Hanover, PA Bankruptcy Lawyers
When you are struggling paying your bills and expenses, you might not believe you have many options. While collection letters stuff your mailbox, your voice mail fills up with messages from creditors, and lawsuits filed, few answers are apparent. You might fleetingly consider bankruptcy, but you have heard stories about losing property, having terrible credit, or never being approved for a loan if you take that step. Unfortunately, there is a substantial amount of misinformation about bankruptcy circulating online and in conversations.
Bankruptcy was designed to offer individuals, couples, and businesses a means of addressing their debt while providing legal protection from their creditors. If you are young but still carrying debt from credit cards you maxed out in college or are facing losing your home to foreclosure, bankruptcy could be the relief you need.
The experienced Hanover, PA bankruptcy lawyers at Young, Marr, Mallis & Associates understand the concerns that people have about filing for bankruptcy. Our goal is to offer professional legal representation while ensuring that our clients understand and feel comfortable with the process. Filing for bankruptcy does not cure every economic ill. However, it does offer many advantages. Call (215) 701-6519 to confidentially review your financial circumstances.
Chapter 7 Bankruptcy in Hanover, Pennsylvania
When people think about consumer bankruptcy, they probably envision a Chapter 7 case. When someone files Chapter 7, they hope to eliminate most of their debt within five or six months. Designed for debtors with limited income and assets, Chapter 7 is often referred to as a “straight” or “liquidation” bankruptcy.
Liquidation is a frightening term. It reinforces the idea that you will lose your possessions, such as your car or home if you file for bankruptcy. While this is technically true, it does not practically work in this fashion. When you file for bankruptcy, your property becomes the bankruptcy estate. The bankruptcy estate includes your home, car, savings, and your personal property. A court-appointed trustee is charged with taking possession of your property, selling it, and disbursing the proceeds to your creditors. Hence, the name ‘liquidation.”
However, there are protections under both federal and state law that allow debtors to keep most, if not all, of their property. When our Hanover bankruptcy lawyers review your potential case, we will evaluate your assets to determine what could be protected. This property is known as your “exempt property.” In most Chapter 7 cases in Hanover, there are enough exemptions available to protect all a debtor’s property.
Chapter 13 Bankruptcies in Hanover, Pennsylvania
Chapter 13 bankruptcies work significantly differently from Chapter 7. Where Chapter 7 is designed to quickly eliminate debt, a Chapter 13 case is used to reorganize financial obligations over three to five years. People will file for Chapter 13 if they make too much money to qualify for Chapter 7, have non-exempt property they wish to keep, or have a specific debt they want to pay back.
One of the most common reasons someone files a Chapter 13 case is to stop a foreclosure or sheriff’s sale on their home. When you file any chapter of bankruptcy, a court-imposed injunction goes into effect that bars your creditors from pursuing collection actions against you, including lawsuits.
Therefore, when you file for bankruptcy, an automatic stay stops a foreclosure or scheduled sheriff’s sale. The power of this injunction cannot be understated. Filing for Chapter 13 keeps your creditors at bay while you work to reorganize your debt.
Returning to a foreclosure, imagine a homeowner was out of work for many months and they fell behind on their mortgage. Once a mortgage lender starts a foreclosure, they typically want all the arrears paid, including all attorney fees and court costs. Even though the homeowner returned to work, they do not have the funds to pay what the lender demands. By filing for bankruptcy, the homeowner will stop the foreclosure and force the mortgage lender to accept a five-year payment plan. Depending on the debtor’s income and other assets, they could also discharge any unsecured debt they have accumulated.
Some Debts Are Not Dischargeable When You File for Bankruptcy in Hanover
The more you know about bankruptcy, the better it sounds. However, it is not a “get out of jail for free” card. There are some debts that you cannot eliminate through bankruptcy. For example, alimony, child support, criminal restitution, and certain taxes are non-dischargeable.
Another debt that is hard to discharge is student loan debt. The student loan crisis is a harsh reality for many people in Hanover. Unfortunately, student loan debt is only dischargeable under very rare circumstances. However, this does not mean that filing for bankruptcy is not helpful. Under some circumstances, you might be able to partially discharge your loan debt. In others, discharging other unsecured debt could make paying your student loans more manageable. For other debtors, filing Chapter 13 will lower their monthly payments for five years. While the loan balance will not be discharged, their financial position could significantly improve over five years. If you have student loan debt, do not assume you are out of options. Our Hanover bankruptcy lawyers might be able to offer some hope.
Hanover, PA Bankruptcy Lawyers Offer Professional and Compassionate Representation
If you are struggling financially, you should not have to struggle with the decision to file for bankruptcy. Our Hanover, PA bankruptcy lawyers are committed to providing our clients compassionate and professional representation. Our goal is to dispel the fears and misinformation regarding bankruptcy. Bankruptcy was intended to give people a fresh start and we want to help you take advantage of its benefits. Call (215) 701-6519 to discuss how Young, Marr, Mallis & Associates can help you.