What Is A High
What constitutes a high income depends on several factors, such as where you live, your living expenses, the size of your family, etc. For example, a salary of $90,000 for a family in rural Pennsylvania goes a lot further than the same earnings in the city center of Philadelphia. That being said, you are a “high-income debtor” for bankruptcy purposes if your household earnings are above the state median income for your family size.
Can I File Bankruptcy If Im Not Behind On My Bills
Many people are totally up to date on all their bills. The problem is that the balance never goes down because of the interest. By the end of the month, you often dont have enough money to pay for everything that you need. If you pay the minimum payment on the debt each month, it will take many many years to pay off the bill in full. That is the problem caused by interest compounding on your bill, even if you have never missed a payment.
The Federal Bankruptcy System Needs To Declare Itself Morally Bankrupt
- By The St. Louis Post-Dispatch
The federal bankruptcy system is morally bankrupt. The system has been abused by corporations and rich people to the point that it no longer upholds the mission it was designed for: providing a limited shelter from creditors so financially strapped individuals and companies could either liquidate or reorganize and put their affairs back in order.
The mission has morphed into helping the rich hold onto their vast financial assets while ensuring the people theyve wronged get nothing, or as little as possible. Two recent examples underscore how the system serves the rich rather than holds them in check.
Years before gaining fame for its coronavirus vaccine, drug maker Johnson & Johnson was facing a public relations disaster after losing a high-profile civil Missouri lawsuit related to cancer-causing asbestos in Johnsons Baby Powder. A $2 billion verdict in favor of women who sued after contracting ovarian cancer went all the way to the U.S. Supreme Court, where it was upheld. A Missouri jury originally set damages at $4.7 billion, but the figure later got reduced in court.
The bankruptcy judge acknowledged that the settlement protecting the Sacklers was a bitter result. But because the family had manipulated the system so expertly in their own favor, he was powerless to stop them.
Don’t Miss: How To Access Bankruptcy Court Filings
Where To File Pennsylvania Bankruptcy Court Locations
Pennsylvania is subdivided into judicial districts dedicated to serving specific portions of the state. The eastern portion of Pennsylvania is served by the United States Bankruptcy Court for the Eastern District of Pennsylvania, which maintains two physical locations to serve a total of nine counties as follows:
- Philadelphia Division:
The Philadelphia Division is located at:
Robert N.C. Nix Sr. Federal Building 900 Market Street, Suite 400 Philadelphia, PA 19107
The Reading Division is located at:
The Madison Building, Suite 300 400 Washington Street 320-5255
Other Actions A Creditor May Take After Obtaining A Judgment
State laws determine the legal steps a credit card company may take to collect a judgment debt. In some states, creditors are allowed to garnish your wages for judgments. Some states allow judgment holders to apply for supplemental proceedings to identify any personal property the judgment holder may seize to satisfy the debt.
The actions the credit card company takes to collect a judgment debt depends on the company. Some credit card companies and debt collectors pursue judgment debts aggressively. Thatâs because they can afford to have full-time attorneys working on their behalf. In some cases, a person could lose a substantial portion of his or her income in wage garnishments or lose property to satisfy a judgment debt.
Don’t Miss: Epiq Corporate Restructuring Llc Phone Number
Is Credit Card Debt A Good Reason To File Chapter 7
Yes, Chapter 7 bankruptcy erases almost all credit card debt. So, if you owe far more than you think you can pay, Chapter 7 can likely help you get back on your feet and stay there.
If you are paying the minimum payments on your credit cards each month, it could take you 10 or 15 years to pay off the credit card debt, depending on the balances on your credit cards and the interest rate.
Paying the minimum payments on credit cards can cost you thousands of dollars that you do not have to pay. In addition, if you miss even one payment, the credit card company could raise your interest rate substantially. For most people, credit card debt is the main reason they need to seek debt relief.
However, a credit card company may obtain a personal judgment by filing a debt collection lawsuit. If the company is successful in obtaining a judgment, the credit card company may take actions to collect the debt that could affect your property and income.
Do Not File For Bankruptcy And Divorce Simultaneously
In order to keep things simple, its wise to file for bankruptcy before or after your divorce, not at the same time as your divorce. The major reason behind this is that once you file for chapter 7 or chapter 13 bankruptcy, a clause known as the automatic stay will be enforced. It prevents creditors from reaching out to you and freezes your assets and property.
In the event you file for bankruptcy and divorce right after, you may be left in a tricky situation because the automatic stay would keep the family court from receiving access to and dividing your assets. If this occurs, you may find yourself in a position where your divorce takes a long time to finalize and becomes increasingly stressful for you and your family.
Don’t Miss: How To Buy A New Car After Bankruptcy
I Did Not Pass The Means Test What Do I Do
If your income is too high for Chapter 7 after exhausting all of the above options, it’s not the end of the world. You can still file for bankruptcy under Chapter 13, which is not necessarily a bad thing. Even if you qualify for Chapter 7, it may not be the best option. There are often good reasons for choosing Chapter 13 over Chapter 7, such as stopping a foreclosure, saving a car from repossession, or protecting non-exempt assets.
In some cases, another non-bankruptcy option such as debt settlement, debtor defense, foreclosure defense, mortgage modification, etc. may be a better solution. Discussing your options with a Pennsylvania bankruptcy lawyer can help you sort out what type of debt relief will work best for your financial situation.
Is Chapter 7 Right For You Or Should You Pursue Other Options
Once you decide to explore bankruptcy seriously, you should with a bankruptcy expert from Going and Plank. Well help you evaluate your current situation in many ways, including assessing your eligibility and identifying which debts can be discharged. Our team will help you check your credit report, identify all your debts, and gather the paperwork needed to file.
Before you commit to a Chapter 7 bankruptcy, well help you explore all your options. Even if you qualify for Chapter 7 bankruptcy, other types of bankruptcies might be more helpful to you or your business. Well be understanding but honest, and our experienced legal team will help you explore all your choices.
Also Check: Has Mark Cuban Ever Filed For Bankruptcy
Helping Debtors In Pennsylvania Recover Financial Stability
Contrary to what creditors might want you to believe, there is no shame in filing for bankruptcy. Thousands of Americans from all walks of life have used this method of legal protection to get a financial fresh start. In reality, bankruptcy is a proactive process designed to recognize and resolve overwhelming debt.
If you are unable to pay your debts, you are not alone! The experienced bankruptcy lawyers at Dethlefs, Pykosh & Murphy Law are here to help. For nearly a decade, our team has been assisting individuals overwhelmed with financial obligations.
Contact us today to learn how we may assist you!
If I File For Bankruptcy Will Creditors Continue To Harass Me
Not unless they want to find themselves in trouble with the court. Immediately upon filing for bankruptcy, something called the âautomatic stayâ goes into place. Once they have notice of your bankruptcy, creditors and debt collectors are barred from trying to collect against you in any way. There are penalties if a creditor violates the automatic stay.
Don’t Miss: How Many Bankruptcies Has Donald Trump Filed
Why Do People File A Chapter 7 Bankruptcy Case
There are many reasons to file bankruptcy. Some of the common reasons people file Chapter 7 include:
Unemployment or a temporary decrease in income
Accident injury or sudden illness that results in substantial lost wages
Medical bills that the person cannot pay
Death of a spouse or family member
Loss of a business or downturn in business
Too much credit card debt
Poor financial management skills
Foreclosures or repossessions
Debt collection lawsuits and personal judgments
The Bankruptcy Court does not judge a person for why that person needs to file for debt relief. The Chapter 7 trustee assigned to your case does not judge you either.
If a person cannot pay their debts for whatever reason, that person may qualify to file a Chapter 7 bankruptcy case if they meet the income requirements to file a Chapter 7 in their state.
The Importance Of Family Size
Before jumping to the means test, debtors need to determine if they are high-income debtors for the purposes of the test. I often have clients with seemingly high earnings who are surprised that they fall below the state median. Many of these clients have not considered the size of their families. However, family size is one of the critical factors determining whether you are a high-income debtor.
Example: A family of four making $115,000 would have earnings well above the state median of $103,316 for their family size. But what if that family making $115,000 includes six members, the parents, and their four children)? Because the state median for a family of six is $118,078, the debtors do not have to take the means test.
Also Check: What Is A Bankruptcy Petition Preparer
Understand All Your Options Before Making A Decision
One of the many things we pride ourselves on is the educational approach we take to working with clients. We make sure that you know all your legal options for debt relief before making a decision. You will never feel forced into choosing bankruptcy, but empowered to make a smart decision for yourself and your family.
Tips Before Filing Bankruptcy In Pennsylvania
Bankruptcy can erase your debts, stop creditors from contacting you, and give you opportunities to prevent your car from being repossessed or your home from being foreclosed on. By stabilizing your finances, bankruptcy can also give you more freedom to start building good credit for your future. If you live in Pennsylvania, and you have spent months or years struggling to pay off your debts, filing bankruptcy may be the first step to turning your financial life around.
While bankruptcy can have tremendous benefits when executed carefully, the process can be confusing and difficult, especially if it is your first time filing for bankruptcy in Pennsylvania. The bankruptcy tips contained in this guide can help make the process easier and simpler. Bankruptcy is a major decision with long-term effects, so it is crucial to review your options with an experienced bankruptcy attorney before you file.
To learn more about tips on bankruptcy, the bankruptcy process, the benefits of bankruptcy, or other aspects of bankruptcy law in Pennsylvania, call the Philadelphia bankruptcy lawyers of Sadek and Cooper Law Offices, LLC at 545-0008 for a free and confidential consultation. Proudly serving Philadelphia, Bucks, Montgomery, and Delaware Counties, our attorneys handle Chapter 7 cases, Chapter 13 cases, and can also help you explore various alternatives to bankruptcy.
What Can I Own After Bankruptcy
The short answer is anything. In addition to exempt property, you can keep whatever you obtain after filing for bankruptcy. That being said, if you receive a large amount of money or other property within 6 months of filing , you may be required to pay it to the trustee for distribution to your creditors .Therefore, it is very important to tell your attorney if you are expecting such a distribution, so your attorney can review possible exemptions before you file.
Luongo Bellwoar Bankruptcy Attorneys
We offer expert, friendly bankruptcy legal advice for residents in Exton, PA and surrounding areas. We have offices conveniently located in both West Chester and Paoli PA.
Declaring bankruptcy can get you off to the fresh financial start you need. It will stop collections calls, wage garnishments, and evictions. Depending on your situation, you may be eligible to declare Chapter 7 Bankruptcy or Chapter 13 Bankruptcy.
Chapter 7, also known as straight bankruptcy, is where a person is allowed to keep certain property that is deemed exempt from the bankruptcy. Chapter 13, also known as wage earners bankruptcy, is where a payment plan is established and the debt can sometimes be reduced.
I cant express how happy I am enough to you for all your help with my bankruptcy. I could not have asked for a better lawyer to represent me.
Read Also: Taco Bell Bankruptcy Closing
What About My Credit Score
If you are looking to file bankruptcy in PA, you need the right lawyer. You want a Pennsylvania bankruptcy lawyer who will not only file your bankruptcy, but go the extra mile to rebuild your credit score. Thats why we do more than simply help you eliminate your debt. We work with you to rebuild your credit score after bankruptcy! Our clients receive free access to 7 Steps to a 720 Credit Score. If credit score is a concern, you should strongly consider bankruptcy over other options. Bankruptcy wins almost every time when you consider bankruptcy vs. debt settlement. Many of our clients see their credit score go up after bankruptcy! Thats because we know how bankruptcy affects your credit score.
Dont Miss: Filing Bankruptcy In Wisconsin
What Happens When You Go Bankrupt
If the adjudicator makes you bankrupt:
- youll receive a copy of the bankruptcy order and may be interviewed about your situation
- your assets can be used to pay your debts
- youll have to follow the bankruptcy restrictions
- your name and details will be published in the Individual Insolvency Register
You can apply to have your address removed from the Individual Insolvency Register if publishing it will put you at risk of violence. This will not affect your bankruptcy.
After 12 months youre usually released from your bankruptcy restrictions and debts. Assets that were part of your estate during the bankruptcy period can still be used to pay your debts.
You might be able to cancel your bankruptcy before youre discharged.
Bankruptcy only applies to individuals. Find out what your options are if your limited company cannot pay its creditors.
Also Check: How To File Bankruptcy Yourself In Texas
Can I Discharge Unpaid Income Taxes
Certain tax debts such as employee withholding taxes which are considered trust fund taxes are never dischargeable and will need to be paid back. However many income tax debts can be dischargeable depending on the age of the debt if a lien was filed by the taxing authority and a number of other factors. Contacting experienced Bankruptcy lawyers can show how filing bankruptcy can be used to your advantage when you want to discharge tax debts.
Pennsylvania Bankruptcy Exemptions And Law
Most families live from paycheck to paycheck. About two-thirds of Pennsylvanian households do not have the cash to pay a $400 emergency expense. So, they are incredibly vulnerable to the financial storms of life. These storms include things like business downturn, divorce or separation, sudden illness, and job loss.
Also Check: How Long Does Bankruptcy Stay On Credit Report
Our Lawyers Can Help You File For Bankruptcy In Pennsylvania
While no law prevents debtors from filing without an attorney on a pro se basis, proceeding without professional support is highly inadvisable.
Even a minor mistake could cost a debtor valuable exemptions, or even result in the dismissal of the case. If a debtor attempts to skew financial data, such as hiding assets from creditors, he or she could even be criminally investigated and prosecuted.
Our Pennsylvania bankruptcy attorneys have more than 30 years of experience helping clients file bankruptcy. We have filed over 5,000 cases. We can help make your case as smooth, efficient, and cost-effective as possible. To arrange for a free and confidential case evaluation, call our law offices at 701-6519 in Pennsylvania.
Bankruptcy Resource Center
Bankruptcies Will Change Your Life Make Sure You Have Experienced Support
Bankruptcies are complex and time-consuming. Mistakes in the process can significantly affect your ability to file bankruptcy and discharge debt. Thats why its so important to get the right legal help from Going and Plank. Like Abraham Lincoln and Milton Hershey, you can make bankruptcy the first step to launching the next phase of your life. to schedule your free bankruptcy consultation.
The Law Offices of Going and Plank are a debt relief agency. We help people file for bankruptcy under the bankruptcy code.
The Law Offices of Going and Plank are located in downtown Lancaster, PA. We are proud to participate in the Hyatt Legal Plan.
Proud to participate with MetLife Legal Plan
Also Check: Bankruptcy Document Preparers