Bucks County Bankruptcy Lawyers
Contrary to media spin, bankruptcy is not the domain of business tycoons and actors. Why? Because, for many people, bankruptcy is the optimal path back to restoring financial stability. In fact, millions of Americans file for bankruptcy every year, including thousands of people here in Pennsylvania. Court statistics show that in 2019 alone, over 1,200 bankruptcy cases were filed in Bucks County. Why? Because for many debtors, bankruptcy is the optimal way of relieving debt and restoring financial stability.
If you have been struggling to pay off your debts, bankruptcy may be a step in the right direction. However, the filing process is complex, which makes it important to work with a knowledgeable and trusted Bucks County bankruptcy attorney. At Young, Marr & Associates, we have more than 30 years of legal experience handling over 10,000 bankruptcy cases. Whether you are interested in Chapter 7 bankruptcy, Chapter 13 bankruptcy, or even an emergency bankruptcy filing, we are ready to help. For a free consultation, call (215) 701-6519, or contact us online today.
The Benefits of Filing Bankruptcy
The primary benefit of filing for bankruptcy is, of course, debt reduction and/or elimination. However, in addition to mitigating financial debt, bankruptcy also offers other, less commonly known advantages as well. Some of the additional benefits of filing for bankruptcy include:
1. Eliminating Many Different Types of Debt
Bankruptcy may allow you to wipe out debts from credit cards, medical bills, personal loans, and more. You might not realize some of the debts that are dischargeable in bankruptcy. For example, certain income taxes could be eliminated. The criteria are complicated, so it is crucial to work with our experienced Bucks County bankruptcy attorney. In some cases, it is better to pay your delinquent taxes through bankruptcy. Tax debt is usually broken down into two categories: priority and unsecured. Priority debt must be back in bankruptcy. This portion of the debt is usually the principal amount you owe. However, penalties and interest could be categorized as unsecured. Meaning, this part of your tax debt could be discharged.
2. Stopping Creditors from Harassing or Contacting You
When you file for bankruptcy, a legal injunction known as an “automatic stay” goes into immediate effect. An automatic stay serves as a legal barrier between you and your creditors. Debt collectors are usually prohibited from contacting you or taking further collection actions during your case, including any collection lawsuit. As soon as an individual files for bankruptcy, they are protected by the automatic stay. Under an automatic stay, debtors are shielded from any continued creditor contact, are no longer subject to wage garnishment, and will also be granted delays against actions to suspend utility services or to enact foreclosure or eviction. Additionally, the stay could prevent your vehicle from being repossessed. If your car was already taken, you might be able to force a lender to return it if you file a timely bankruptcy. Be sure to contact our Bucks County bankruptcy lawyer immediately if you fear your car will be or was repossessed.
3. Emotional Relief
Just because stress and anxiety cannot be quantified on a bill does not mean they are unimportant. If you are fighting each month to pay your bills, worrying about where the money will come from, or fear you are going to lose your home, you and your family will suffer emotional anguish in addition to the economic strain. One of the greatest benefits of filing for bankruptcy is arguably the confidence, self-esteem, and peace of mind that result from regaining financial control.
4. Delaying Service Shut-offs Resulting from Unpaid Utility Bills
An automatic stay can also postpone utility shut-offs from nonpayment of past bills. If your services have been terminated, filing for bankruptcy is also a way to have your services restored.
5. Stopping Foreclosure or Repossession
Filing for bankruptcy can stop foreclosure on your home or a scheduled sheriff sale. Falling behind on your mortgage can be frightening. As the months add up, the amount of money necessary to cure your default grows more and more. Working with a mortgage lender when you are behind in your payments is never easy. By filing for bankruptcy, you can force your mortgage company to accept a payment plan. In many cases, the only way a homeowner can stop a sheriff sale is by filing for bankruptcy.
Nobody wants their car repossessed. However, there are times when people fail to keep up with their car payments. By filing for bankruptcy, you can stop a repossession from occurring. Depending on how quickly you file for bankruptcy after a vehicle is taken, you could force a lender to return a repossessed car.
There are other benefits available to a debtor when it comes to their car. If you purchased your car at least 910 before you filed bankruptcy, you could potentially lower your monthly car payment. Cars are famous for depreciating quickly and many people are driving vehicles that are worth less than what they still owe on their car loan. Our Bucks County bankruptcy attorney might be able to put your car payment into your Chapter 13 bankruptcy plan and lower the amount to its fair market value. For example, if you owe $6,000 or a car that is worth $4,500, you might be able to pay the $4,500 through your plan while discharging the $2,500 balance due on your loan.
6. Giving You more Time to Catch Up
If you are struggling to keep up with bills and expenses that have spiraled out of control, filing bankruptcy may give you the opportunity to make your payments smaller and more manageable.
7. Getting Started on the Road to Repairing Your Credit
Good credit and bankruptcy may not seem to be a likely pair. In fact, many people hesitate to file for bankruptcy due to concerns about permanent negative effects on their credit. But because bankruptcy “resets the clock” in terms of debt, after a discharge, petitioners become empowered to make timely payments — and in turn, fully repair their credit. In most cases, Bucks County residents who are considering bankruptcy have poor credit. Not taking any action will do nothing to improve your financial situation. Often, filing for bankruptcy is the fastest and most efficient way to start improving your credit.
The Reasons to File for Bankruptcy
The primary benefit of filing for bankruptcy is gaining the opportunity to reduce or eliminate debts you owe. But did you know that, in addition to helping you get your debts under control, bankruptcy can also offer other advantages? Some additional benefits of filing for bankruptcy include:
Delayed Debt collections
When you file for bankruptcy in Pennsylvania, you will immediately be protected by an automatic stay. While your automatic stay is in effect, creditors cannot contact you or continue their efforts to collect debts. As a result, the automatic stay temporarily freezes wage garnishment, foreclosure proceedings, eviction proceedings, and other attempts to collect debts.
In Pennsylvania, when a creditor is awarded a judgment in a collection lawsuit, the court enters an order stating the amount you are required to pay. More importantly, the creditor is granted a judgment lien against your property. This lien means that your once unsecured debt, such as credit card debt or a medical bill, is now secured by your home. If you try to sell your home or refinance, this lien will have to be satisfied. By filing for bankruptcy, you can avoid a judgment lien. Under some circumstances, you can have a lien removed through bankruptcy. If you have any judgment liens, be sure to review them with our Bucks County bankruptcy attorney.
Long-Term Credit Repair
Many people hesitate to file for bankruptcy due to concerns about the negative effects on their credit. However, it is a myth that bankruptcy will permanently hurt your credit score or make it impossible to take out loans in the future. While bankruptcy will initially cause your score to drop, it will be easier to build good credit in the long term with your debts and payments under control.
Credit card companies will view you as a good investment after you receive your discharge. This is because you have little to no debt and you are not permitted to file another bankruptcy for some time. Building credit begins with clearing your delinquent debts. If you try to do that through a settlement or a consolidation loan, it will probably take much longer. Filing for bankruptcy is a way to jumpstart the process. Additionally, the bankruptcy will eventually come off your credit report.
Peace of Mind
Dealing with financial hardship can cause intense stress and anxiety about your future. In addition to the financial benefits, filing for bankruptcy can give you better confidence, self-esteem, and peace of mind as you regain control of your financial situation
The Types of Bankruptcy Available in Bucks County
There are two main types of consumer bankruptcy: Chapter 7, also known as liquidation; and Chapter 13, also known as reorganization. The type of bankruptcy which consumers file for is determined by something called the Means Test. The Means Test calculates a petitioner’s six months of income along with some allowed expenses and federally permitted deductions. All your income is usually included in the means test, including salary, self-employment income, unemployment benefits, contributions, and pensions. Social security is not considered part of your income for the Means Test calculation.
The Means Test will determine your Disposable Monthly Income. This figure will be compared to the household median in your geographical location. If your income is below a certain amount, you will qualify for Chapter 7. If it is higher, you will be required to file for Chapter 13 and pay your unsecured creditors based on your available monthly income.
Chapter 7 Bankruptcy
The most common bankruptcy in Bucks County, and the country, is Chapter 7. Also known as “liquidation” or “straight bankruptcy,” Chapter 7 was designed for people facing overwhelming financial difficulties who have limited assets.
When you file for bankruptcy, either Chapter 7 or Chapter 13, your property becomes part of the bankruptcy estate. In Chapter 7, the bankruptcy estate is available to be turned over to and sold by a court-appointed trustee. This is why it is called a liquidation bankruptcy. However, there are provisions in the Bankruptcy Code and Pennsylvania law that can be used to protect your property. Our Bucks County bankruptcy attorney will use the available exemptions to allow you to keep your property.
When you file for Chapter 7, you can eliminate much of your debt, such as medical bills, personal loans, and credit card debt, within four or five months. Unfortunately, there are some types of debts you are unable to discharge, including alimony, child support, criminal restitution, and some taxes. Student loan debt is only dischargeable in very rare situations.
Chapter 13 Bankruptcy
Chapter 13 is similar in some ways to Chapter 7. A Chapter 13 debtor will file many of the same schedules and documents. The significant differences are the length of the bankruptcy and the bankruptcy plan.
When you file for Chapter 13, you will propose a three to five-year bankruptcy plan that will indicate what creditors are to be paid through your case. A number of factors determine who and how much is paid. First, if you filed to protect your home from foreclosure, you will be required to pay your mortgage arrears through the bankruptcy plan. Similarly, if you have any priority tax debt, it will have to be paid through your bankruptcy. Whether you will be required to pay your unsecured creditors, such as credit card debt or medical bills, will depend on the Means Test, your monthly income, and your non-exempt assets. Our Bucks County bankruptcy lawyer will thoroughly review your circumstances, so that you understand how it impacts your bankruptcy plan.
What are the Requirements to File Bankruptcy in Pennsylvania?
If you wish to file Chapter 7 or Chapter 13 bankruptcy in Bucks County, you will need to meet some basic legal requirements. Some of these requirements must be fulfilled before you file, while others arise during the bankruptcy process. Below, our Pennsylvania Bankruptcy attorneys have highlighted a few important bankruptcy requirements to keep in mind if you are thinking of filing:
You must be at least 18 years old to file for bankruptcy in Pennsylvania.
To file for bankruptcy in Bucks County, you must have been a Pennsylvania resident for at least 91 out of the 180 days before your filing date. Each bankruptcy court has a “jurisdiction” based on its geographical location. Pennsylvania is divided into three separate districts, the Western District, the Middle District, and the Eastern District. If you live in Bucks County, the United States Bankruptcy Court for the Eastern District of Pennsylvania has jurisdiction over your case. Additionally, if you are a Bucks Country resident, your bankruptcy will be served by the Philadelphia Division. This means that if you are required to go to court, your hearing will be held at Robert N. C. Nix Federal Building located at 9th and Market Streets in Philadelphia.
Credit Counseling Requirements
Before you may file for bankruptcy, you must fulfill the federal government’s credit counseling requirement. If you cannot afford the credit counseling fee, you may be able to get a waiver. You may complete the credit counseling requirement online but must choose a program that has been pre-approved by the U.S. Trustee Program, which operates under the Department of Justice. You will need to supply a certificate showing that you have completed the course. If your case is filed without a certificate of completion or a waiver, it will be immediately dismissed. Having your case dismissed early is never a good thing. However, if you were filing to save your home and stop a sheriff sale, an immediate dismissal could cost you your house.
Debtor Education Requirements
After you file for bankruptcy, but before your case is complete, you must fulfill a federal debtor education requirement. Like your credit counseling provider, your debtor education provider must be chosen from a pre-approved list that is supplied by the federal government. As is also true of the credit counseling course, you must obtain a certificate proving that you have completed debtor education successfully. You do not want to forget about this requirement. The last thing you want to do is complete a long Chapter 13 or believe you have discharged all your debt through Chapter 7, only to have your case dismissed at the very end because you failed to complete the debtor’s education.
Bankruptcy Paperwork Requirements
If you decide to file for bankruptcy, you will need to complete and submit various bankruptcy forms. For example, the heart of your case is your voluntary petition for bankruptcy (Form B 101), which outlines basic information like where you live, where you are filing, and which chapter of bankruptcy you intend to file. In addition to the bankruptcy petition, you will also need to complete various statements and schedules.
These schedules list a detailed description of your financial situation as of the date of filing. You will need to include a complete list of your real estate and personal property, your monthly income (from every source), a comprehensive list of your creditors, and your monthly expenses. Additionally, you will have to provide copies of bank account statements, six months of income, mortgage statement, four years of federal tax returns, and various other documents and statements depending on your unique situation. Our Bucks County bankruptcy attorney will work with you to ensure all the necessary documents are included in your filing. A trustee will motion the court to dismiss your case if it is incomplete.
Do You Need a Lawyer to File Bankruptcy in Bankruptcy?
While bankruptcy can improve your financial situation, it can be extremely difficult to complete the process successfully without assistance from a skilled attorney. Bankruptcy law is full of technical language and financial regulations, creating daunting obstacles for people who are unfamiliar with federal bankruptcy laws.
Though it is legal to file for bankruptcy without a lawyer – a process known as a pro se bankruptcy – it is extremely risky to take this approach. Without help from an attorney who knows the ins and outs of filing rules and court procedures, you are in serious jeopardy of making an error that could have catastrophic results for your case’s ultimate outcome.
Do not struggle to interpret complicated rules and regulations on your own – especially not when the stakes are so high. Instead, let the experienced bankruptcy attorneys at Young, Marr & Associates lighten the burden and guide you through the process. From managing your legal documentation to explaining the requirements for completing your case, to helping you make informed decisions about when to file your petition – we are here to make the bankruptcy process smoother and simpler for you and your loved ones.
Filing for Bankruptcy Yourself vs. Using an Attorney
While filing for bankruptcy can be a financial life-saver, it can also be extremely difficult to successfully pursue a bankruptcy discharge without the assistance of a skilled bankruptcy Philadelphia bankruptcy attorney. Bankruptcy law is dense with technical and financial jargon, which often presents a daunting obstacle to people unfamiliar with the language and the regulations of both Pennsylvania and federal legislature.
While it is perfectly legal to file for bankruptcy unassisted — known as a pro se bankruptcy — without the help of an attorney who knows the ins and outs of the complicated filing system and court procedures, petitioners run an extremely high risk of making an error which could have catastrophic results for their bankruptcy’s ultimate outcome.
If you or a loved one is interested in filing for consumer bankruptcy, don’t attempt to wade through the dense administrative work on your own: let the seasoned Bucks County, PA bankruptcy attorneys at Young, Marr & Associates help share some of the burden. We have filed over 5,000 bankruptcy cases in more than 20 years of experience practicing bankruptcy law. Wherever you need to go, Young, Marr & Associates has been there before.
Our Bucks County Bankruptcy Lawyers Can Help
Bankruptcy has an unfair, inaccurate reputation for being the end of financial stability. In reality, bankruptcy is often the beginning of financial stability. By filing for bankruptcy, you can reduce or wipe out the debts that are weighing you down, getting a fresh start on your financial future. Working with an experienced attorney can help you make the most of your bankruptcy while protecting your assets and property to the greatest extent possible.
If you are thinking about filing for Chapter 7 bankruptcy or Chapter 13 bankruptcy in Bucks County, the PA bankruptcy attorneys of Young, Marr & Associates are here to answer your questions. For a free bankruptcy consultation, contact our law offices online, or call Young, Marr & Associates at (215) 701-6519 today.