How Does A Lawyer Determine What Branch Of Bankruptcy You Should Use?
When you initially meet with a bankruptcy attorney, the lawyer will need some information from you to decide what advice to offer. The advice the attorney provides helps you understand which branch of bankruptcy would be the best for your situation. For a lawyer to provide this advice, they will need to know some details about your finances. Here are the primary ways a lawyer determines what branch of bankruptcy you should file.
Your Income from the Last Six Months
One of the leading factors that affect the branch you should file is your income from the last six months. Your income affects your eligibility with Chapter 7 bankruptcy, which is why your lawyer will ask for proof of income for the last six months. If your income exceeds the Chapter 7 limits, you cannot legally use Chapter 7 bankruptcy. You could use Chapter 13, though. If your income falls under the limits, you can use either branch. Your lawyer will examine several other factors before suggesting one branch or the other.
Your Current Debts
The next factor that affects this decision is the debts you owe. You can receive the best advice from a bankruptcy lawyer if you bring a list of your debts to your initial appointment. When writing this list, include every debt you owe, even the small ones. You can also include debts you think you owe, even if you are not sure about the status. The types of debts you have make a difference with the branch of bankruptcy you should file. If you owe debts that fall into the dischargeable category, Chapter 7 might be the best choice. In other situations, Chapter 13 might be better.
Your Secured Loan Status
The other factor that plays a role in this decision is your loans. Do you have a mortgage or a car loan? If so, are you up to date on the loan payments? If you are current on the payments, you might benefit from using Chapter 7. If you are behind on the payments and risk losing these items, Chapter 13 bankruptcy might provide more aid to your situation. Your lawyer can explain more about how this works.
These are the top three factors that affect the lawyer's advice about which branch of bankruptcy you should file. If you would like to learn the answer to this question, schedule a visit with a bankruptcy law service.