Frequently Asked Questions
How much does it cost to file bankruptcy?
It depends on the type of bankruptcy you file.
Chapter 13 bankruptcy costs include court costs of $310, a credit report fee ($40-$75), a credit counseling fee ($15-$36), a financial management course ($10-$50), and an attorney fee. The attorney fee is set by the court in each district and currently is $3,600 in this district.
Normally, the upfront cost to file will include the court costs, credit report fee, and credit counseling fee. The attorney fee is paid through the plan in monthly installments. The financial management course may be paid for after filing.
Chapter 7 bankruptcy costs include court costs of $335, a credit report fee ($33-$53), a credit counseling fee ($10-$36), a financial management course ($8-$50), and an attorney fee. I currently charge $1,100 for the average Chapter 7. Financing may be available depending on your circumstances for a Chapter 7.
If I file Chapter 7, can I keep my house and my car?
Yes, normally you can keep them in Mississippi if you are current on your house and car payments.
Each state has what are called exemptions, which are amounts that the Legislature has determined are yours to keep and are untouchable by your creditors. In Mississippi, the homestead exemption is $75,000, meaning that you can have up to $75,000 equity in your home and your creditors are not allowed to touch it. Therefore, if you own a house worth up to $75,000 or if you have equity up to $75,000, you can keep your house and file Chapter 7. You will, of course, also have to pay your mortgage company if you want to keep the house.
The personal property exemption in Mississippi is $10,000, which means that if your car is worth less than $10,000 or if you have less than $10,000 equity in the car, you can keep your car if you file Chapter 7. You will, of course, also have to pay the creditor for the car to keep it.
Do I qualify for Chapter 7 bankruptcy?
It depends on your income. On October 17, 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 became effective. This law made it more difficult, but not impossible, for someone with above-median income to qualify for Chapter 7 bankruptcy. The median income in Mississippi for a household of one was $35,784 in 2015, the latest figures available. For a household of two, it was $44,832, a household of three was $47,339, and a household of four was $59,126.
If you are above the median income for your household size, there is still a good chance you can qualify for Chapter 7 bankruptcy. Congress devised a long formula to determine eligibility called the means test. To determine if you pass the means test, we must enter six months of household income, deductions from income, some expenses that are allowed under the means test, and secured and priority debts. Most people who are only slightly over the median income and those with large amounts of secured debt will qualify for Chapter 7 bankruptcy.
What is a secured debt?
A debt is considered secured if the creditor has the right to repossess or foreclose on a property if you do not pay the debt. This is called a security interest. Examples of secured debt are mortgages on real property, car loans when the creditor holds the title to the vehicle and notates the debt on the title, and personal loans where you pledge property in return for borrowing money. The last example is normally a small loan company where a person gives the creditor a list of personal property in return for a loan. It has been my experience that customers of these types of places often do not realize that they have placed their property as collateral for a loan and that the loan company can pick up their property if they do not pay their loan.
Unsecured debt is generally credit card debt, medical bills, and check advances where there is no collateral pledged to receive the money or services.
How long will bankruptcy be on my credit report?
Normally, a credit bureau will continue to list a Chapter 13 case for seven years and a Chapter 7 case for 10 years on your credit report.
I have filed for bankruptcy before. Can I file bankruptcy again?
Yes, anyone can file Chapter 13. However, there are limits on how often you can file Chapter 7 and whether you can receive a discharge in Chapter 13.
To file Chapter 7, it must be at least eight years from the date you last filed. If you have previously received a discharge under Chapter 13 and wish to file Chapter 7, it must be a least six years from the date that Chapter 13 was filed.
To receive a discharge under Chapter 13, it must be at least four years from the filing date of your Chapter 7.
Can I file bankruptcy without my spouse?
Yes, a married individual can file bankruptcy without his or her spouse. However, under current bankruptcy law, total household income must be listed, so the non-filing spouse’s income will have to be disclosed. However, neither that person’s name nor Social Security number will be disclosed.
How much will my payments be under Chapter 13?
It depends. There is no way to answer that question without a detailed analysis of your situation. Components of your payment may include your house note, arrearage payment on your house note, your car note, other secured debt payments, taxes, unsecured debt payments, attorney fees, and trustee commission.
Can I borrow money while I am in Chapter 13?
You cannot borrow money while you are in Chapter 13 without approval from the Bankruptcy Court. Generally, if you are asking for permission to borrow for a necessity such as a vehicle if your current vehicle was wrecked, the court will approve the new debt if the Chapter 13 trustee does not object.
Will I ever be able to borrow money after bankruptcy?
Yes, you will be able to borrow money after bankruptcy. Every creditor has its own particular standards to determine whether it will extend credit to an individual. Most creditors use your credit score as a large factor in determining whether to extend credit and most people’s credit score increases after filing bankruptcy.
Do you accept credit cards for payment?
Yes. For family law domestic cases. Processing fees may be charged depending on the fee being paid.
What type of payments do we accept for bankruptcy?
Cash, Money Order or Check. Debit cards can be accepted but a processing fee will be charged. (Average Fee is 4%)
Still, have questions? Please contact us anytime! We look forward to hearing from you.