South Carolina Bankruptcy Process How To File Bankruptcy In South Carolina
2005 Bankruptcy Act Credit Counseling The 2005 Bankruptcy Act requires all individual debtors who file bankruptcy on or after October 17, 2005, to undergo credit counseling within six months before filing for bankruptcy relief and to complete a financial management instructional course after filing bankruptcy.
2005 Bankruptcy Act Means TestUnder the 2005 Bankruptcy Act your income and expenses will be analyzed to determine if you qualify to file a Chapter 7 or if you must file Chapter 13. To apply the means test, the courts will look at the your average income for the 6 months prior to filing and compare it to the median income for South Carolina. If the income is below the median, then you may choose Chapter 7. If your income exceeds the median, the remaining parts of the means test will be applied to determine if you can file Chapter 7 or if you must file Chapter 13.
Gathering PaperworkTo begin the bankruptcy process you must itemize your current income sources; major financial transactions for the last two years; monthly living expenses; debts ; and property . You should also collect your tax returns for the last two years, deeds to any real estate you own, your car titles, and the documents for any loans you may have.
The cost for filing a Chapter 7 bankruptcy is $306. This fee may not be waived but you may be able to pay it in installments. The fee of $281 for a Chapter 13 bankruptcy cannot be waived.
When Must I Make My First Payment In A Chapter 13 Bankruptcy
Your first payment is due 30 days after you file your bankruptcy petition. The most important thing to remember with Chapter 13 bankruptcy is to, as I say, pay early, pay often. If you fail to make payments, your case will get dismissed. Also, keep in mind that just because youre paying through a payroll order or via ACH doesnt change this. YOU and YOU ALONE are responsible for making all your required Chapter 13 payments.; Some clients spend money not taken from their wages and believe this is an excuse for not paying. Its not.; If your employer doesnt send in the money or the ACH doesnt work, then do it 1959 style. Write a check out to the trustee, stick a stamp on it, and place it in the mail box.
District Of South Carolina Requirements
The Palmetto State is a single bankruptcy districts broken into three separate divisions. The county you live in determines which division your case will be assigned to. To assist folks who may not be able to afford a lawyer for their South Carolina bankruptcy matter, the Court offers “Ask-A-Lawyer” – a program that sets up specific times during which people with bankruptcy related questions can call a number in order to talk to a lawyer about it for free.
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Chapter 7 Vs Chapter 13 Bankruptcy
Bankruptcy is a broad term for a Federal law that allows businesses and individuals to escape from debt and pay off their creditors. Although, there are various types of bankruptcy, the two most commonly used are Chapter 7 and Chapter 13.
Under Chapter 7 bankruptcy, a persons assets may be liquidated with the exception of the most necessary assets. In exchange for discharging the debt, the bankruptcy filer turns all nonexempt property over to the bankruptcy trustee to be sold to pay off the debts.
Chapter 13 bankruptcy results in a debt adjustment plan. The filer normally keeps all property, but pays all disposable income directly to a bankruptcy trustee every month. The trustee makes payments to creditors from this income under a plan the bankruptcy court approves. The debts are usually reduced based on the filers disposable income and are usually paid over a three to five year period.
Mandatory Debtor Education Debt Management Course
$0 to $75
As if you don’t have enough hoops to jump through, when you’ve completed all the other parts of your bankruptcy, you still don’t get that magic piece of paper called the “discharge” until you complete a course in debt management.
This is yet another requirement motivated by Congress’s frequently mistaken assumption that people who file for bankruptcy wouldn’t be broke if they weren’t so careless with their money. Chances are, you really are brokeâand not because you’re irresponsibleâso you should see if you qualify for free or reduced rates.
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Bankruptcy used to have a bad reputation as an indication of irresponsibility, but in this economic climate when everyone is hurting, it’s a fact of life. For many people just like you, bankruptcy can be the smartest way to;take control of rising debt. And;bankruptcy is not as complicated;as you might think. Simply put, United States bankruptcy law allows individuals and businesses to eliminate or reorganize debt.
If you got injured at work, were laid off, lost a loved one, had a major medical emergency or have been living above your means,;reorganizing your debt can be the ideal solution. Benjamin R. Matthews and Associates, LLC can help you with either;Chapter 7 bankruptcy;or;Chapter 13 bankruptcy.
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Doesnt Filing For Bankruptcy Ruin My Reputation And My Life
Not if it gets you out of debt. You might be able to run from creditors for a while, but eventually the stress of that overwhelms people. Bankruptcy lets you stop running and start over again. It may take a few years for you to get loans and obtain credit again, but at least youll have that opportunity. Bankruptcy is meant to give people who made financial mistakes a second chance. In todays turbulent economy, that is a good thing.
South Carolina Bankruptcy Forms
The South Carolina Chapter 7 bankruptcy forms are the forms that everyone who files a Chapter 7 bankruptcy in South Carolina has to submit to the court as part of their case. The majority of them are the online bankruptcy forms available for folks filing bankruptcy anywhere in the country. Most of the local forms created by the court are used in more complex South Carolina bankruptcy cases including cases under Chapter 13.
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What Are The Federal Bankruptcy Exemptions
Although most states require bankruptcy filers to use state-specific bankruptcy exemptions, South Carolina law allows you to use either state or federal exemptions. However, you must choose one or the other you cannot use parts of both. If you choose to use federal exemptions when you file for bankruptcy, then you may keep:
- $23,675 of equity in your primary home. This is the homestead exemption; you can use it to protect residential real estate as long as you live there. However, this does not extend to investments in rental properties.
- Your vehicle up to a value of $3,775.
- Jewelry valued up to $1,600.
- Household items worth up to a total of $12,625, as long as no single item is worth more than $600. This includes furniture, appliances, clothes, animals, books, etc.
- Tools for your work, including books, valued up to $2,375.
- A total of $12,625 in loan value, dividends or life insurance policy interest.
- All health aids.
When To File Chapter 7 Bankruptcy
There are several warning signs that you should be considering Chapter 7 bankruptcy. Five strong signs that indicate filing for Chapter 7 may be the right solution include:
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What Do You Mean By Exempt Property
The law allows debtors to keep a certain amount of propertyso much equity in a home, car, jewelry, household good, tools of the trade, and other propertywithout having the bankruptcy trustee sell the property to pay creditors.; An exemption may be provided under state law , or under the Bankruptcy Code, depending on whether a state has opted out of the federal exemptions in the Bankruptcy Code.; South Carolina has opted out, so most debtors filing in South Carolina will use the exemptions found in S.C. Code Ann. §15-41-30.; There are also many other exemptions found in other parts of the South Carolina Code.; If you moved to South Carolina less than two years prior to your bankruptcy filing, you will not be able to use South Carolina exemptions.; Instead, youll use the exemptions in the state you lived in prior to the move, or federal exemptions, or either, depending on the state from which you moved.; Knowing what exemptions to use can be complicated. For more information on exemptions, see Exemptions in Bankruptcy.
How To File Bankruptcy In South Carolina For Free
Even though there is a $338 court filing fee for a Chapter 7 bankruptcy in South Carolina, you can ask the court to waive this fee. As long as your income is less than 150% of the federal poverty guidelines and the court finds that you are unable to pay the fee even after filing bankruptcy in South Carolina, you can file your case for free.
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Whats The Difference Between Chapter 7 And Chapter 13 Bankruptcy
The major difference is time Chapter 7 takes 4-6 months; Chapter 13 takes 3-5 years and money. You can have most, or all your unsecured debt discharged in Chapter 7 bankruptcy. In Chapter 13, some of your debt is forgiven, but only if you meet the conditions approved by the trustee and bankruptcy judge.
Understand The Costs Of Filing Bankruptcy In South Carolina
When you file for bankruptcy, you need to understand the cost and affordability of bankruptcy. The costs primarily consist of the filing fee and the attorney fee . Firstly, most attorneys offer payment plans. Some also offer $0 down payment options. The cost of the attorney can be variable based on such factors like your location and the difficulty of the case.
We built this South Carolina attorney fee calculator to help you estimate costs based on your specific zip code.;
If you cannot afford a payment plan, you may also look at the legal aid options in your state and also how the filing fee waiver works.
Legal Aid In South Carolina
There are certain situations where you could get help through legal aid. Please note that each legal aid may have criteria set for who they will help. Here are legal aid option in South Carolina.
Filing Fee Waiver in South Carolina
Theres a filing fee to file bankruptcy. You can check the South Carolina filing fee waiver requirements to see whether you may be eligible for the filing fee waiver.;
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Qualifying For Bankruptcy In South Carolina
If you’ve never filed for bankruptcy before, you’ll meet the initial requirement. Otherwise, check whether enough time has passed to allow you to file again. The waiting period varies depending on the chapter previously filed and the chapter you plan to file. Learn more about multiple bankruptcy filings.
You’ll also need to meet specific chapter qualifications.
You’ll qualify for Chapter 7 bankruptcy if your family’s gross income is lower than the median income for the same size family in your state. Add all gross income earned during the last six months and multiply it by two. Compare the figure to the income charts on the U.S. Trustee’s website .
Want an easy way to do this online? Use the Quick Median Income Test. If you find that you make too much, you still might qualify after taking the second part of the “means test.” If, after subtracting expenses, you don’t have enough remaining to pay into a Chapter 13 plan, you’ll qualify for Chapter 7.
Qualifying for Chapter 13 can be an expensive proposition because the extra benefits come at a hefty price, and many people can’t afford the monthly payment. To qualify, you’ll pay the larger of:
Income Above The Limit Proceed To The Means Test
As of the most recent guidelines, if your income falls below the amounts listed above, you can proceed with a Chapter 7 bankruptcy.; However, even if your income is slightly above these amounts, it does not mean you are ineligible. Instead, you will just have to undergo more scrutiny and pass a means test to determine if you qualify. If not, you would need to file a Chapter 13 bankruptcy.
A means test is simply a calculation of your assets, liabilities, and income, designed to determine your overall capacity to repay debts. You will likely want to work closely with an experienced attorney to gather the necessary documentation, so as to improve your chances of success.
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Request A Pro Bono Attorney
There are a few different programs in South Carolina that offer pro bono services. If you meet income and asset edibility, but South Carolina Legal Services is unable to assist you, ask them to make a referral to the South Carolina Bar Pro Bono Program.
The South Carolina Bar Pro Bono Program uses volunteer attorneys to help people with a variety of legal issues throughout the state. There are also regional pro bono providers.
Understand Which Debts Will Be Eliminated
The goal of bankruptcy is to get relief from your debt. As such, it can be helpful to understand the types of debt that can be eliminated when filing for bankruptcy.;
Many debts can be discharged. This includes unsecured credit cards, medical debts, personal loans, old utility bills, judgment debts, and old lease payments;
Other debts cannot be discharged. This includes back alimony or child support, debts owed to the government, judgments related to DUI accidents, tax debts, and administrative costs or restitution;
Tax debt receives special treatment in Chapter 13. You may not know how much debt you have. As such, you can access a free credit report annually, thanks to the US government. This can help you estimate how much debt would be eliminated by filing for bankruptcy.
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You Can Protect Property In A South Carolina Bankruptcy By Using The South Carolina Bankruptcy Exemption Laws
Updated By Cara O’Neill, Attorney
You won’t lose everything when filing for bankruptcy in South Carolina. You’ll be able to use South Carolina’s bankruptcy exemptions to protect property you’ll need to work and live, like your home, personal items, and a retirement account.
Find out more about filing a South Carolina bankruptcy case.
Do I Qualify For A Chapter 7 Bankruptcy In South Carolina
May 24, 2018
If you are an individual and are facing a personal bankruptcy, you will generally have to choose between two types of bankruptcy filings Chapter 7 or Chapter 13. The one you choose will largely depend on your income and assets. Chapter 7 is the bankruptcy type that most people think of when discussing a clean slate.; In Chapter 7, a debtors entire obligation is written-off and discharged, leaving that person with no ongoing debts . If this sounds like what you are looking for, youll want to check state rules to make sure you qualify. If you are having difficulty paying your bills and need help deciding which type of bankruptcy might be right for you, contact David Aylor Law Offices today.
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How South Carolina Exemptions Work In Bankruptcy
If you own property that is worth a certain amount, and that amount is equal to or less than the exemption amount that is available in South Carolina, you get to keep the property.
For example, if you own a car that is worth $4,725, and the South Carolina vehicle exemption is up to $5,900, you will get to keep your car if you file for Chapter 7 bankruptcy. If the car is worth substantially more than the exemption, the bankruptcy trustee may sell the vehicle, pay off the car loan with the proceeds, pay you the amount of the exemption and pay the rest to unsecured creditors.
To learn more information about bankruptcy exemptions in South Carolina, contact bankruptcy attorney Robert King at the law firm of Thompson & King. Call our Anderson office at to schedule an initial consultation and discuss your options with a lawyer.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
Go To Court To File Your Forms
Only attorneys filing bankruptcy in South Carolina on behalf of their clients are able to do so electronically. Everyone else has to submit a paper version of all of their bankruptcy forms to the court. While you can file your case by mailing everything to the clerk’s office, it’s recommended that you take the time to file the documents needed for your Chapter 7 bankruptcy in South Carolina in person. That helps avoid any delays due to mailing and gives you the opportunity to correct any errors, or add a missing signature right then and there, rather than having to deal with a deficiency notice the court will mail to you otherwise. Even though the court has locations in Charleston, Columbia and Spartanburg, only the Columbia office has a fully staffed bankruptcy clerk’s office. If you plan on heading to Charleston or Spartanburg to file your Chapter 7 bankruptcy in South Carolina, you should give the clerk’s office a call first to confirm they can assist you with this. When you get to the courthouse, remember that you will be entering a federal building, which means you will have to pass through building security on your way in.
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