Even when properly planned, bankruptcy can be a stressful process. However, taking the time to weigh the various options is the only way to make an informed decision. Below are a few things to know before hiring a chapter 7 attorney in Martinsburg, WV.
Discharge Really Eliminates Some Debts
If a client has trouble repaying their debts, filing for bankruptcy can give them the fresh start they need. A chapter 7 discharge removes unsecured debts such as medical bills and credit card debt. A client is eligible for discharge when they pass a means test, which proves that they don’t have enough income to cover repayment and living expenses. Only the debts listed in the petition are discharged.
Chapter 7 Can’t Eliminate All Debt
Though discharge can remove a client’s obligation to repay certain debts, it can’t eliminate all of them. Some debts that can’t be eliminated are student loans, child and spousal support, income taxes from the last three years and criminal fines. For other obligations, a creditor must ask the bankruptcy court to determine whether or not the debt is dischargeable.
Filing Has a Price
When a client files for chapter 7, they must pay fees for filing and credit counseling. Additionally, it may cost thousands to hire a chapter 7 attorney in Martinsburg, WV. Though such costs can be daunting, it shouldn’t prevent a client from filing if they think a discharge is the best chance for a clean financial slate.
Filing Has Temporary Consequences
Bankruptcy has some repercussions, particularly on a client’s credit score, which can drop by up to a hundred points depending on the debt to be discharged. A chapter 7 bankruptcy can remain on a client’s credit report for ten years, which can prevent them from getting credit or a low-rate loan.
Is Chapter 7 the Right Decision?
Though bankruptcy has some consequences, it can be a great relief and an ideal way to start over. With these considerations in mind, a client may find that chapter 7 is the right choice. Consult an attorney with Sherman Law Firm for legal counseling and bankruptcy advice.
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