Bankruptcy in Rutland, VT

The weight of mounting debt can feel like a never-ending nightmare. However, there are ways to regain control.

Yet, the bankruptcy process is more than just filling out forms. It is a complex legal procedure that impacts the rest of your financial journey.

Navigating this alone can be akin to walking through a minefield blindfolded. Fortunately, a qualified bankruptcy attorney in Rutland can be your guide.

Types of Bankruptcy in Rutland, Vermont

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 Rutland, VT 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.

Most bankruptcy cases from Rutland go through the U.S. Bankruptcy Court for the District of Vermont. This federal court specializes in these proceedings.

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 Rutland  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.

Nonetheless, Chapter 7 bankruptcy is not suitable for everyone in Rutland. For example, Chapter 13 bankruptcy can protect valuable assets like your home or car. Furthermore, you do not have to liquidate assets if you have income and qualify.

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 most crucial forms for Chapter 11 include the voluntary petition and statement of financial affairs. Additionally, you must provide proof of credit counseling from an agency approved by the federal government. These documents provide a comprehensive overview of your financial standing and proposed reorganization plan. The filing also comes with mandatory fees you may want to place in your budget.

Chapter 13 Bankruptcy

Chapter 13 Bankruptcy is a debt restructuring or wage earners plan. In Rutland, VT 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.

The list of questions that a Rutland local may have to answer during this process includes the following:

• Do you have a regular source of income?
• Is your secured debt below the current limit of $1,257,850?
• Is your unsecured debt less than $419,275?
• Have you completed a credit counseling course from an approved agency within 180 days before filing?
• Are you using bankruptcy to resolve consumer debts rather than business debts?
• Have you submitted all the required forms and schedules to the court, including a detailed list of your assets, debts, income, and expenses?

The Bankruptcy Process in Rutland, Vermont

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 Rutland 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 Rutland, Vermont Lawyer

Hiring a local bankruptcy lawyer in Rutland 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 Vermont 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 Rutland can guide you through the entire bankruptcy process. We can even help you connect with an attorney across Vermont 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!