Chapter 7 Bankruptcy for Consumers
Houston Consumer Chapter 7 Bankruptcy Attorney
Chapter 7 is the simplest and surest form of bankruptcy protection, especially in “no asset” cases in which all of the property you own is exempt from seizure by the bankruptcy trustee. At the Law Office of Margaret Maxwell McClure in Houston, Texas, I offer a free initial consultation to explain how Chapter 7 bankruptcy works and to determine if you qualify.
Under the new bankruptcy laws, you must pass a means test to file Chapter 7 bankruptcy. If your current monthly income is below the adjusted median income in Texas, you automatically pass the means test. Otherwise, you must pass a secondary means test that deducts expenses, such as vehicle loan payments and 401(k) contributions, to determine if you qualify. A bankruptcy lawyer can walk you through the calculation and determine if you qualify.
If you fail both means tests, you can still obtain debt relief by filing Chapter 13 bankruptcy.
Filing Chapter 7 bankruptcy provides you a complete discharge of unsecured debts, such as credit card bills, lawsuit judgments, payday loans and hospital bills. Secured debts (such as home and vehicle loans) must be paid or the creditor can seize those assets and sell them to pay off your loan. However, filing Chapter 7 bankruptcy will enable you to put a temporary stop to repossessions and foreclosures. This can give you the time you need to negotiate with creditors and become current on your loans. If you are significantly behind on your payments, you may need to file Chapter 13 or Chapter 11 bankruptcy to keep those assets.