American law believes that people should have a second chance at financial stability. Bankruptcy is the legal path that debtors can use to cancel debt that they are unable to pay. However, bankruptcy is a complicated process. If the debtor chooses the wrong options, he may be worse off than before. Therefore, hiring a bankruptcy attorney in St. Charles MO, is a sound decision.
Federal law places limits on the relief that debtors can get from bankruptcy. The lawyer will first review the debtor’s income level for the previous six months. If his income is less than the median income for his state, then he can use Chapter 7. If it is larger, and he has at least $100 to put toward his debts, he will be required to use Chapter 13.
Once a debtor is approved to use the Chapter 7 bankruptcy process, he will have to complete a course on personal finance by an accredited instructor. This costs between $30 and $50. Often, a bankruptcy attorney in St. Charles, MO, is an accredited instructor or works closely with one. This ensures that the debtor is able to easily complete this step. A bankruptcy trustee, who was appointed by the judge, will then call a meeting of the creditors. The debtor must attend this meeting. His lawyer can attend with him, and usually does. The creditors may ask the debtor about his financial status, income, and assets. Very few creditors attend this meeting.
The trustee then sells all of the debtor’s possessions that are not protected by law. This varies by state. A bankruptcy attorney in St. Charles, MO, will make sure that the trustee only sells the correct items. The money raised by the sale will be distributed among the creditors. If the debtor has no assets that can be legally sold, then the creditors receive nothing. The debts are discharged. However, bankruptcy does not erase back taxes and student loans. It also requires the debtor to continue to pay child support and alimony.
People who are considering bankruptcy can contact the Law Offices of Steven K. Brown. He will clearly explain all options. Visit their website to know more.
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