Alabama Bankruptcy Law Firm

Knowing that you are facing mountains of debt can be a terrifying feeling that constantly causes you stress and worry about your future. If creditors are calling and you are afraid to answer the phone, you have had wages garnished or property seized, foreclosure has been threatened on your home, or you have been affected by any other serious consequences of debt, it is time to take action. If you have met with a financial or legal professional and are unable to devise a smart plan for managing your finances and getting control of your economic situation, bankruptcy may be your most viable solution.

Filing for bankruptcy is a serious undertaking, and while bankruptcy may provide you with the relief you need, it is not without consequences. If you have questions about bankruptcy or need guidance during the bankruptcy filing process, call the law offices of Haygood, Cleveland, Pierce & Thompson, LLP, for legal help you can count on.

Filing for Bankruptcy – The Basics

The majority of people who file for bankruptcy have such excessive amounts of debts that there is a very slim chance that they will be able to conquer that debt in the near future. Bankruptcy provides a legal way of alleviating or managing debt. Bankruptcy is not for everyone, as bankruptcy can have very serious financial consequences.

There are two primary types of individual bankruptcy. These are:

• Chapter 7 bankruptcy. Chapter 7 bankruptcy, also called liquidation bankruptcy, is for those who are in true financial trouble. This type of bankruptcy is designed to discharge certain debts, and then liquidate the debtor’s assets in order to pay creditors. Under this type of bankruptcy, the individual does not create a plan to pay back debts, but as such, may be unable to keep many assets. In order to file for Chapter 7 bankruptcy, a debtor must pass a means test. The means test is designed to determine whether or not an individual is truly low income, and therefore eligible to file. If you earn an income, you may be unable to file for Chapter 7 if your income is greater than the median income for a household of your size.
• Chapter 13 bankruptcy. Chapter 13 bankruptcy,on the other hand, is a type of bankruptcy that allows the debtor to pay off their debts via a payment plan. While the downside of this type of bankruptcy is that that you will need to pay off many of your debts, the upside is that as a result, you may be able to keep more of your property, such as a home or car. Chapter 13 is a better option for those who own certain property types, have a job, and are able to take some steps towards paying off their debts.

Debts that Are NOT Dischargeable Under Bankruptcy

One of the most common misconceptions about bankruptcy is that if a person files for bankruptcy, they will automatically have all of their debts forgiven, and be able to move forward with a clean slate. While it is true that many debts are dischargeable, certain debts cannot be forgiven. Indeed, you will not be able discharge debts such as:

• Child support payments;
• Student loan debt;
• Court fees;
• Tax debts; and
• Any debts that exist from a previous bankruptcy filing.

If you are unsure about what debts you may be able to discharge, as well as what assets you may be able to keep, you should consult with an experienced bankruptcy attorney in Alabama as soon as possible.

The Consequences of Filing for Bankruptcy

While filing for bankruptcy may be one of the best options available to you to help you get control of your financial situation, you should know that filing for bankruptcy is not without consequence. If you file for bankruptcy:

• The filing will remain on your credit report, seriously lowering your credit score;
• You will probably be unable to secure a mortgage, new credit cards, or loans in the near future; and
• You may have difficulty pursuing other endeavors or securing housing due to your low credit score.

Again, bankruptcy is not something to take lightly. It is a last-resort option that is only appropriate in situations where there are few other options.

Alternatives to Bankruptcy

Before you rush into filing for bankruptcy, you should consult with a professional to discuss any alternatives to bankruptcy that may be available to you. Potential alternatives to bankruptcy might include:

• Negotiating with your creditors;
• Seeking credit and debt counseling;
• Consolidating your debt; and
• Creating a debt management plan.

What Are the Benefits of Working with an Alabama Bankruptcy Attorney?

There are few things as stressful and worrisome as being crushed by mountains of debt. If you find yourself extremely worried about how you will pay back your debts, if you have thousands of dollars’ worth of debt that you owe to different creditors, and if you are at risk of losing property or assets, you may be thinking about bankruptcy. When you meet with a bankruptcy attorney in Alabama, your attorney will review your financial situation, explain to you the different options for managing debt, help you to decide whether bankruptcy is right for you, assist you in making sense of the different types of bankruptcy, and handle the legal elements of the bankruptcy filing process on your behalf. An attorney can also negotiate with creditors and help you understand your rights in regards to debt collection practices.

Contact the Law Offices of Haygood, Cleveland, Pierce & Thompson, LLP, Today for Your Initial Consultation

Don’t wait any longer to meet with an attorney if you are drowning in debt. At the law offices of Haygood, Cleveland, Pierce & Thompson, LLP, our experienced Alabama bankruptcy attorneys are here to represent you. Call our offices a (334) 821-3892, or send us a message online today.

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