Bankruptcy in South Carolina
Are your bills piling up faster than you can pay them? Whether it’s credit card debt, medical expenses, or missed mortgage payments, it’s easy to feel like you’re falling too far behind.
Bankruptcy could be the legal reset you’ve been looking for. Chapter 7 can discharge most unsecured debts, while Chapter 13 offers a structured plan to repay what you can over time. Either option can bring peace of mind and a path forward.
But getting it right depends on knowing the law. Without proper guidance, you risk delays—or worse, losing property you could have kept.
We connect people across South Carolina with trusted bankruptcy attorneys who understand the legal system. If you’re ready for a fresh financial start, we’ll help you get started.
Types of Bankruptcy in , South Carolina
Bankruptcy is a court-supervised process designed to help individuals and businesses wipe the slate clean. It can reduce or eliminate many types of financial obligations and give you the breathing room you need.
In SC, you’ll need to show that financial hardship is preventing you from keeping up. However, not every debt can be erased. Obligations like past-due child support, certain tax debts, alimony, and most student loans are generally not dischargeable.
If you’re considering bankruptcy, it’s important to understand which chapter best fits your situation. The best way to make that decision is by reviewing your options with a bankruptcy attorney.
In South Carolina, bankruptcy cases are overseen by the U.S. Bankruptcy Court for the District of South Carolina, which serves the entire state through three divisions.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is often the go-to choice for people who need a clean break from overwhelming debt. It can wipe out many unsecured obligations and give you a fresh financial start.
But before moving forward, take a close look at your income, debts, and ability to repay. If your budget is stretched too thin, Chapter 7 might be a smart option.
Most people who qualify for Chapter 7 have unstable income or have gone through a major financial shift. While it can erase your debts, you might have to surrender non-exempt property, including your car or home, depending on your equity and state exemptions.
In South Carolina, qualifying for Chapter 7 bankruptcy involves passing the means test, which assesses your financial situation to determine eligibility. The first step compares your average monthly income over the past six months to the state’s median income for a household of your size.
The annual median income thresholds in South Carolina are:
- 1-person household: $59,869
- 2-person household: $75,449
- 3-person household: $87,002
- 4-person household: $100,847
- For households larger than four, add $9,900 for each additional member.
Chapter 11 Bankruptcy
Chapter 11 bankruptcy is a more advanced option, typically used by businesses or individuals with large or complicated debt structures. It gives you the chance to reorganize what you owe and propose a payment plan that makes your debt more manageable over time. That period is usually a four to eighteen-month window.
To file for Chapter 11 bankruptcy, you must submit a range of detailed financial documents to the court. The process starts by filing a petition, which outlines your assets, liabilities, income, and expenses. These documents are essential for the court to evaluate your financial situation and determine how to move forward with your case.
Below is a list of common forms required during this process:
- Bankruptcy petition (Form 101)
- Schedules of assets and liabilities (Form 106)
- Statement of financial affairs (Form 107)
- Statement of monthly income (Form 122A-1)
- Creditor matrix
- Chapter 11 plan of reorganization
Chapter 13 Bankruptcy
Chapter 13 bankruptcy is often called a wage earner’s plan because it’s designed for people with regular income who need time to catch up. In SC, once your case is filed, the court assigns a trustee to review your income, debts, and assets to determine whether your repayment proposal is fair and feasible. Instead of liquidating property, you’ll make structured payments over three to five years to pay down what you owe.
How flexible that plan is depends on your financial picture—what you earn, what you own, and what you’re trying to keep. In many cases, completing the plan can result in some unsecured debts being forgiven.
The Bankruptcy Process in , South Carolina
Declaring bankruptcy is never an easy decision, but if your debts are unmanageable and you can’t see a way to pay them off within five years, it might be time to consider it. Filing can put a stop to mounting pressure and give you a legal framework to start fresh and rebuild your finances.
To get started in South Carolina, you’ll need to pull together a full snapshot of your financial life. That includes your current income, monthly expenses, outstanding debts, and any assets you own. The court uses this information to evaluate your case, and missing details or errors can slow things down, or get your petition denied entirely. Accuracy is key right from the start.
Filing for bankruptcy in South Carolina also involves protecting your assets through exemptions. South Carolina mandates the use of its exemption laws, which outline the types and amounts of property you can keep during bankruptcy:
- Homestead: Up to $76,125 in equity for your primary residence; $152,250 if jointly owned with a spouse.
- Motor Vehicle: Up to $7,600 in equity for one vehicle.
- Household Goods: Up to $6,100 for furniture, appliances, clothing, and other household items.
- Jewelry: Up to $1,525 in value.
- Tools of the Trade: Up to $2,275 for tools and equipment necessary for your profession.
- Wildcard: Up to $7,600 that can be applied to any property of your choice.
- Retirement Accounts: Most tax-exempt retirement accounts, including 401(k)s and IRAs, are fully protected.
- Public Benefits: Social Security, unemployment compensation, veterans’ benefits, and other public assistance are generally exempt.
- Personal Injury Awards: Compensation for personal injuries is typically protected.
Work With an Experienced , South Carolina Lawyer
South Carolina’s exemption laws allow you to keep essential property, but applying them correctly is key. The decisions you make now can affect your financial future for years to come.
That’s why legal guidance matters. A bankruptcy attorney familiar with South Carolina’s specific rules can help you protect what you own, avoid costly mistakes, and move through the process with confidence.
Submit a request online or call us today at (866) 345-6784 to get in touch with an experienced lawyer in your area!
About the Author
Aaron is a professional legal writer with a B.S. in English Education from Southern Illinois University – Carbondale. He has written, published, and edited thousands of legal articles for RequestLegalHelp, which has connected over 5 million people to legal help in the United States.
With over five years of experience writing thousands of legal articles for law firms across the U.S. and Canada, Aaron specializes in covering federal, state, and city-level legal issues ranging from auto accidents to wrongful terminations.
Still need to learn more? Check out some of our coverage on a different area of South Carolina law.
