Oklahoma Bankruptcy HelpTulsa Bankruptcy: How to Hit the Reset Button

What is Chapter 7 Bankruptcy? Chapter 7

Getting a fresh financial start can feel a lot like hitting a reset button and starting over. It can feel like a huge relief after a continual flow of harassing phone calls, letters and threats over unpaid bills.

The U.S. Bankruptcy Code allows for two major types of bankruptcy relief for individuals: liquidation, commonly called Chapter 7, and reorganization.

Chapter 7 allows a debtor to effectively hit the reset button. Once a debtor files for relief under Chapter 7 of the bankruptcy code, a trustee is appointed to the case. It is the trustee who reviews all of the debts, assets, and income of the debtor. The trustee gathers all of the debtors “nonexempt” assets, liquidates or sells them and uses the proceeds to pay off the debtor’s creditors. Any remaining “qualifying” debt is discharged. in most Chapter 7 cases, there are no “nonexempt” assets available for distribution to creditors. The debtor can keep certain “exempt” property in a Chapter 7 filing.

Guided by an Oklahoma bankruptcy attorney, filers can avail themselves of Oklahoma’s broad Chapter 7 exemptions. Financial Freedom Bankruptcy clients in most cases need not lose any assets in the liquidation process. Chapter 7 filers often enjoy a full discharge of all of their unsecured debts.

Filing

A debtor must file a petition for bankruptcy relief together with: schedules of assets and liabilities, a schedule of current income and expenditures, a statement of financial affairs, and a schedule of executory contracts and unexpired leases. (Fed. R. Bankr. P. 1007b). It is likely that the trustee will also request your most recent tax return. (11 U.S.C. § 521)

Eligibility for Chapter 7 bankruptcy in Oklahoma depends on passing a means test. The means test evaluates your ability to repay debt by examining your household income, the number of dependents you support, your expenses and any assets you may have. If you do not pass the means test, you will not qualify for a Chapter 7 bankruptcy.

A consultation with one of our expert attorneys can quickly establish if you are presumptively qualified for Chapter 7. Call Freedom Financial Bankruptcy Lawyers of Tulsa at (918) 786-9600 to learn if you are qualified for Chapter 7 discharge.

If you qualify for Chapter 7 relief, you will need to pay a filing fee and undergo credit counseling prior to filing. Both of these are requirements of the court.

What Are Exempt Assets?

Under the bankruptcy code, certain types of property are considered to be exempt. That means that they cannot be sold or given to your creditors. You retain them after the bankruptcy is completed.

Your primary residence, your household furniture, domestic items used in your home on a daily basis, some jewelry, clothing and your automobile are all exempt to various extents. Pensions, IRAs, 401(k) accounts and other retirement accounts may be exempt. A skilled, experienced and dedicated Oklahoma bankruptcy lawyer can advise you which assets are exempt and how to make the most of your exemptions under Oklahoma bankruptcy law.

What Does it Mean to Discharge Debt?

A discharge releases individual debtors from personal liability for most unsecured debts and prevents the creditors owed those debts from taking any collection actions against the debtor. You no longer owe the debt.

However, secured debts are treated differently under Chapter 7. If you wish to keep a car that you still owe money on, for example, you may decide to “reaffirm” the debt. A reaffirmation is an agreement between the debtor and the creditor that the debtor will remain liable and will pay all or a portion of the money owed, even though the debt would otherwise be discharged in the bankruptcy. This allows the debtor to keep the car or other secured property so long as the debtor continues to pay the debt.

Reaffirmed liabilities remain enforceable. It is important that you continue to pay these liabilities if you wish to keep this property.

As soon as you file for bankruptcy relief under Chapter 7, your creditors must stop contacting you about the debt you owe. The filing itself acts as a stay, prohibiting them from further debt collection efforts. If they continue to contact you wrongfully, you may have a claim against them for unfair debt practices. Our attorneys can advise you regarding any potential claims you may have.

Initial Debt Relief Analysis: Tulsa Bankruptcy Lawyer

To see if you qualify for debt relief under Chapter 7, contact a Tulsa bankruptcy attorney at Freedom Financial Bankruptcy Lawyers of Tulsa as soon as possible.

We can quickly assess your particular situation and advise you regarding eligibility and costs. After learning about the process, if you decide that bankruptcy is the best way to move forward, we can schedule an appointment to begin an affordable bankruptcy filing.

To receive your low-cost initial bankruptcy analysis, call Freedom Financial Bankruptcy Lawyers of Tulsa today at (918) 786-9600.

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