to avoid at all costs. Yet, bankruptcy continues to be a valid option for people who are stuck beneath a pile of debt and expenses.
Chapter 7 continues to be the most common form of bankruptcy, with Chapter 13 coming in second. Last year alone, over one million Americans filed for bankruptcy. Approximately 728,833 of those were classified as Chapter 7, according to the U.S. federal courts. Why is Chapter 7 the most popular type of bankruptcy? Although it is more difficult to qualify for, people have the ability to discharge much of their debt through a Chapter 7 bankruptcy, allowing them to have a clean financial start.
Qualifying for liquidation bankruptcy
Not everyone can qualify for Chapter 7, otherwise known as liquidation bankruptcy. Debtors must have an income that is below the state median, which in Ohio is $77,500 for a family of four, according to the U.S. Department of Justice. People who make more than this amount may still qualify by passing a means test, which will calculate the amount of money a debtor has after all expenses are paid. Another prerequisite to filing for Chapter 7 is enrollment in an approved credit counseling course and payment of all required court fees.
Attending the meeting of creditors
After the bankruptcy documentation is filed, the trustee assigned to the case will organize a meeting of creditors. All creditors involved in the case are invited to air their grievances about the case. The debtor is required to attend and answer all of the trustee’s questions honestly, as well as present any documentation asked for by the trustee. The trustee will then review the case and determine whether the debt will be discharged. The trustee is also responsible for liquidating the debtor’s assets and dispersing them to the creditors.
Contacting a legal professional
Filing for bankruptcy is not for everyone; however, it can be a life-changing experience for those who are in desperate need of financial solace. A bankruptcy attorney can help by giving essential information regarding the bankruptcy process.