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Langhorne, PA Bankruptcy Lawyer

While declaring bankruptcy is not a decision that should be taken lightly, it can offer those who have gotten in over their heads a pathway to financial stability. If bankruptcy appears inevitable, having a reliable attorney in your corner is crucial.

The simple fact is that no individual sets out to fall into debt. However, the difficult economic climate has caused people to lose their jobs or see their other sources of income dry up. The good news is that many types of debt can be eliminated through the bankruptcy process. However, depending on your financial situation and other factors, one form of bankruptcy may be more likely to achieve favorable results over another. Our attorneys can explain the benefits of Chapter 7 and Chapter 13 bankruptcy, and guide you through every step of the bankruptcy process.

For a free case evaluation from the Langhorne, PA bankruptcy lawyers at Young, Marr, Mallis & Associates, call today at (215) 701-6519.

How Can a Langhorne, PA Bankruptcy Lawyer Help Me?

While filing for bankruptcy can feel overwhelming and frightening, it does not have to be. Although declaring bankruptcy is a serious decision, it can help those in Langhorne take charge of their financial stability and security. If filing for bankruptcy seems like the next step for you, consult with our bankruptcy lawyers. Our attorney can help you in numerous ways, from getting immediate relief from creditors to devising a plan that works best for your family.

Choosing Bankruptcy Type

In Langhorne, you can generally file for two types of personal bankruptcy: Chapter 7 and Chapter 13. There are fundamental differences between each type of bankruptcy, which, depending on your financial situation, can greatly impact your chances of getting back on your feet. Our lawyers can analyze your debts, assets, and income to help you decide which type of bankruptcy to file for. Choosing the wrong type of bankruptcy can negatively impact your ability to regain financial stability.

Immediate Relief

Once you hire an attorney and file for bankruptcy in Langhorne, an automatic stay will go into effect. An automatic stay prohibits creditors from beginning new collection efforts. This means that your phone should stop ringing and creditor calls should cease. An automatic stay can be life-changing for debtors in need of instant relief. With constant harassment from creditors, it can feel impossible to take a breath and decide which route to take to address your debts. Unfortunately, many Langhorne residents may be unaware of automatic stays and how they can help. Our lawyers can help you file for bankruptcy quickly so that you can take advantage of an automatic stay.

Necessary Support

Filing for bankruptcy can be an understandably emotional time. Those facing bankruptcy may be embarrassed, confused, and overwhelmed by the complicated process of filing for bankruptcy. That is where our skilled attorneys come in. Not only can our lawyers help you navigate the difficulties of bankruptcy, but they can also provide the necessary guidance and support you need to regain your financial stability. Our bankruptcy lawyers can help you understand the hierarchy of your debts and can prepare you for meetings with creditors. We can also handle all the necessary paperwork and stress of filing for bankruptcy so that you can more easily navigate this difficult time.

What is Chapter 7 Bankruptcy in Langhorne, PA?

Chapter 7 bankruptcy is typically the form of bankruptcy that people may have a greater familiarity with in Langhorne. Also known as liquidation bankruptcy, Chapter 7 is the most powerful debt elimination tool. A successful Chapter 7 bankruptcy and discharge can eliminate all or most of your debts. However, there are a number of caveats regarding Chapter 7 bankruptcy that you should learn before filing.

Before you can file for Chapter 7 bankruptcy, you must be able to qualify for it. To determine if your financial situation is a match for Chapter 7 bankruptcy, you must be able to pass the means test. The means test was implemented by the U.S. Congress in an attempt to screen out people who could service a Chapter 13 plan.

The first stage of the means test compares your income to the median income for your state. If your monthly income is less than that of your state’s median income, you pass the means test and are eligible for Chapter 7 bankruptcy. If your income is greater than the median, however, the court will analyze your disposable income. This refers to the money you have left at the end of the month after paying your bills.

After your Chapter 7 bankruptcy has concluded, it can remain on your credit report for ten years. Other drawbacks to Chapter 7 bankruptcy include that it does not always protect some types of property, like homes and cars. Furthermore, Chapter 7 bankruptcy is often not the best choice if a significant portion of your debt is secured and you wish to keep your property. If you have a family, filing for Chapter 7 bankruptcy could risk their comfort and security. To better understand the pros and cons of filing for Chapter 7 bankruptcy, contact our attorneys. Depending on your income and other factors, filing for Chapter 7 bankruptcy can help you regain your footing relatively quickly.

What is Chapter 13 Bankruptcy in Langhorne, PA?

Depending on your family’s needs, filing for Chapter 13 bankruptcy in Langhorne may be preferable. Instead of relinquishing your property, you can pay back creditors according to a repayment plan. Before you can qualify for Chapter 13 bankruptcy, you must confirm that you earn enough income.

Chapter 13 bankruptcy does not require asset liquidation. Rather, under a Chapter 13 plan, the individual and their attorney devise a repayment plan that can last three to five years. In exchange for paying back a greater portion of their debt, a Chapter 13 filer can keep more property than what might be allowed under Chapter 7. Thus, Chapter 13 bankruptcy can lead to superior results for those who wish to protect property.

Once you have completed your repayment plan of high-priority debts, nonpriority unsecured debts may be discharged. Certain unsecured debts are less likely to be discharged at the end of a Chapter 13 bankruptcy. That said, the debts eligible for discharge at the end of a Chapter 13 bankruptcy can be broader than those for Chapter 7 bankruptcy.

After you have paid back all required debts to creditors, your Chapter 13 bankruptcy will remain on your credit report for about seven years. Once again, this can be preferable to Chapter 7 bankruptcy, which can remain on your credit report for longer.

Not everyone can file for Chapter 13 bankruptcy in Langhorne. In order to be eligible for Chapter 13 bankruptcy, you need to pass a different type of means test than that of Chapter 7 filers. In this case, you have to prove that you earn enough to support yourself while paying back creditors according to your repayment plan.

Things to Consider Before Entering Bankruptcy in Langhorne, PA

Before you file for bankruptcy, you should consider a few things. Not all bankruptcy cases are the same, and each debtor has special considerations that might impact their decision to file. Our attorneys can answer your questions about bankruptcy and point out elements that are particular to your case so that you feel comfortable moving forward with bankruptcy in Langhorne.

Your Debt Type

Start by familiarizing yourself with the type of debt you have. Of course, you will know if you owe money to your credit card company or to your mortgage lender. However, these debts have specific categorizations, such as secured and unsecured debts, that dictate how they are treated in bankruptcy. If most or all of your debt is non-priority unsecured, it will be discharged in bankruptcy. If you file Chapter 7, your debt discharge will occur at the start of your bankruptcy case. If you file Chapter 13, your debt discharge will occur at the end of your bankruptcy case. Our lawyers can explain how the court will handle your debts in bankruptcy so that you have a clearer idea of your actual repayment liability to creditors and lenders in Langhorne.

Impact on Credit Score

It is true that filing for bankruptcy will impact your credit score. So, the question becomes, is bankruptcy worth it? Depending on your debt, the answer will likely be yes. The impact of bankruptcy on your credit score will depend on several factors, including your credit score prior to bankruptcy. Furthermore, debtors should understand that bankruptcy will remain on their credit reports for some time after a case is discharged. Remember, Chapter 7 cases remain on credit reports for ten years, while Chapter 13 cases stay on credit reports for seven years in Langhorne. While the impact on your credit score is certainly something to consider, it is worth noting that your credit score might continue to plummet the longer you accrue debt and are unable to repay creditors.

If you are concerned about being unable to make large purchases for some time after bankruptcy and are married, consider the benefits of filing alone without your spouse. When you take this route, your spouse’s credit score will be unaffected by your filing for bankruptcy. Suppose you address all your debts in bankruptcy, including outstanding mortgage or vehicle payments. In that case, you might not have to make large purchases for some time, as our attorneys will aim to protect your home and car from repossession or liquidation.

Asset Liquidation

Many people believe that they will lose all of their assets by filing for bankruptcy. In reality, that does not have to be the case. First, Chapter 13 does not require debtors to liquidate any of their assets to repay their creditors. Instead, our lawyers will devise a repayment plan that works over a period of three to five years. Even if you file for Chapter 7, which is a liquidation bankruptcy, there are liquidation exemptions you can use. Pennsylvania allows debtors to use either state or federal liquidation exemptions in Chapter 7 bankruptcy cases. Such exemptions can enable you to safeguard certain assets from liquidation so that you do not risk losing your home or car during bankruptcy in Langhorne.

Risks of Waiting to File for Bankruptcy in Langhorne, PA

Waiting too long to declare bankruptcy when you are faced with considerable debt can lead to further issues in Langhorne. While many people view bankruptcy as a last resort and put it off for as long as possible, doing so might not be wise.

Bankruptcy can be a frightening prospect for many. Although that is understandable, bankruptcy does not have to be the stuff of nightmares. In fact, bankruptcy is a useful tool for debtors and a way to efficiently and fully address one’s debt. If you wait too long to file for bankruptcy in Langhorne, you risk accruing even more debt. As interest rates kick in and you continue to be unable to repay your creditors, you might require a more extensive repayment plan or risk having to liquidate assets you might have otherwise been able to protect.

Furthermore, falling more into debt puts you in jeopardy of mortgage foreclosure or vehicle repossession. In Langhorne, banks can begin the mortgage foreclosure process after homeowners have been delinquent for 120 days. This means that missing even a few mortgage payments can put you at risk of losing your home in Langhorne. Fortunately, bankruptcy will stop any mortgage foreclosure proceedings or impending sheriff’s sales. This is because an automatic stay will go into effect as soon as you petition for bankruptcy.

How to File for Bankruptcy in Langhorne, PA

Once you have consulted with our lawyers and chosen which type of bankruptcy is best for your financial situation, it is time to file a bankruptcy petition in Langhorne. This process can be confusing and lengthy, so it is best to be prepared for what to expect.

Complete Forms

In order to file for bankruptcy in Langhorne, you must submit legal documents in federal court. Bankruptcy forms can add up to almost 100 pages, containing the details of your financial situation. For example, you must include information regarding your income, expenses, debts, assets, and property. Some forms are specific to the type of bankruptcy you plan to declare, whether it be Chapter 7 or Chapter 13.

Get Credit Counseling

In order to file for either Chapter 7 or Chapter 13 bankruptcy in Langhorne, you must get credit counseling. Essentially, credit counseling exists to educate debtors about debt settlement, budgeting, and financial security. Getting a credit counseling certification and including it alongside your bankruptcy forms is crucial. Our lawyers can help you get a credit counseling certification within 180 days prior to your bankruptcy filing so that your case is not dismissed.

Create a Plan

If you and your attorney decide that filing for Chapter 13 bankruptcy is preferable, you must be prepared to submit a repayment plan along with all other documents. While this repayment plan is subject to change, it is crucial to include and can set the tone for your entire bankruptcy. We can assess your income and debts to devise a repayment plan that will satisfy the court and your creditors.

File in Court

Once you have compiled the necessary information, our attorneys will help you file a bankruptcy petition in Langhorne. All bankruptcy cases are handled in federal court. After receiving your information, the court will decide whether to dismiss your case or approve your plan. Having our attorneys by your side during this process is crucial to increase the chances that the court will approve your petition for bankruptcy, putting you one step closer to financial stability.

Exiting Bankruptcy in Langhorne, PA

Once your bankruptcy case is discharged and you no longer owe debt to any creditors, it is important to use the skills you learned in your credit counseling course to avoid finding yourself in a similar situation at any point in the future.

Debt happens to millions of Americans. While it is easy to fall into debt, it is not so easy to get out of it. Coupled with the information you learned in the credit counseling course you completed prior to bankruptcy, insight from our attorneys can allow you to devise a budgeting plan moving forward. We can help you consider your income and expenses so that you do not reenter debt soon after exiting bankruptcy in Langhorne.

This is important for several reasons. First, building your credit back up after bankruptcy takes time and effort on your behalf. Second, there are mandatory waiting periods between bankruptcy cases so that debtors do not abuse the system and benefit from debt discharges simply because they do not want to repay creditors. So, if you get into debt soon after your case is discharged, it might be several years before you are allowed to file for bankruptcy again in Langhorne.