Bankruptcy in Salem, OR
Are you contemplating bankruptcy or hiring a bankruptcy attorney in Salem, Oregon? 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 Salem, Oregon
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 Salem, OR 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.
Debtors from Salem may find themselves communicating with the U.S. Bankruptcy Court of the District of Oregon. Hearings and filings can go through a judge or trustees from this court.
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 Salem 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.
According to the Oregon State Bar, Chapter 7 is the most common type of bankruptcy. While this can discharge most of the debt accumulated, some will still continue to follow you around. Student loans, taxes, or child support are examples of obligations that continue.
To reach this point, the federal government makes credit counseling mandatory before filing. Depending on the state-approved organization that you choose, this can come at little to no cost. American Consumer Credit Counseling is one of the options available in Salem that provides this service for free.
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.
Working with a trustee is an important responsibility while going through a Chapter 11 bankruptcy. Guidelines published by the Office of the United States Trustee describe these obligations. For example, a debtor from Salem must provide their reorganization plan to the state within 14 days of the initial petition. In turn, the trustee collects payments and completes tasks like verifying insurance policies.
Chapter 13 Bankruptcy
Chapter 13 Bankruptcy is a debt restructuring or wage earners plan. In Salem, OR 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 Oregon State Bar reports that the fee for filing a Chapter 13 is $310 at the time of writing. This debt relief is also considered a special part of bankruptcy law. It achieves this status because Salem residents can keep their property while making payments. Not everyone with delinquent accounts can qualify, however. For starters, you need to have less than $419,275 in unsecured and $1,257,860 in secured debts. Subsequent meetings of creditors will occur, and you will have to attend these sessions without exception.
The Bankruptcy Process in Salem, Oregon
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 Salem 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.
Additionally, debtors will need to choose between federal and state exemptions for their property. This decision should be a thoughtful one. An advantage in one category may prevent you from finding an option that leaves you with the most value.
For example, consider the differences between homestead exemptions. You can keep up to $40,000 in equity in your home under Oregon legislation or up to $50,000 for couples. As of April 2019, the U.S. government offers $25,150. However, despite the significant difference, this may not matter if you don’t own your home in Salem.
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 Salem, Oregon Lawyer
Hiring a local bankruptcy lawyer in Salem 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 Oregon 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 Salem can guide you through the entire bankruptcy process. We can even help you connect with an attorney across Oregon 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!