How Does Bankruptcy Work
Both businesses and individuals have the right to file for bankruptcy, and there are a few different options within the umbrella of protection. According to Debt.org, In 2020, bankruptcy filers owed $86 billion and had assets of $56 billion. Most of those assets were real estate holdings, whose value is debatable.
Essentially what happens when you file for bankruptcy in the courts puts a hold on all your debts, and creditors cannot continue attempting to collect on them until the matter is resolved.
A court-appointed representative works with the person in debt and evaluates their income and liabilities to determine if bankruptcy is feasible and how to proceed.
The court may discharge the debts . Or the court may decide that the person does have the means to pay off their debt and may assist in working out a payment plan.
The process includes compiling and reviewing your financial records. The court also requires that you seek the help of a credit counselor before filing for bankruptcy. You must use an approved credit counseling agency when taking this step. Then if you have exhausted all other avenues of financial help, you can file a petition for bankruptcy with the court. Once the courts have accepted your bankruptcy, your court-appointed trustee will set up meetings between you and your creditors to work out the terms of repayment and allow the creditors to ask questions. The creditors may or may not attend, but you are required by law to be there.
Put Your Bankruptcy Documents Together
Youre going to have a much easier time filing bankruptcy if you have all of the information and forms you will need right in front of you as you file. That way, you avoid chasing down information and seeking out forms when youre just ready to get it all over with.
Here are some of the key pieces of information you will need to file bankruptcy in Missouri:
- Your Social Security number
- Your wage and income information
- The name and address of your employer
- A list of all of your creditors
- A list of all of your valuable property, including your homes, land, vehicles, and valuables
- A list of each financial account in your name, including bank accounts, investment accounts, and similar accounts
- A detailed list of your recurring monthly expenses, including rent, mortgage, childcare, and groceries
- Your state and federal tax returns for the previous two years
Without A Judgement The Automatic Stay Protects Youto A Point
The automatic stay will keep the landlord from evicting you in the short-term. They wont be able to send you a notice of eviction and they wont be able to pursue a Judgement of Possession.
What they can do is ask the court to lift the automatic stay. They can simply state that letting you stay in the apartment long-term without paying them causes them undue harm. Once released from the stay, they may proceed with the bankruptcy as normal.
There is good news though: they cant do it on the basis of past due rent from before the period during which you filed bankruptcy. They can do it on past-due rent from after, which means the moment you file bankruptcy youre going to want to stay current on your rent.
Where Do I File For Bankruptcy In Kansas City Mo
Where to file your bankruptcy case depends on where you live and on whether you have a business close to home. Usually, you’ll file in the federal district court closest to where you’ve lived for the past 180 days . But if you run a business in a different district and most of your property is located there, you may have to file in the federal court serving that location.
The reason behind these filing rules is that the bankruptcy court wants the person overseeing your caseâcalled the bankruptcy trusteeâto be able to easily find, evaluate, and, if necessary, sell your property.
If you’ve moved recently, you may have to file at the bankruptcy court serving the county where you used to live. That will depend on where the greater portion of your property has been for most of the past 180 days. For example, if you lived in Oregon for most of your life, but moved to California a month ago, you’ll file in Oregon because you lived there for 150 of the past 180 days.
You can handle most interactions with the court, including filing your bankruptcy forms, by mail. However, you will need to visit the courthouse in person at least once, for a meeting with the bankruptcy trustee.
Hire A Trusted Law Firm To Help You With Your Missouri Bankruptcy
Live in Missouri and need help filing for bankruptcy, we are your best choice. Whether you live in Jefferson City, Kansas City, St. Louis, or any part of the state, we can offer you the best Missouri bankruptcy attorney that can help you throughout the bankruptcy process. Get in touch with us today.
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Do I Qualify For Bankruptcy
To qualify for Chapter 7 bankruptcy, you must show that either:
- your income is below Missouriâs median income for your family size, or
- your income and expenses, calculated together, leave you unable to pay your debts. This is determined under a complex formula called the bankruptcy means test.
If you don’t qualify for Chapter 7, you may still qualify to file under Chapter 13. To qualify for chapter 13, your debt must be under the limit set by the bankruptcy code and you must be current on your tax filings for the last four years.
If Youre Facing Eviction Chapter 13 Bankruptcy Is Often Your Best Bet
Filing Chapter 13 will roll your past-due rent into your monthly debt payment. As long as you pay the landlord your monthly rent on time from then on out, then you cant be evicted.
In some cases you may even be able to proceed with a Chapter 7, depending on your circumstances. Youll want to work closely with a Missouri bankruptcy attorney to determine the right course of action.
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Missouri Bankruptcy Means Test
The Missouri bankruptcy means test must be completed, using income information from the 6 months before your case is filed, by everyone who seeks relief under Chapter 7 bankruptcy in Missouri. It is supposed to make sure that folks who make âtoo muchâ money don’t abuse the system. If, at first, it looks like you somehow make too much money based on your gross income, you can deduct allowed reasonable expenses. If that leaves you unable to pay your debts, Chapter 7 bankruptcy is an option for you. If not, you may want to consider filing a Chapter 13 bankruptcy to get relief.
Data on Median income levels for Missouri
Missouri Median Income Standards for Means Test for Cases Filed On or After May 1,2021
What Constitutes Creditor Harassment
According to the FTC, which enforces the Fair Debt Collection Practices Act , debt collectors are prohibited from doing the following:
Calling you before 8am or after 9pm
Calling you at work, if theyre told youre not allowed to receive calls
Threatening you with physical harm
Annoying you by calling repeatedly
Lying about how much you owe
Lying about being a government official or attorney
Falsely claim you will be arrested or subject to legal action
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Go To Your 341 Meeting
If you filed Chapter 7 bankruptcy, you will have a 341 meeting also called a meeting of creditors around a month after filing. Here, your creditors can come and object to your bankruptcy filing and ask questions about your case. You are obligated to attend and answer all questions honestly, but in most cases, creditors do not attend 341 meetings. More than likely, the meeting will just be you, your attorney, and your bankruptcy trustee having a quick discussion of your case.
Questions About Missouri Liens Ask Groce & Dearmon Pc
If you have recently been notified that a lien has been placed against you, or if you need to place a lien on another party, contact us today. We can discuss your options and help you determine the best course of action for your individual situation. Our first consultation is always free. Contact Groce & DeArmon, P.C. or call toll-free in Missouri or .
You have filed for Chapter 7 bankruptcy. Your attorney says you are required to go through credit counseling. But how do you find a credit counseling agency? Do they have to be approved by the U.S. government? The bankruptcy experts at Groce & DeArmon. P.C. will guide you through these questions and more in todays blog.
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Advantages Of Chapter 13 Bankruptcy
Most people thinking about bankruptcy will choose Chapter 7 if they qualify for it, because Chapter 7 is usually over in just a few months and it totally wipes out most debts. But Chapter 13 may be right for people who are overwhelmed by secured debt because it offers ways to:
- restructure mortgage payments to save a home from foreclosure
- reduce the amount of some secured loans to match the value of the property , and
- reduce certain tax debts that canât otherwise be discharged in bankruptcy.
Did You Know That:
- Income taxes that are more than three years past due may be dischargeable in a Chapter 7 or Chapter 13 bankruptcy?
- A vast majority of Chapter 7 bankruptcy cases are approved without the debtors ever having to appear before a bankruptcy judge?
- Once a bankruptcy case is filed, pending lawsuits against the debtor or his/her property are automatically stayed ?
- You can apply for credit immediately after the court grants your bankruptcy discharge?
The hardest part of considering bankruptcy is making the first phone call. Once people speak to an attorney, they usually feel better about their financial situations immediately.
Our law firm maintains a very active consumer bankruptcy practice. Each of our Kansas City bankruptcy attorneys represents consumers in both Chapter 7 bankruptcy and Chapter 13 bankruptcy. All our attorneys are licensed to practice law in Missouri and Kansas. Additionally, principal attorney Neil Sader is certified by the American Board of Certification in Consumer Bankruptcy Law. This certification is awarded only to those attorneys who meet the organizations rigorous standards to become specialists in this legal area.
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How To File Bankruptcy Missouri
learn How To File Bankruptcy Missouri
Chapter 7 Legal professionals Ease Personal Worries
It was previously a thief may well file bankruptcy virtually impulsively, simply to leave with a large load regarding obligations. Then that each would certainly start from scratch, along with a couple many years after declare bankruptcy once again. This type of scenario just isn’t straightforward for essentially the most part a result of the modern individual bankruptcy regulation.
The bankruptcy regulations nonetheless change from region to region but most of the largest foundation within personal bankruptcy regulations is constantly on the all the states. These versions and also modifications that will be state specific are usually, typically, fairly tiny details. What’azines more, one of many outcomes of the current legal guidelines are if you’ll declare bankruptcy, you should do that will inside state in which you are a resident, therefore you cannot go to an alternative state to produce personal bankruptcy since they could have an overabundance relaxed laws in certain places.
With the newest personal bankruptcy regulations, the one who is really thinking of declaring really should proceed through a process called as signifies check. The actual means check is extremely complicated along with the outcomes of that will test can often mean the gap involving declaring bankruptcy along with ‘t be in a position to declare bankruptcy.
How To File Bankruptcy Missouri
Secured Debt Vs Unsecured Debt: What’s The Difference
Secured debt. A secured debt is backed up by property — like your home or a car — which is also known as “collateral.” The creditor can take back the collateral if you don’t repay the debt.
Secured debt can be voluntary — for example, when you get a mortgage to buy real estate or a loan to buy a car. It can also be involuntary — say, if the government puts a lien on your property for back taxes.
Unsecured debt. Unsecured debt isn’t backed up by collateral. Lenders give you credit without “security,” relying on your credit history and your promise to repay. Unsecured debt can include everything from your credit cards to your gym membership, your medical bills to a loan from a friend.
In bankruptcy, unsecured debt is divided into priority and non-priority claims. If there’s any money available to pay your creditors, priority claims come first. Non-priority unsecured debts are rarely paid in bankruptcy.
Common priority unsecured debts include:
- legal fees related to the bankruptcy filing
- child support and alimony
- federal or state income taxes
- a certain amount of wages and benefits owed to employees, and
- claims against you for operating a vehicle under the influence of alcohol or drugs.
To learn more, see our articles on How to File for Bankruptcy.
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Successfully Passing The Chapter 7 Bankruptcy Means Test
Passing the means test is not the last step in the process, as it is not the only qualifying factor. In Missouri, petitioners will be required to also submit two forms. These forms are known as Schedule I and Schedule J . If the individual has an income surplus, he or she will be court ordered to pay creditors monthly. This changes the case to a Chapter 13 bankruptcy.
Finally, qualifying for a Chapter 7 bankruptcy does not mean that a petitioner must file one. The test will simply determine that the petitioner can file for a Chapter 7 bankruptcy. It is important to explore all the available alternatives prior to making a decision. A qualified bankruptcy attorney versed in the laws local to Missouri is a invaluable resource for determining if a Chapter 7 bankruptcy is the best decision.
Need Help with the Chapter 7 Bankruptcy Means Test?
Despite the wealth of information available to help us understand the Means Test and who qualifies, the particular circumstances of individual filers can greatly vary. A qualified Pennsylvania bankruptcy attorney at your side can help fully allay your concerns, and help you understand how you can pass the means test and file for Chapter 7 bankruptcy.
Things To Know Before Filing For Missouri Bankruptcy
If you are considering filing for a Missouri bankruptcy, you should educate yourself on federal and Missouri bankruptcy laws. Individuals who are unable to repay their debts may file for one of several types of personal bankruptcy, also known as consumer bankruptcy. Missouri bankruptcy filings accomplish one of two things: You either are asking the court to discharge, or forgive, some of your debts, or you are seeking approval for a debt repayment plan.
Which type of bankruptcy is right for you will depend on your specific financial situation. Whether you live in St. Louis, Kansas City, Jefferson City or another part of the state, a local Missouri bankruptcy attorney can help advise you throughout the bankruptcy process.
This article will provide you with basic information about Missouri bankruptcy and the Missouri bankruptcy process.
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Lawsuits With Debt Collectors
If you fail to make payments on your debt, it may be turned over to a collection agency. Receiving a phone call from a collection agency is one of the first signs that you should declare bankruptcy. Failing to pay the collection agency can result in a lawsuit, and if you lose your case, you may end up owing even more in legal fees. If you do not have a plan to pay back the collection agency, it may be time to contact a bankruptcy attorney.
Working With An Attorney
Generally speaking, it is usually in ones best interest to work with a bankruptcy attorney. A bankruptcy lawyer is there to represent you and not the creditors.
An attorney is also accustomed with exemption laws. In addition, they can come up with creative strategies to keep your assets through practical repayment strategies that are fair to everyone involved.
While you may have the fight and ability to manage a Bankruptcy on your own, it tends to make things a lot easier on an already stressful situation, especially when there is so much at stake.
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Preparing And Assembling Your Bankruptcy Papers
$0 to $1,800
To file for bankruptcy, you must complete dozens of pages of forms detailing your current debts, property, income, and expenses, as well as your intentions regarding loans that are secured by collateral, such as a car loan. The cost of this phase depends on whether you hire professional help.
Free legal aid. If you qualify for legal aid or have a legal plan through your union or employer, this part may cost you nothing.
Doing it yourself. Itâs possible to prepare your own bankruptcy forms. But if you’re not the careful, diligent type, think twice about taking this path. Bankruptcy rules and judges can be unforgiving. If you want to go it alone, you must be willing to do careful research and follow instructions to the letter. We recommend that you get a good step-by-step instruction manual, which will cost around $30.
Hiring a professional. If you prefer not to handle it yourself, you can find listings of local bankruptcy lawyers on this website. In a few areas you may also find businesses run by non-lawyers, known as bankruptcy petition preparers , who arenât allowed to give legal advice but can help you fill out your forms correctly. Depending on who you choose and how much help you need, hiring a professional may cost between $200 and $1800.