Bankruptcy in Butte, MT

Are financial struggles weighing you down, pushing you toward the brink of bankruptcy? You’re not alone. In the face of mounting debt and uncertainty about the future, seeking legal help can provide a lifeline. 

Join us as we explore the essential steps to take in Butte. From understanding your options to navigating the legal process, we’re here to empower you to make educated decisions.

Types of Bankruptcy in Butte, Montana

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 Butte, MT 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.

Bankruptcy cases from Butte go to the U.S. Bankruptcy Court for the District of Montana. This court serves the entire state and has locations in Billings, Butte, and Great Falls.

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 Butte  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.

While Chapter 7 bankruptcy offers a relatively quick discharge of debts, individuals facing certain circumstances may find other types of bankruptcy more suitable. Chapter 13 bankruptcy, for instance, allows debtors to restructure their debts into manageable repayment plans. Additionally, businesses seeking to continue operations in Butte might opt for Chapter 11.

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.

Qualifying for Chapter 11 bankruptcy typically involves meeting strict eligibility criteria. The primary focus is on proposing a viable reorganization plan. Unlike Chapter 7, businesses often use this type of bankruptcy to manage overwhelming debts. To qualify, the debtor must demonstrate willingness and ability to restructure and maintain regular operations.

Chapter 13 Bankruptcy

Chapter 13 Bankruptcy is a debt restructuring or wage earners plan. In Butte, MT 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 restructuring your debt with a three to 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 allow you to have some or most of your debts discharged.

For Chapter 13 bankruptcy, you must submit several forms to initiate the process. While specific requirements may vary, common forms for Butte residents include:

1. Petition for Bankruptcy (Official Form 101)
2. Voluntary Petition (Official Form 101A)
3. Schedule A/B: Property (Official Form 106A/B)
4. Schedule C: The Property You Claim as Exempt (Official Form 106C)
5. Schedule D: Creditors Who Hold Claims Secured by Property (Official Form 106D)
6. Schedule E/F: Creditors Who Have Unsecured Claims (Official Form 106E/F)
7. Schedule G: Executory Contracts and Unexpired Leases (Official Form 106G)
8. Schedule H: Your Codebtors (Official Form 106H)
9. Schedule I: Your Income (Official Form 106I)
10. Schedule J: Your Expenses (Official Form 106J)
11. Statement of Financial Affairs for Individuals Filing for Bankruptcy (Official Form 107)
12. Chapter 13 Plan (if not filed with the petition)
13. Certificate of Credit Counseling and Debt Repayment Plan (if applicable)
14. Proof of Income (pay stubs, tax returns, etc.)
15. Means Test Calculation (Form 122C-1 or 122C-2)

The Bankruptcy Process in Butte, Montana

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 Butte 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.

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 Butte, Montana Lawyer

Hiring a local bankruptcy lawyer in Butte 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 that can be discharged or can’t be discharged. An experienced Montana 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 Butte can guide you through the entire bankruptcy process. We can even help you connect with an attorney across Montana 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!