Scranton, PA Bankruptcy Lawyer

With bankruptcy, debtors in Scranton can face their financial difficulties head-on and overcome them.

To figure out which bankruptcy chapter debtors should pursue in Scranton, our lawyers will review their debts in full, assess their assets, income, and expenses, and consider their preferred timeframes for bankruptcy claims. In general, Chapter 7 is for debtors whose income cannot support a repayment plan, and Chapter 13 is for debtors whose income can. After determining the right bankruptcy chapter for your situation, we will prepare your petition, which will include making a full list of the creditors involved in your case and identifying which liquidation exemptions we will use, if any. If you file Chapter 13, we will draft a repayment plan considering your income and financial ability.

Call the Scranton, PA bankruptcy lawyers at Young, Marr, Mallis & Associates for a free case review at (215) 701-6519.

Choosing Which Bankruptcy Chapter to File in Scranton, PA

A lot goes into choosing which bankruptcy chapter to file in Scranton. Although most consumers can only choose between Chapters 7 and 13, it is not always an easy decision to make. Sometimes, it is not a consumer’s decision at all, based on the results of their means test.

Review Your Debts and Financial History

Our bankruptcy lawyers can start by reviewing your debts in full. In consumer bankruptcy claims, there are secured and unsecured debts. Secured debts are backed by collateral, lessening the risks for lenders. An unsecured debt is not backed by collateral, so these loans often have higher interest rates for consumers. The most common unsecured debt consumers face is credit card debt. Over time, credit card debt might grow considerably due to the high interest rates attached to late payments. Fortunately for many consumers, unsecured debts like credit card debt are dischargeable in bankruptcy. If the bulk of your debt is unsecured, filing Chapter 7 could result in a faster discharge in Scranton.

Comparatively, if you have considerable secured debts that are backed by collateral, lenders could have cause to seize certain assets. Filing Chapter 7 could be a considerable risk in these instances, as debtors might lose their assets to lenders. If you have declared bankruptcy several times in the past, you might have to wait before doing so again, especially if you want a discharge for unsecured debts.

Assess Your Assets and Income

Our lawyers must assess your financial situation to determine which bankruptcy chapter is best for you. We can do this by putting you through a means test. We will first review your household’s income and expenses. If you have several dependents to care for, that might factor into which bankruptcy chapter you ultimately pursue. We will then take inventory of all your assets to identify which ones we need to safeguard with liquidation exemptions if you file Chapter 7.

Generally speaking, if your household’s income is lower than that of the state average for households of a similar size, you should file Chapter 7. And if your household’s income is higher than the average, you could file Chapter 13. Debtors might have some leeway, regardless of a means test’s outcome. That said, a means test will give you a good indication of the right path based on your income and expenses, so it is important to consider the results of a means test even if you can choose another chapter, which not all debtors can. If you want to file Chapter 13 despite the means test’s results indicating that you should file Chapter 7, our lawyers can see if that is an option.

Set Your Timeframe

Bankruptcy chapters take different amounts of time. If you want out of bankruptcy fast, Chapter 7 might be best. Chapter 7 is the shortest option, taking, on average, four to six months to finish. Chapter 7 is so fast because it requires debtors to liquidate assets to repay creditors and lenders. Once you address your secured debts in Chapter 7, the court may discharge your unsecured debts.

If you are comfortable with a longer timeframe to avoid asset liquidation, you could file Chapter 13, provided your income supports this bankruptcy chapter. Chapter 13 bankruptcy cases take considerably longer than Chapter 7 bankruptcy cases, about three to five years. During this period, you will work toward paying off lenders while keeping interest rates low.

Preparing Your Bankruptcy Petition in Scranton, PA

After identifying which bankruptcy chapter to file in Scranton, our lawyers can help prepare and submit your bankruptcy petition to the court.

When preparing your case, our lawyers will create a full list of creditors and identify how much you owe each one. We will categorize your debts accordingly so that the court knows how much secured and unsecured debt you have at the time of filing.

Some debtors need to prepare bankruptcy petitions quickly after being threatened with litigation, repossession, or mortgage foreclosure from lenders. Filing a bankruptcy claim can stop all attempts to collect debt from creditors in Scranton and simplify the repayment process for debtors. We can prepare a thorough petition quickly so that you benefit from the automatic stay that accompanies nearly all bankruptcy cases.

For Chapter 7 filers, our lawyers will identify liquidation exemptions to protect important assets like cars or real estate. Pennsylvania lets debtors use federal exemptions instead of state exemptions, as they are more expansive. For Chapter 13 filers, our lawyers will prepare repayment plans based on their income and debt and submit them to the court for approval.

Our attorneys can also prepare for possible negotiations with creditors or lenders. Depending on the case, we might be able to reduce what you owe or negotiate more favorable interest rates on unpaid amounts so that you can feasibly repay lenders in Scranton.

Call Our Bankruptcy Attorneys in Scranton, PA Now

Call Young, Marr, Mallis & Associates at (215) 701-6519 to get help with your case from our bankruptcy lawyers.