It’s morally wrong to file for Bankruptcy?

Many people facing bankruptcy feel a strong sense of failure and embarrassment. The banks and even the media would like you to feel it is your fault. The truth is my clients are good people who want to pay their debts but find themselves in a bad situation. Many have found themselves drowning in debt due to no fault of their own. You have a legal right to seek real debt relief under the U. S. Bankruptcy Code. My best advice is to hold off on any moral judgment until you have all the information.  If you would like more information on filing for bankruptcy click HERE to visit my website.

It’s morally wrong to file for Bankruptcy?

Many people facing bankruptcy feel a strong sense of failure and embarrassment. The banks and even the media would like you to feel it is your fault. The truth is my clients are good people who want to pay their debts but find themselves in a bad situation. Many have found themselves drowning in debt due to no fault of their own. You have a legal right to seek real debt relief under the U. S. Bankruptcy Code. My best advice is to hold off on any moral judgment until you have all the information.  More information on Utah bankruptcy can be found at www.dlblaw.com.

WHAT IS THE BANKRUPTCY “MEANS TEST”?

Your eligibility for bankruptcy protection is determined in part by your household income. The Bankruptcy Code requires that you calculate your median income by looking at your gross income earned by you, your spouse and any other working member of your household during the 6 months proceeding the current month. You then have to add up all the income and divide by 6 to arrive at a number. This number is then compared to a median income table provided to us by the Census Bureau and the United States Trustee’s office. This calculation is called the “median income test.”
If you are over the median income, then a presumption of abuse arises as to your eligibility for a Chapter 7 bankruptcy and you must proceed to perform additional calculations (these additional calculations are called the “means test.”).
The addition of the median income and the means test to the consumer bankruptcy process has made bankruptcy a lot more complicated both for lawyers and for individuals. Many lawyers who used to handle bankruptcy cases no longer do so because of the complexity of the median income/means test process. My best advice is to speak with an experienced lawyer about your case. Ask the lawyer how long they have been filing bankruptcy cases for clients and how many cases they file a year. As with most things in life, experience matters. Click HERE for an experience Utah bankruptcy lawyer.

WHAT EFFECT DOES A BANKRUPTCY FILING HAVE ON THE COLLECTION OF CHILD SUPPORT & ALIMONEY?

A Chapter 7 filing should have no effect on such collections.

Although filing bankruptcy stops, or stays, all efforts to collect debts, the Bankruptcy Code excludes actions to collect child support or spousal maintenance from the stay unless the creditor attempts to collect from the property of the estate. In a Chapter 7 proceeding, property of the estate includes all possessions, money, and interests the debtor owns at the time he or she files. Money earned after the bankruptcy is filed, however, is not property of the estate. Since most child and spousal support is paid out of the debtor’s current income, the bankruptcy should have little impact.

A debtor under Chapter 13 must pay all domestic support obligations that fall due after the petition is filed. Failure to do so could result in dismissal of the case.

Neither a Chapter 7 nor a Chapter 13 discharge affects future child or spousal support obligations. In other words, even at the conclusion of the bankruptcy proceeding, these on-going obligations remain. More information on Utah Bankruptcy can be found here.