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What Is Bankruptcy?
Bankruptcy is a legal process in which you ask the court to relieve you of some or all of your debts. You can file for personal bankruptcy or business bankruptcy.
Topics we’ll cover in the following video:
- When to consider bankruptcy
- Pros and cons of filing bankruptcy
- How bankruptcy affects your credit
Types of Bankruptcy & Debt Relief
Multiple types of bankruptcy can benefit individuals and businesses, and choosing the right one is important. LHA can evaluate your specific situation and help you decide the right path for you.
Call Our Bankruptcy Attorneys To Explore:
- Chapter 7 Bankruptcy/ Debt Elimination
- Chapter 13 /Debt Repayment & Reorganization
- Bankruptcy Law
- Bankruptcy FAQs
Call 888-726-3181 for a free, no-risk & no-obligation consultation.
Not Just Any Debt Attorney
Columbus bankruptcy lawyer Jeremiah E. Heck is a leader in consumer debt law. He is a founding partner of the bankruptcy law firm Luftman, Heck & Associates.
“My experience with Luftman, Heck & Associates has been very positive. They have been very professional throughout the course of the cases in which they represented me. I can’t thank LH&A enough for their services and being straight forward with me on what to expect throughout the process.”
When facing overwhelming debt, bankruptcy can give you a way out. It can allow you to eliminate or manage your debt in a way that fits your budget. Instead of continuously making minimum payments that often get you even further behind, bankruptcy can help you start over.
What Debts Can (and Can’t) Be Eliminated?
The main goal of bankruptcy is to get rid of outstanding debt. While debts can be eliminated through bankruptcy, not all debts are eligible for discharge.
Through bankruptcy, most unsecured debts will be discharged or included in your payment plan. That includes:
- Credit card debt
- Medical bills
- Personal loans
- Collection agency accounts
- Past-due utility bills
- Past-due rent
- Civil court judgments
- Wage garnishments
- Overpayments of some government assistance and social security
- Attorney fees
There are some exceptions. For example, it cannot be discharged if a civil judgment was based on fraud.
Some debts that cannot be immediately discharged include:
- Student loans (unless you can prove undue hardship or disability)
- Alimony and child support
- Unpaid taxes (unless they are several years old)
- Debts for willful and malicious injury to person or property
- Personal injury damages due to DUI
The Cost of Bankruptcy
Filing for bankruptcy does come with some costs, including:
- Mandatory pre-filing credit counseling (usually around $30)
- Court filing fees (potentially avoidable)
- Mandatory debt financial management course (usually about $20)
- Fees for preparing, copying, assembling, and mailing forms
- Costs for gathering information for your case
- Attorney costs and other fees
An experienced Ohio bankruptcy attorney can help you save money in the long run. They work to preserve your property, reduce payments, and ensure you don’t spend more than you must.
When To Consider Bankruptcy
If your debt is overwhelming and you cannot keep up, then bankruptcy may be the best option. Filing for bankruptcy might be the right choice if:
- Monthly expenses are always more than your monthly income
- You rely on credit for necessary expenses
- You cannot make minimum payments on loans and credit cards for multiple months in a row
- You miss one or more debt payments
- Creditors are garnishing your wages
- Your creditors have threatened to sue you or take you to court
- A debt collection attorney has contacted you
Pros & Cons of Bankruptcy
Pros of Bankruptcy
Through bankruptcy, you may benefit from:
- Avoiding repossession of property, including vehicles
- Avoiding home foreclosure and eviction
- Having utilities turned back on
- Stopping collection actions and lawsuits
- Stopping creditor harassment
- Ending wage garnishment
Cons of Bankruptcy
Some negative aspects of filing for bankruptcy include:
- Bankruptcy is reported on your credit report and lower your score in most cases
- If you earn high income, you may have to pay debt back
- If you have nonexempt assets, you may lose some assets through the liquidation process
- A Bankruptcy petition is a full financial disclosure-it can take some time to gather needed financial documentation for your attorney to review.
Understand Your Bankruptcy Options
Bankruptcy offers a lot to someone in overwhelming debt, but filing is not for everyone. You’re always best served by working with an attorney who can evaluate your overall financial position and recommend which debt relief plan benefits you the most.
LHA Offers Bankruptcy & Debt Assistance
- New Philadelphia
Call LHA Today: 888-726-3181
FAQ About Bankruptcy in Ohio
How Long Does Bankruptcy Take?
The length of time your bankruptcy will take depends on the type of bankruptcy you choose and various other factors. Generally, in a chapter 7 bankruptcy, debts are completely discharged within four to six months after filing your petition. However, Chapter 13 can take between three to five years to complete a payment plan.
Can Student Loans Be Discharged?
Typically, no. However, there are situations where student loans may be discharged. For example, if you can prove undue hardship or complete disability, you may be able to get rid of your student loans.
Can I Keep My House & Car?
Most of the time, you will be able to keep assets like your house and car if you file bankruptcy. There are certain exemptions for assets like these to ensure you can maintain a home and life after bankruptcy.
How Will Bankruptcy Impact My Credit?
Filing for bankruptcy does hurt your credit. And while bankruptcy will be listed on your credit report for up to 10 years. A negative item on your credit report stays on for 7 years. That does not mean you are not able to do anything credit-wise for 7 to 10 years. It just means if someone is considering lending to you, they will take into account that you filed a bankruptcy. This can lead to higher interest being charged in the short-term.