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Chattanooga Bankruptcy Law Blog

What are the fees and necessary information for a Chapter 7?

Tennesseans dealing with financial challenges who have decided that filing for Chapter 7 bankruptcy is the best method to get back on stronger financial ground must understand certain facts about a case. There are filing fees, administrative fees and certain information must be provided to the court to proceed. These are clerical issues that should not be a major sticking point to a Chapter 7 bankruptcy, but are still imperative to successfully complete the case.

There is a fee of $245 to file, a $75 miscellaneous administrative fee, and a $15 trustee surcharge. At the time of filing, these fees will generally be paid to the clerk. Depending on the circumstances, the court might allow the debtor to pay the filing fee in installments. There is a limit of four installments and the debtor is required to make the last payments no more than 120 days after the petition has been filed. If there is sufficient cause, the court can give an extension if the last installment is paid at least 180 days after the petition has been filed.

Bankruptcy is a time-tested way for successful debt relief

There are many ways Tennesseans can find themselves facing financial challenges. Job loss, medical debt, personal issues, financial mistakes - all are reasonable explanations for having problems with finances. Often, there is a perception that there is no way out and a fresh start is unavailable. The word "bankruptcy" makes people nervous and guilty, thinking that they are shirking their responsibilities if they even consider it. The truth is that filing for bankruptcy is a perfectly legal and reasonable way to get back on stronger financial ground and move forward with one's life.

People who are experiencing financial problems should understand that bankruptcy can be a smart way to get out of overwhelming debt. The type of bankruptcy that will be used is based on the individual situation and if there is a business, ownership of certain properties, and what their goals are. In general, there is a bankruptcy chapter for everyone regardless of their situation.

What is a Chapter 13 hardship discharge?

Tennesseans who are experiencing financial challenges and have chosen to move forward with a Chapter 13 bankruptcy will undoubtedly understand the basics of the program once they choose it over other alternatives. With a Chapter 13, a plan will be created so the debtor can repay all or some of the debts in a designated time-period of three to five years. For those who have a regular income, this is a sound method to getting a fresh financial start without having to go through a possible liquidation with a Chapter 7.

However, there are certain aspects of the Chapter 13 that might not be fully understood. One is if the debtor is not able to complete the plan. This is when it is possible, if the circumstances warrant it, to have a hardship discharge. Once the plan has been confirmed, issues might come up that will keep the debtor from completing the plan. In such a case, the debtor has the right to ask the court for a hardship discharge.

Assessing if a Chapter 13 repayment plan can help

Many Tennessee residents may be hesitant to explore the possibility of a bankruptcy filing for the simple reason that they may think they do not know enough about the process to make a confident decision. As a result, they go on being burdened by overwhelming debt, struggling to make payments. However, for those who are earning an income, Chapter 13 bankruptcy may be the best option.

In a Chapter 13 bankruptcy filing, the filer sets up a repayment plan for debts owed. Every plan is different as every filer has different types of debt and different levels of income. Over the course of three to five years, the debtor will repay their debts. In some cases, not all of the debt will be repaid. Remaining debt is often discharged.

Carrying credit card debt is going to get more expensive

It would have been pretty easy for our readers in Tennessee to overlook a recent news report that may have quite a significant impact on their finances. According to a recent report, the Federal Reserve has decided to adjust their interest rate upwards - a quarter percent of a hike.

While that may not sound like too much in the grand scheme of things, it actually could have more of an impact on your finances than many people realize. The Federal Reserve's interest rate is attached to many different areas of financial significance, including adjustable rate mortgages and interest rates on credit cards.

Tips for improving your credit score

Tennessee residents who are facing debt problems will, in general, probably do their best to find a solution. Many will set up a household budget and stick to it, devoting a significant portion of their monthly income to paying down debt. Repaying the credit card debt in full is obviously the main goal, but there are other ways to improve a credit score.

As a recent article noted, there are two main things that determine your credit score: whether you make your payments on time, and how much of your total credit availability you are using. Paying the monthly bills on time is probably the easiest way to make sure that your credit score is improving.

What is wage garnishment and can bankruptcy help?

Tennessee residents work hard for their paychecks. That's why it can be so troubling to see money being withheld from those paychecks before they even reach the worker. This is known as wage garnishment.

Wage garnishment can be ordered when a person has a financial obligation that has otherwise gone unmet. For instance, in many cases of wage garnishment the financial obligation is child support. Or, in other cases, the garnishment might be ordered due to another type of court judgment. When a Tennessee resident gets behind on debt payments or simply isn't making the payments, a court could order that person's wages garnished.

Discharge unsecured debt with Chapter 7 bankruptcy

For most Tennessee residents who are considering the advantages and disadvantages of filing for bankruptcy, there is one main motivation: address seemingly insurmountable debt. Debt can be a creeping type of problem that finally catches up with you, or it can be the result of a sudden and unexpected turn of events, like the onset of a medical condition or the loss of employment. Whatever the reason, Tennessee residents need to know that bankruptcy is a tool for consumers to get a fresh financial start.

The primary benefit of Chapter 7 bankruptcy, also known as liquidation bankruptcy, is the elimination of debt. Most types of debt, such as credit card bills, medical bills and personal loans, can be eliminated in a Chapter 7 bankruptcy filing. However, one particular type of debt - which is becoming a major factor in the lives of millions of Americans - cannot be discharged: student loan debt.

As debt level climbs in America, many will seek options

Tennessee residents who have high levels of debt are not alone. According to a recent report, the overall debt balance of households throughout the country has risen to a level not seen since 2008 - prior to the financial crisis that resulted in the so-called "Great Recession."

Most indicators cited in the media show that the economy is on the rebound and maintaining health. In fact, some economists point to the rising level of debt in America as evidence that consumers have more confidence in their ability to earn an income, and therefore repay debt. However, with an overall debt balance of $12.73 trillion for all American households, there are bound to be some individuals and families who are facing financial setbacks.

Making the right move to find debt relief

Tennessee residents accumulate debt in a variety of ways. These days, student loan debts seem to be the primary problems. But, in other cases, many people have high levels of credit card debt or medical debt. Whatever the source of your debt problems, a variety of options - or a combination of options - may be available.

The first step in seeking debt relief is to get a full grasp of just how much debt you owe, and what type of debt it is. Why is this important? Well, some types of debts can be addressed by options such as filing for bankruptcy. Credit card debt and medical debt, for instance, could be addressed through a bankruptcy filing. However, student loan debt typically is not dischargeable in a bankruptcy action.

Kenneth C. Rannick, P.C.
4416 Brainerd Road
Chattanooga, TN 37411

Phone: 423-954-7180
Phone: 423-624-4002
Fax: 423-624-0509
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