Bankruptcy
Bankruptcy can be a chance to start over or reorganize as it pertains to your personal life or your business. Attorney Luke Suh can help you determine what form of bankruptcy is best for your circumstances and take you through the process for the best outcome.
Your Chapter 7, Chapter 11 or Chapter 13 bankruptcy filing will involve itemizing income sources, financial transactions, expenses, debts and property. If you are considering Chapter 7 or 13, your income and expenses are subjected to the Ohio Means Test to determine whether you qualify to file.
You will need to understand what property or assets will be sold to pay your debts and what may be exempt from seizure once you file for bankruptcy. At Luke Suh Law, we will take you through your bankruptcy petition step by step to be sure nothing is missed.
Chapter 7
Individuals with limited income may file based on results of the Ohio Means Test. Income level must fall at or below the median level set by the state in consideration with secured and unsecured debt. Assets are sold to pay creditors and remaining debt is discharged.
What you need to know:
- A trustee is assigned to review listed debts and sell non-exempt assets.
- Exempt assets that are not sold include your home, car, insurance and pensions, disability benefits, and tools of the trade, up to a certain value.
- Creditors cannot garnish wages and you cannot be fired or evicted.
- Non-dischargeable debts include student loans, income and property taxes, child support, criminal restitution, and fines owed to city or state governments.
- A co-signer on a loan for which you are responsible WILL NOT be discharged.
- Proceedings are usually complete in 3 to 6 months.
Chapter 13
Also called a reorganization bankruptcy, this as an option for individuals who do not qualify for Chapter 7 bankruptcy. Subject to results of the Ohio Means Test, you may be able to keep many of your assets and arrange a 3- to 5-year repayment plan to your creditors. This can also be an option for some small businesses.
What you need to know:
- Your secured and unsecured debt must not exceed the level set by the state.
- You keep all property and assets, including those listed as collateral for loans.
- A trustee reviews your proposal, interacts with the court, and handles distribution of payments to creditors.
- You must have a steady source of income.
- Your payments may be modified to satisfy all obligations
- Your repayment plan to all creditors may not extend beyond 5 years.
Chapter 11
Also referred to as a reorganization, it is used almost exclusively by commercial establishments, businesses and partnerships, although it also could be used by an individual. It is designed to allow businesses to continue operating while repaying creditors over a longer period of time.
What you need to know:
- There are no limits on level of secured and unsecured debt.
- Proposed plan allows business to keep assets and continue operation while repaying creditors.
- Individual or business is not required to prove income.
- Repayment plans are usually 3 to 5 years, but they may be extended or may initially be set to allow payment for a longer time.
- Does not require appointment of a trustee.
If you need help determining if bankruptcy is the right choice for you or your business, call our office today for a free consultation.