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Ch 7

The Different Types of Bankruptcy

A little over a hundred years ago, Supreme Court Justice John Clark McReynolds laid out the intent and purpose of the then-new Bankruptcy Code in Williams v. U.S. Fidelity Guarantee Company (1915): “It is the purpose of the Bankrupt Act to convert the assets of the bankrupt into cash for distribution among creditors, and then to relieve the honest debtor from the weight of oppressive indebtedness, and permit him to start afresh free from the obligations and responsibilities consequent upon business misfortunes.” History has not remembered Justice McReynolds very fondly, but his assessment about consumer bankruptcy was spot-on and is still quoted...

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Chapter 7 Means Test

chapter 7 means test

Qualifying through the Georgia Chapter 7 Means Test Generally, there is one roadblock that stands between debtors and their Chapter 7 discharge: qualifying through the Georgia Chapter 7 Means Test. The most common chapter of bankruptcy filed by debtors is Chapter 7. Chapter 7, outside of certain specific situations, is the more desirable of two types of personal bankruptcy. It is more desirable than the other chapter, Chapter 13, for numerous reasons. First, it is significantly cheaper. Chapter 13 normally requires a monthly payment plan that extends three to five years. The fees for Chapter 13 are much higher than those for Chapter...

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Financial Troubles? When to File Bankruptcy

Bankruptcy filing rates are down overall, but four Georgia counties are among the top ten in the nation in terms of consumer bankruptcy filings. With 1,096 bankruptcy filings per 100,000 people, Clayton County (Jonesboro) is second only to Shelby County in Tennessee. The recession hit folks in Clayton County hard, as unemployment peaked at 13.5 percent in 2010 and remained above 10 percent for several years. Making matters worse, a large grocery store chain recently left the area and took a number of jobs with it. Three other Georgia counties – Henry County (861 per 100,000), Newton County (850), and Douglas...

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Hard-to-Find Answers to Chapter 7 Bankruptcy FAQs

If you are considering filing bankruptcy, you probably have many questions.  Some questions which few sites answer can have a big impact. The Chapter 7 bankruptcy FAQs below can make a large difference in understanding the bankruptcy process and how your specific situation can fit into that process. Q: Will I be able to repair my credit after filing bankruptcy? A: Bankruptcy is not a magic bullet. It will stay on your credit report for 7-10 years. However, depending on your credit situation prior to filing bankruptcy, bankruptcy can vastly improve your credit. While a bankruptcy being listed on your credit report may...

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Bankruptcy and The Gun Toting Debtor

When a person files for bankruptcy, what will happen to their guns?  In Northwest Georgia, guns are a treasured commodity and part of a favored pastime. People are so crazy about guns around here that Wal-mart won't let you buy more than two little boxes at a time.  I asked a Wal-mart cashier why I was not allowed to give more of my money to Wal-mart and allow them to make a profit off of me.  She responded that if there were no limit on ammunition sales, they would never be able to keep any in stock because it flies off...

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Should I Reaffirm My Mortgage in a Chapter 7 Bankruptcy?

As a general rule, I do not think it is ever a good idea to reaffirm a mortgage in a Chapter 7 bankruptcy case.  When you reaffirm a debt, you basically re-obligate yourself on it and make yourself personally liable for something you could have eliminated in a Chapter 7. However, most of my clients insist on reaffirming their first mortgage because they want to rebuild their credit score by making all future house payments on time.  As a Georgia bankruptcy attorney, the reason I am willing to go along with reaffirming a first mortgage in some cases is because first...

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Should You File Bankruptcy Before You Get Married?

Since June is just around the corner, we are getting a lot of calls from potential bankruptcy clients who are asking, "Should I file bankruptcy before I get married?"  Love is in the air.  I can just hear that song right now. Click here if you want to know what song I'm singing. The important bankruptcy questions to consider before getting married are: How would the bankruptcy means test look before you get married? How would the bankruptcy means test look if you waited until after you get married? When a person files bankruptcy, the court looks at the income of the...

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Chapter 7 Bankruptcy – Do I Qualify?

"Who qualifies for Chapter 7 bankruptcy?" About an hour before I wrote this blog post, I spoke to a potential bankruptcy client who was so distressed because one of her friends told her, "You cannot wipe out debt anymore with bankruptcy.  Haven't you heard?  They changed the law a few years ago." I cannot believe that, after all these years, this myth is still being foisted upon people by their own friends!  Don't you just love it when nonlawyers give legal advice?  I think not!  This poor lady suffered great distress because of bad legal advice given to her a by a friend. ...

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Chapter 7 – Break Free From The Cell Phone Contract

Chapter 7 bankruptcy gives you the opportunity to break out of that prison called your cell phone contract.  Chapter 7 bankruptcy is the chance for you to get a  fresh start.  To maximize the benefits of this fresh start, you need to get rid of every debt and liability that you can. A cell phone contract is often one of the most overlooked expenses that can really add up over time. Do the Math You would be amazed at how much money some people spend on a cell phone contract.  I recently met with a couple from Rome, Georgia, who was spending more...

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