Bankruptcy lawyers in San Antonio Texas to help you navigate bankruptcy complexities with confidence

Bankruptcy provisions are primarily mentioned under Title 11 of the US Bankruptcy Code, which outlines the various types of bankruptcy filings, the processes involved, and the protections afforded to debtors and creditors. One of the primary purposes of bankruptcy is to provide a discharge of debts, meaning that the debtor is no longer legally obligated to pay certain debts. The specific debts that can be discharged vary depending on the type of bankruptcy filed Below types of bankruptcy cases are frequently dealt with by bankruptcy lawyers San Antonio in Texas.    

Eligibility for bankruptcy can depend on factors like income, type of debt, and previous bankruptcy filings. For Chapter 7, your bankruptcy lawyer in San Antonio will inform you that you must pass a Means Test that assesses your income against the median income in your state. It compares your average monthly income over the last six months to the median income for a similar household in your state. If your income is below the median, you typically qualify for Chapter 7. The goal of the Means Test is to assess whether the debtor can repay a portion of their debts. It also ensures that non-deserving individuals do not take advantage of the bankruptcy provisions and their benefits.  

  

Chapter 7 and Chapter 13 bankruptcies   

If you qualify for Chapter 7 bankruptcy, the bankruptcy court will appoint a trustee to oversee your case and may sell non-exempt assets to repay creditors. As you will be informed by your bankruptcy lawyers San Antonio, there are some exemptions under Chapter 7, such as homestead exemptions and motor vehicle exemptions, personal property exemptions, retirement accounts, public benefits, and wildcard exemptions, that allow debtors to protect any asset of their choosing, up to a certain value. If you do not qualify for Chapter 7, then your bankruptcy lawyers San Antonio would advise you to file for bankruptcy under Chapter 13.  

  

Exemptions under bankruptcy provisions   

In order to qualify for Chapter 13, debtors must have a regular income and meet specific debt limits. As of 2023, unsecured debts must be less than $465,275, and secured debts must be less than $1,395,875. Unlike Chapter 7, Chapter 13 allows debtors to keep their assets, including homes and vehicles, as long as they adhere to the repayment plan, which is of three to five years’ duration, within which the debtor must discharge all of their outstanding debts. The repayment plan requires certain debts to be discharged on priority, such as child support, alimony, and certain tax obligations. Secured debts like mortgages must be addressed, and unsecured creditors may receive a portion of the debt based on the debtor's disposable income.  

  

Chapter 13 allows debtors to keep their assets, including homes and vehicles of certain equity, as long as they adhere to the repayment plan. After completing the repayment plan, remaining eligible unsecured debts are discharged, and the debtor is under no obligation to repay them. If the debtor experiences exceptional financial difficulties during the repayment period, they may be able to modify the plan. A Chapter 13 bankruptcy can remain on a credit report for up to seven years, which may impact the debtor's ability to secure new credit.