This may be the best time you will ever have, to file your chapter seven or chapter 13 bankruptcy. So I’m going to go over one reason every day, the first four days in this particular series. This is day one and then at the end, we’ll do an overview of all the reasons. So number one, why is now a good time to do your bankruptcy? Your stimulus. So almost all of you would qualify for and have received or will receive a $1,200 stimulus check. And if you have any kids, you get 500 a piece for your kids. So, that’s just about what you need to do a bankruptcy.
I’m just going to reiterate this may be the best time you will find in the foreseeable future and in recent memory to file either a chapter seven or chapter 13 consumer bankruptcy. If you have been wanting to file a seven but your income’s been a little high, making you have to do a 13 and make a payment for five years, my guess is that recent developments will allow you to do that seven.
Anyway, in the midst of the pandemic, I’m just reiterating again, file now. Got your stimulus check. You can pay a bankruptcy, a chapter seven will get rid of all your unsecured debt, and put you in a position to start over fresh without anything hanging over your head.
Stimulus is $1200 per person, $500 for each kid. Given the bankruptcy fees, which I know I personally and many attorneys are discounting based on circumstances at a sympathy for what’s going on with everybody, may allow you to do a chapter seven. You may have the fee and you may not be able to have it at any other time if you’re caught up in a vicious debt circle. In addition, trustees are being forgiving. Your income going down may help you to qualify for a seven if you weren’t able to.
I am hammering home the point, use that stimulus check and the almost perfect conditions we have now to get out of debt for good. How does that work? 1200 for you, 500 per child. My bankruptcy’s generally run anywhere from 1400, 1500 to 1800, 1900 so that stimulus check should put you right in that range. I and many other people are also taking into account the circumstances on a case by case basis and discounting further where appropriate.
Let’s look at how are you can use that stimulus check to get out of debt completely. So how does that work? Well, your typical stimulus, 1200 for you, 500 per child. And my normal rate of bankruptcy depending on the debt and some other factors from 1400-1500 up to about 1900, and I know I and many attorneys are taking into consideration the financial difficulties presented to people now and the fact that they’ve got a stimulus check, but they’ve still got to survive.
Oklahoma City Attorney Edward Kelley discusses if you get to keep your stimulus check even if you’re filing for bankruptcy. The answer will surprise you.
Bankruptcy Attorney Edward Kelley with 888debtline. This impact, I’m going to continue with this emergency series on coronavirus and how it impacts you filing bankruptcy. We’ve already talked about how your income, counterintuitively perhaps, may be at its best for filing a seven or 13.
Remember that when you file a 13, you calculate your disposable income and that’s what you pay for 36 to 60 months, usually 60 if you’re trying to catch up on a home mortgage. Normally, you could do a Chapter 7 or a car payment, then you might choose to do a 13 anyway.
If you’re in the covert 19 crisis, just wanted to post a quick video elaborating on what I’ve already talked about in a couple of videos. There’s always a silver lining to every difficulty and in this case, this may be one of the best times to file a chapter seven. Here’s another reason. If you were on the line about your income, this is a time that bankruptcy trustees and judges are of course being very kind and forgiving.
If you’re needing to do bankruptcy, understand this doesn’t have to stop you at all. One of the amazing things about bankruptcy is that it’s completely e-file. We’ve also received orders from almost all the districts that the 341 meetings, which is the one physical time you have to show up somewhere in a Chapter 7 bankruptcy, will be done by telephone. So actually, if you hire now, you may not have to leave your house at all.
So we’ve already talked about credit cards, personal and signature loans, and medical bills as all being things that you can knock out. And those are good examples of what I’m talking about as a general category, unsecured debts. So just to wrap this up, if a debt, you know when you go into bankruptcy, the biggest classification you’re going to worry about is, are we talking about unsecured or secured debt?
We are going to take a break from our series about debts you can get rid of right away to address this crazy hysteria situation with coronavirus, and why this is probably the best time for you to file bankruptcy. A couple of reasons: number one, which you may not know, all bankruptcy is e-filed and 341 meetings, that’s your little creditor meeting, can be held telephonically in these kind of circumstances.
Certainly signature loans and payday loans, absolutely unsecured, another issue people have signed on their TV and their stereo onto those. I have yet to see anyone try to collect those. Since those aren’t purchased money loans, by nature if you’ve listed something for collateral on that loan that you already own you didn’t use that loan to purchase it. Generally, that defacto lien will be defeated by the bankruptcy.
If a debt is something you can just knock right out, is there any collateral? The case of medical bills, generally not. So just know, and this is something that the collection agents calling you don’t want you to know.
They really don’t have any leverage preventing you from doing a bankruptcy. In most cases, those debts are going to be because you didn’t have insurance, insurance didn’t pay something you thought they would or you got bad insurance. So this is one of also the scenarios that I tell my clients, don’t worry about your conscience here.
Oklahoma Bankruptcy Attorney Edward Kelley finishes up his series on should I do a 7 or 13? So quick in review, first we talked about what’s your income. There are income caps on whether you can do a 7. They’re not hard caps. If you’ve got expenses, unusual expenses that pull you back down under, they use gross income, but they do give you dollar for dollar for your mortgage and for your car payment.
There’s a rule basically in a 13 that if your amount is due immediately for purposes of your creditor, or if the length of a loan that you’re in is less than the length of your plan, then you have to pay that inside the plan. This can hit you with student loans where you don’t have a fixed length, or primarily with taxes, which really aren’t a loan. They’re just a debt that’s immediately due, or defaulted loans that have been called, which essentially are due immediately.
Oklahoma City Bankruptcy Attorney Edward Kelley says, “for example, you’ve got tax debt, if it’s less than three years since you filed it, not dischargeable. Student loans are backed by the government, not dischargeable. Child support, criminal penalties. So you have to think about not only what type of unsecured or secured debts do I have, but is there anything here I can’t discharge? That may or may not push you into one chapter or the other”.
A major consideration in choosing a case is if your debt secured or unsecured. Unsecured debts generally you’d probably like to liquidate them, or I should say you probably like to get rid of them completely in one fell swoop. That’s what the chapter seven liquidation bankruptcy is, you’re giving up your non-exempt assets, which often you don’t have any, so no harm to you, and you get rid of those debts in their entirety instantly, that’s credit cards, hospital bills, anything without collateral.
Oklahoma City Bankruptcy Attorney Edward Kelley 888 Debt Line answers if a 7 or 13 would work better for you. What this comes down to is a simple question. What are the considerations?