Bankruptcy in Georgia
Are you contemplating bankruptcy or hiring a bankruptcy attorney in Georgia? 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 Georgia
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 Georgia, 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.
You may have to attend hearings at the United States Bankruptcy Court of the North District of Georgia during this process.
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 Georgia 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 United States Bankruptcy Court of the District of Georgia has dozens of forms you may need to complete for Chapter 7. You’ll want to start with a Voluntary Petition for Individuals or non-individuals for businesses. A critical part of the process that follows is known as means-testing. You can find information and instructions from the courts, but the IRS may get involved to report on your income for previous years.
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.
In some cases, federal law gives courts the authority to complete an involuntary Chapter 11 bankruptcy in Georgia. Otherwise, the U.S. Courts say that you can start by filing a petition and sending requisite financial information. Failure to submit correct information can result in a denial, so having an attorney may save you valuable time and money in the end.
Chapter 13 Bankruptcy
Chapter 13 Bankruptcy is a debt restructuring or wage earners plan. In Georgia 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 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.
Eligibility for Chapter 13 depends on the amount of your secured and unsecured debts. Individuals with less than $1,184,200 and $394,725 respectively may qualify. Failure to include the correct fee or opening paperwork can result in a denial of your petition. While each situation may differ, the courts typically need to see:
- Monthly expenses
- List of creditors, the nature of their claims, and the amounts
- The source, amount, and frequency of income
- List of all the debtor’s property
The Bankruptcy Process in Georgia
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 Georgia 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.
Filing for bankruptcy in Georgia does not leave you without any personal assets. Exemptions exist under current legislation that protects property up to a limit. Some examples from the law to consider include:
- $21,500 to $43,000 for homesteads
- $5,000 in motor vehicles
- $500 worth of jewelry
- Public benefits such as workers’ compensation or Social Security
- $5,000 in crops, animals, clothing, appliances, and 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 Georgia Lawyer
Hiring a local bankruptcy lawyer in Georgia 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 Georgia 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 Georgia can guide you through the entire bankruptcy process. We can even help you connect with an attorney across Georgia 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!