Our Bankruptcy Legal Services
Olympia Bankruptcy Lawyers
Chapter 7
Chapter 13
Our Olympia bankruptcy attorneys provide Chapter 7 and Chapter 13 debt relief throughout Pierce County, WA.
Filing for bankruptcy is a very difficult choice to make for most people. Usually people who file bankruptcy have considered every other option first. Even if you think you will avoid filing bankruptcy, it is good to learn what bankruptcy can do for you as you try other options. Our Olympia bankruptcy attorneys want you to understand your legal rights under the Federal and Washington State bankruptcy laws.
Bankruptcy is an orderly, legal way for people who have no way to climb out of debt to get a fresh start. If you can see that, at the going rate, you will never be able to be debt free, you could qualify for bankruptcy. Many people get into this situation because of an unexpected, unfortunate event such as an illness or a divorce. Some people simply overestimate their future earning capacity.
Often it is a combination of both. Most people try to make careful, rational decisions to better themselves over time but the world is not always predictable and rational. Big businesses know this. Consumer bankruptcy is there for honest people like you who are just trying to work and live, but who get caught up in financial troubles that they simply could not realistically predict, or perhaps did not predict because everybody is capable of mistakes.
Many people think that a bankruptcy will be a personal disaster. Though it is far from pleasant, it allows you a fresh start without having to lose everything. You can eliminate debt and keep a house, a car, a retirement account, household goods, work tools – the kind of property needed for a real fresh start. Most people are surprised to learn just how much property you can keep in a bankruptcy.
If you qualify, our Washington State bankruptcy lawyers can stop all creditor harassment and debt collection actions immediately.
The second you file a bankruptcy, all debt collection stops. That means that immediately all phone calls, lawsuits, garnishments, threats of repossession and foreclosure all stop. Just knowing how bankruptcy works can eliminate a lot of worry for most people. Once you have decided to file bankruptcy, you know what debt can be eliminated and you can stop making payments on that debt without worry.
The end result of a bankruptcy is called a discharge. That’s an order preventing creditors from trying to collect the debt. They can be sanctioned if they violate this order, so it basically cancels or eliminates most kinds of debt. Our bankruptcy attorneys can help you to understand exactly how a discharge happens and works when we help you to determine whether or not you can qualify bankruptcy relief in Washington State.
Some debt can not be discharged, such as fines, student loans, some taxes and domestic support obligations such as child support. For debts like mortgages or car loans, you can walk away from the debt if you give up the property or you can keep the property if you make payments on the debt.
More about filing a consumer bankruptcy in Washington State.
There are two kinds of consumer bankruptcy. One kind is a Chapter 7. This bankruptcy is known as a liquidation bankruptcy. That means in some relatively rare cases, property is taken from the debtor to be liquidated, or sold and converted to cash. The money is then distributed to the creditors fairly.
Most people who file Chapter 7 do not lose any property because the law allows them to keep it under the bankruptcy exemptions. These exemptions allow people a meaningful fresh start by allowing them to keep homes, cars, retirement plans and other property that is necessary to go forward in life.
To file a Chapter 7, a debtor can not have the ability to pay creditors in a payment plan. Bankruptcy laws measure the debtor’s income to determine whether it is enough to pay at least some percentage of the debt. If a debtor makes over the median income in their state, considering how many people live in the household, then he or she is subjected to a means test.
The means test deducts reasonable expenses (according to the IRS code) from the average income of the last six months. If there is money left over, there is a presumption that the debtor is abusing the bankruptcy system. This presumption can be overcome with special circumstances, but if not the case would be dismissed or converted to a Chapter 13. Our Olympia bankruptcy lawyers can help you to determine whether or not filing a Chapter 7 or a Chapter 13 bankruptcy is the right option for you and your family.
A Chapter 13 is a debt repayment plan. The plan consolidates debt and allows a debtor to repay it over three to five years. It allows a debtor to get caught up on a mortgage, pay car loans, get caught up on back child support or taxes and pay pennies on the dollar for debts like credit cards or medical bills. It is designed to allow the debtor to pay what he or she can using his or her best efforts. After the debtor pays what is reasonable, the debt that is not paid is discharged.
Some debtors have to file a Chapter 13 because of income. Some may want to because Chapter 13 allows debtors to keep property that could be lost in a Chapter 7. It also allows debtors a way to save a house from foreclosure. You can strip a second mortgage off a house in a Chapter 13, if the house is worth less than the first mortgage balance.
You can get relief with car payments too. Basically a Chapter 13 can do more but the downside is that you have to complete a payment plan before you get your discharge.