Bankruptcy in Bangor, ME

Are you contemplating bankruptcy or hiring a bankruptcy attorney in Bangor, Maine? Are you tired of creditors calling for payments you can’t make? Maybe looking for a way to get out of debt and have you exhausted all other options? Then bankruptcy might be the solution you seek. It is a legal option that can erase a portion or all of your debts.

Types of Bankruptcy in Bangor, Maine

Bankruptcy is a legal process that helps individuals and businesses get a fresh financial start. It eliminates a portion of or all of their debts or financial liabilities. In Bangor, ME to be approved, individuals must prove they have a hardship that prevents them from staying current on their financial obligations. Keep in mind that not all debts qualify. Some liabilities, such as child support arrears, delinquent taxes, alimony, and student loans generally do not qualify for discharge. Consumers who find themselves falling behind in debt can file either Chapter 7, 11 or 13. To determine which option is right for you, you’ll need to assess your goals, assets, and income. You should also consider working with an experienced bankruptcy attorney.

Bangor bankruptcies are under the jurisdiction of the US Bankruptcy Court, District of Maine. There is a courthouse located in Bangor at the MC Smith Federal Building.

Chapter 7 Bankruptcy

Many people find Chapter 7 to be the right solution for their circumstances because it provides them with the opportunity to start over financially. However, before filing for Chapter 7 bankruptcy, you should thoroughly assess your income and ability to repay what you owe. You should also speak with a bankruptcy attorney in Bangor  who can help you to decide if a liquidation plan is right for you.

Typically, individuals approved for Chapter 7 lack stable income or have experienced a change in circumstances that has resulted in an inability to manage their debts. Though Chapter 7 erases debts, the tradeoff is you may have to give up certain possessions, such as your home, car, or some other assets. However, once you file your petition, an automatic stay goes into effect that requires all collection activity against you like foreclosures and garnishments, to stop temporarily. However, the automatic stay does not prevent all collection attempts. For example, if you owe child support or restitution for a criminal case, you are still liable for those payments.

The US Bankruptcy Court, District of Maine describes Chapter 7 as “straight bankruptcy”. Information that Bangor residents will need to incorporate with an initial petition include:

  • List of all property
  • Amount, frequency, and source of income
  • Monthly living expenses, including food and clothing
  • List of creditors, including their addresses and nature of their claims

Before taking this step, state and federal governments require proof of credit counseling. For convenience, the US Department of Justice provides a list of approved credit counseling courses for use in Bangor.

Chapter 11 Bankruptcy

Chapter 11 bankruptcy is more complex than other types of bankruptcy. It is often used by businesses and certain types of people. It allows petitioners to restructure their debts with a reorganization plan, so they are easier to manage over a determined length of time, usually four to 18 months. The main benefit of Chapter 11 bankruptcy is that it does not require petitioners to sell off or liquidate their assets to pay what they owe. It does allow debtors to negotiate with their creditors a reorganization plan that enables them to stay current on their debts moving forward.

The US Bankruptcy Court, District of Maine describes Chapter 11 as a reorganization. This type of bankruptcy gives Bangor residents time to keep their financial hopes alive while paying debts. To start the process, you will need to file a number of forms including:

  • Voluntary Petition for Individuals Filing for Bankruptcy
  • List of creditors
  • A filing fee of $1,738

Chapter 13 Bankruptcy

Chapter 13 Bankruptcy is a debt restructuring or wage earners plan. In Bangor, ME after you file, the courts will assign a trustee to examine your liabilities and assets and ability to pay bills. Unlike other types of bankruptcy, Chapter 13 involves you restructuring your debt with a three to a five-year repayment plan. The flexibility of this repayment plan will depend on what property you want to keep and how steady your income is. It may also give you the opportunity to have some or most of your debts discharged.

According to the District of Maine, applying for Chapter 13 in Bangor creates an automatic stay for your debts. This step means that you have protection from lenders chasing after payments because their claims have been frozen. This action does have its limitations, however, and it does not last forever. In fact, creditors can file a Motion for Relief from the Automatic Stay. If the judge chooses to lift the stay, the harassing phone calls may start again for a Bangor debtor.

The Bankruptcy Process in Bangor, Maine

There is never an ideal time to declare bankruptcy. However, if you are unable to pay off what you owe within five years, filing for bankruptcy can help you to lessen the negative impact on your situation and help you get back on track.

In Bangor to begin the filing process, gather all of your financial records, including monthly expenses, debts, assets, and annual income. This information is crucial to give the courts an accurate picture of your circumstances. Failure to provide all necessary information can result in your petition being denied.

Maine legislation provides a variety of possible exemptions to use during a Bangor bankruptcy. A Bangor debtor may be able to exempt up to $47,500 in equity for their principal residence. Furthermore, this exemption increases to $95,000 if the debtor is over 60 years of age.

Other possible exemptions include:

  • $7,500 in motor vehicles
  • $5,000 in tools of your trade
  • $200  in clothing and home furnishings

At least six months before you file for bankruptcy, eliminate unnecessary spending. Do not run up the balances on your credit accounts. You’ll also need to complete an approved credit counseling course, usually online or over the phone. Credit counseling is necessary to help you learn financial literacy and help you learn better financial habits. Once you complete the course, you’ll receive a certificate of completion to include in your filing. If you don’t have the certificate of completion from the credit counseling course that you took, the courts will reject your bankruptcy petition.

Work With an Experienced Bangor, Maine Lawyer

Hiring a local bankruptcy lawyer in Bangor during this process can help reduce the costly risks of self-representation in court. An experienced bankruptcy lawyer understands state and federal bankruptcy laws. He or she can help you understand which laws apply to your case, especially which debts can be discharged or can’t be discharged. An experienced Maine attorney can also offer you guidance to improve the outcome of your case.

Keep in mind that there are debt management alternatives and financial resources that may benefit you more than bankruptcy, such as debt consolidation. Though bankruptcy is an attractive solution, it is best as a last resort. Do you need immediate help? Then one of our experienced lawyers in Bangor can guide you through the entire bankruptcy process. We can even help you connect with an attorney across Maine state lines.

Submit a request online or call us today at (866) 345-6784 to get in touch with an experienced lawyer in your area!

How It All Works

Call us or answer the questions on this site. Your category, location, and additional information will help us connect you to a legal professional and we’ll send you the results instantly.

Which Areas of Law?

We have attorneys in over 20 legal categories to choose from.

How Much Does This Cost?

We don’t charge you to be connected. Some legal categories require upfront fees while others do not. The legal professional will determine this with you before you commit to anything.