When times are tough and you are hit with problems such as unexpected layoffs or major illness, bills rapidly pile up to the point where you may be considering filing for the relief that bankruptcy can bring. You may wonder just how much debt you have to be in to file for Chapter 7.
Ohio bankruptcy laws don’t require a certain minimum amount of debt in order to be eligible for bankruptcy. While your debt amount is a significant factor, deciding whether bankruptcy is the right choice for you will depend on additional factors as well.
How Chapter 7 Bankruptcy Can Help
Chapter 7 bankruptcy provides tremendous relief for debtors. If you are eligible, Chapter 7 may discharge (eliminate) unsecured debts, including credit cards, medical bills, and installment loans. It stops, prevents, or resolves collections, loan deficiencies, repossessions, wage garnishment, and civil judgments. It can help you eliminate the bills you cannot afford while allowing you to keep assets such as your car and your house.
If your income is too low to pay credit card bills, medical bills, utilities, payday loans, or personal loans, Chapter 7 may be the best option. The process is over in a few months, so you can begin rebuilding credit quickly. You might have to sell property to help pay creditors, but there are Ohio bankruptcy exemptions listing types of property that cannot be sold. If your home, car, and other items are exempt, you might be able to keep them from being liquidated, and if you do not own much property, your possessions may all be exempt, qualifying you for a “no asset” case.
Considering bankruptcy in Ohio? Call 614-228-4435 (Columbus), 937-222-7472 (Dayton), or 877-654-5297 (Cincinnati) to speak with one of the experienced bankruptcy lawyers at Fesenmyer Cousino Weinzimmer.
How Much Debt Do I Have to Be in to File Chapter 7?
While there is no minimum debt requirement to file for bankruptcy, the amount of debt is an important factor to consider when determining whether bankruptcy is in your best interests. Understanding the most important considerations can help you assess whether Chapter 7 is right for you.
First, identify whether you can repay your debts without going through bankruptcy. If your income is sufficient, you may be able to pay off your debts without bankruptcy, or you may be able to use tactics such as:
- Negotiating with your creditors to settle your debts for less than you owe or to buy time to get back on your feet
- Get help from a non-profit credit counseling agency for a plan to repay your debts over time
For more information on nonprofits that might be able to help, go to usdoj.gov/ust and click on “Credit Counseling and Debtor Education” to find area agencies.
Then, consider whether your creditors are willing to negotiate and work with you to clear your debt. Creditors would rather collect a lower amount than nothing at all, so they may be willing to:
- Settle debts for less
- Reduce your principal balance or interest rate
- Come up with a payment plan to get caught up over time
Our bankruptcy attorneys can assist you with the debt negotiation process. It can be difficult to negotiate with debtors all on your own. Working with our skilled lawyers can considerably increase your chance of a successful outcome.
Another important factor is whether you can discharge the types of debt you have in bankruptcy. Chapter 7 will eliminate most unsecured debt, but if your debt is in certain areas that are not dischargeable, it may not pay for you to file bankruptcy. Debts you cannot eliminate include:
- Alimony and child support
- Priority tax debts
- Debts incurred through fraud, false pretenses, or personal injury
- Student loans, unless you qualify for the undue hardship exception
Finally, your individual circumstances matter when it comes to identifying whether Chapter 7 bankruptcy is the right path forward. No matter how much debt you have, it may pay to consider bankruptcy if you can’t afford to pay back your unsecured debts. When your creditors are about to sue you or garnish your wages or are trying to repossess or foreclose on property you wish to keep, the best thing you can do is contact a bankruptcy lawyer for advice as soon as possible.
Why You Need an Ohio Bankruptcy Attorney
Even the simplest bankruptcy cases require completing extensive forms, researching exemption laws, and following all local court rules within time limits. The more complicated your situation, the more you need the help of an attorney. Mistakes can not only be costly — they can result in loss of nonexempt assets, denial of discharge of debt, or, even worse, lead to criminal charges for fraud. It makes more sense to have an attorney’s help to ensure that everything is done properly and correctly.
From beginning to end, your bankruptcy lawyer fights to help get your debt under control. The right attorney can help you create a path toward financial freedom.
Your bankruptcy attorney is the one person on your side, helping to negotiate your debt and ensure you achieve financial freedom. At Fesenmyer Cousino Weinzimmer, we know that money is probably tight if you’re considering bankruptcy, and we offer affordable rates that work with your current financial circumstances.
Contact Our Bankruptcy Lawyers for Help
Bankruptcy is complex, but the seasoned and compassionate attorneys at Fesenmyer Cousino Weinzimmer know the issues and the difficult decisions involved.
We will provide you with a personalized case evaluation and counsel regarding debt relief options, including Chapter 7 bankruptcy. We will make sure you are aware of all options and help you decide on the path to a brighter future that makes sense in your individual case. We understand what you are going through and will walk you through the process.
Don’t delay. Call Fesenmyer Cousino Weinzimmer today at 614-228-4435 (Columbus), 937-222-7472 (Dayton), or 877-654-5297 (Cincinnati) for a free consultation so we can determine what debt relief solutions will work best for you.
