Filing for bankruptcy is an emotional process and a very stressful time for those that have exhausted their other options. Bankruptcy is a complicated process, which individuals that initially think that they can go through on their own soon find out when they likely realize that they do not know where or how to start the process.
Knowing how to navigate complex bankruptcy laws and the process of filing for bankruptcy is likely best left to a knowledgeable lawyer that is experienced at helping individuals or businesses through the complex forms and filings and other aspects of the case. There is light at the end of the tunnel when you turn to affordable Indianapolis bankruptcy lawyers that have the expertise to handle your case and walk you through each step of the process.
What are Some Bankruptcy Basics?
Bankruptcy proceedings are handled through the United States Bankruptcy Court. The various district courts govern the cases filed in their area. Do you even know where to file a bankruptcy case? If you attempt to file any legal case in the wrong court or district, it can potentially delay the case, or cause an individual or entity to have to start the process again within the court of jurisdiction.
People often think of bankruptcy as a way to get away from their overwhelming debt. That is true, but bankruptcy involves more than a legal way to stop creditors from harassing you day and night. Bankruptcy is the legal process that helps individuals or entities such as small businesses to get a fresh start financially, and to discharge their debts or to make arrangements to repay creditors.
The two common types of bankruptcy are Chapter 7 and Chapter 13. Many people do not understand the differences, and which is the correct type of bankruptcy case for their particular situation.
Chapter 7 is commonly referred to as “liquidation bankruptcy.” It requires the sale of the debtor’s property that is nonexempt under bankruptcy laws. The proceeds of the sale are distributed to the creditors. This is the most common bankruptcy for individuals that do not own a home, or that do not have substantial income.
Chapter 13 bankruptcy, commonly referred to as “reorganization bankruptcy,” allows individuals or businesses to keep their property if there is an accepted court-mandated repayment plan.
What is the Bankruptcy Process in Indiana?
The State of Indiana requires that individuals that plan on filing for bankruptcy to undergo credit counseling within the six months prior to filing for bankruptcy. This is required under the Filing Requirements to Commence a Voluntary Case, such as that of the United States Bankruptcy Court for the Southern District of Indiana. The rule specifically states:
‘If the Debtor is an individual, a certificate of counseling from an approved credit counseling agency or a Motion Requesting Temporary or Permanent Waiver of Credit Counseling Requirement under 11 U.S.C. §109(h)’
A voluntary petition filing has other requirements, indicating that an individual must submit documents that include:
- Required Lists
- Required Statements
- Required Documents
- Required Schedules
Understanding the many forms that have to be included in the filing of a bankruptcy case can possibly add to the stress of trying to navigate the process. The experienced lawyers that have experience and comprehensive knowledge of bankruptcy law have the knowledge of all the requirements to start the bankruptcy process. That is one reason that so many people rely on the expertise of the affordable bankruptcy lawyers that understand the overwhelming process of filing for bankruptcy.
There is a means test that involves analyzing the income and expenses of the individual or the business. This process determines whether the party may be eligible to file for Chapter 7 or to file for Chapter 13 bankruptcy. The court reviews the income for the previous six months, and then performs an analysis to compare it to the average income for the state.
Another point that is noted in the Procedures Manual for the Southern District of Indiana indicates that:
‘The Bankruptcy Clerk or any Judge may deviate from the procedures in specific cases if deemed appropriate in the exercise of discretion. The Court may amend the Manual at any time without prior notice.’
Most people would likely read this statement and likely seem confused or worried about how it may affect them or their case. These types of situations and complex legal rules and laws are a reason that you are likely to want to turn to a lawyer with experience in the bankruptcy courts to help you with your case.
Parties that are below that median income are qualified to file for Chapter 7, while parties that fall above the median will proceed with additional steps that determine whether they meet the Chapter 7 or Chapter 13 qualifications.
The court requires that individuals itemize all their monthly living expenses and their sources of income. This includes real estate, vehicles, and all other assets and possessions. There are some assets that are exempt from seizure. The bankruptcy lawyer that has experience with filing bankruptcy cases and helping clients through this trying time in their lives knows the property that you can claim as exempt.
Trust an affordable, experienced attorney to help you with the process of filing for bankruptcy, and to navigate the process so that clients can get the fresh start that they need without having to try and deal with the courts and the complicated process of going through bankruptcy proceedings alone.