Bankruptcy Provides a Fresh Start

The purpose of bankruptcy is to provide individuals overburdened with debt a fresh start. This fresh start is not for people seeking to abuse the protections bankruptcy offers, but for those who, for a variety of reasons, cannot make ends meet.

Take, for example, a that has just begun the bankruptcy process. After living in the suburbs for most of their 25-year marriage, they decided to relocate. Within months after closing on their new home they experienced an illness. After a year of treatment and a job loss, they had accumulated over $20,000 in medical bills. Additionally, because the couple was forced to suddenly live on one (1) income, they accumulated more than $30,000 in credit card debt. Most worrisome to the couple was the fact they were four (4) payments behind on their mortgage. This was all in addition to arrearages in other bills.

Thankfully, this couple realized they were in over their heads and sought legal advice regarding bankruptcy protection. Now their home is no longer in danger of foreclosure and their automobiles are not in danger of repossession. These are not people looking to take advantage of bankruptcy, but good people who have been hit with an unexpected setback.

If you have experienced unexpected setbacks and you simply cannot make ends meet, please contact the attorneys at Lee Cossell Kuhen & Love, LLP. Our experienced professionals can assist you in understanding what filing bankruptcy can do for you.

The Different Types of Bankruptcy

Most debtors filing bankruptcy file either a Chapter 7 or Chapter 13. Since these are the two (2) most commonly filed bankruptcies it is important to know which type may be appropriate for you.

A Chapter 7 bankruptcy is generally filed when a person or married couple has a large amount of unsecured debt and no significant equity in a home, vehicle, or other personal property. Typical unsecured debt consists of credit cards and medical bills. If a Chapter 7 is filed it will typically discharge all unsecured debt. When a debtor files a Chapter 7 bankruptcy that person has the option of keeping their home and car simply by signing an agreement and keeping the payments current. The debtor must meet the Chapter 7 exemptions however to retain property.

A Chapter 13 bankruptcy is generally filed when an individual or married couple has significant equity in a home or does not meet the income guidelines for a Chapter 7. A Chapter 13 protects these assets from being seized and sold to pay a creditor. A Chapter 13 can immediately stop foreclosure proceedings however the debtor must have the means to fund or pay the arrearage through the Chapter 13 plan.

A Chapter 13 is superior to “debt relief agencies” that attempt to work out payment arrangements with creditors on the debtor’s behalf. These agencies may not have authority to stop the seizure of assets, no authority to stop monetary penalties from being assessed, and no authority to stop collection agencies from calling.

If you have any questions about Chapter 7 or Chapter 13 bankruptcies, please contact Lee Cossell Kuehn & Love, LLP at (317) 631-5151.

If your home is in Foreclosure…

If your home is in foreclosure, then you may need to consider filing for Bankruptcy Protection. In most situations filing for Bankruptcy Protection will immediately stop foreclosure. Bankruptcy can also help you catch up on past due payments by spreading out the past due payments over a three (3) to five (5) year period. For example, if you were behind in your mortgage payments by $5,000.00 you would be able to catch up on that amount by paying as little as $83.34 per month. During this three (3) to five (5) year period, your home cannot be taken away from you so long as you are current on your payments.

Owning a home is the American Dream. Don’t let that dream be taken away from you without a fight. If your home is in foreclosure, please contact Lee Cossell Kuehn & Love, LLP at (317) 631-5151.

Bankruptcy & Child Support

Generally, Bankruptcy will not wipe out child support obligations. However, Bankruptcy can make it easier to pay child support obligations and get caught up on any past due child support you may owe. Bankruptcy may make it easier to pay child support obligations by eliminating certain other types of debt you owe. For example, if you are currently paying credit card debt, housing expenses, and child support you can potentially rid yourself of the credit card debt. By eliminating the credit card debt you may have more money available to pay your child support obligations.

If you have specific questions on whether bankruptcy is right for you and your situation, please call the law offices of Lee Cossell Kuehn & Love, LLP at (317) 631-5151 for a free consultation.

Bankrupty Myth No. 1: It Is Too Difficult To File Under The New Laws

This myth could not be farther from the truth. The new laws generally have no effect on the typical person seeking to file for bankruptcy protection. For the most part everything that was available under the old laws is still available under the new law. It is true that in some instances the laws are stricter and there may be additional paperwork, but that should not hold anyone back from seeking the "fresh start" provided by the Federal Bankruptcy Laws. If you have specific questions on how the new laws affect your ability to file bankruptcy, please call the law offices of Lee Cossell Kuehn & Love, LLP at (317) 631-5151.