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Greenbelt, MD Chapter 7 Bankruptcy Attorney
Lawyer for Chapter 7 Bankruptcy in Greenbelt, Maryland
When debts become overwhelming and repayment seems impossible, Chapter 7 bankruptcy can provide the financial relief needed to start fresh. This type of bankruptcy offers a way to discharge unsecured debts like credit card balances, medical bills, and personal loans. At The Law Office of Donald L. Bell, we help clients navigate the complex process of filing for Chapter 7 bankruptcy. Attorney Donald Bell provides compassionate and knowledgeable guidance through every step of the bankruptcy journey.
Chapter 7 bankruptcy is often considered the most straightforward form of bankruptcy, especially for those with limited incomes and high amounts of unsecured debt. We understand that facing financial hardships can be stressful, but we are dedicated to helping clients take control of their finances through Chapter 7. With our support, you can gain clarity on whether this form of bankruptcy is right for you, and you can take steps to receive the relief you need to rebuild your financial life.
What Is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy, also known as "liquidation bankruptcy," allows debtors to eliminate most unsecured debts. Debtors may be required to turn over some of the assets they own to repay their creditors. However, in many cases, bankruptcy exemptions can be used to protect most or all of a debtor's assets. This is a major misconception about Chapter 7—many believe that they will lose everything when filing, but the truth is that the bankruptcy exemptions available in Maryland are designed to protect a debtor's essential property.
If you have minimal disposable income and are unable to keep up with debt payments, Chapter 7 can help you obtain a fresh start, wiping the slate clean and ensuring that you will be able to avoid ongoing financial difficulties.
The Benefits of Chapter 7 Bankruptcy
Filing for Chapter 7 bankruptcy offers numerous benefits for those who are struggling with unmanageable debt. Some of the most notable advantages include:
- Immediate Relief From Creditor Actions: As soon as a Chapter 7 bankruptcy petition is filed, the court will impose an "automatic stay." This is an order that will prevent creditors from attempting to collect debts or taking actions such as wage garnishments, foreclosure proceedings, repossessions, and harassing phone calls. This provides immediate relief, giving you the breathing room needed to focus on resolving financial issues.
- Discharge of Unsecured Debts: One of the primary benefits of Chapter 7 bankruptcy is the elimination of most types of debts that are not backed by collateral. Once these debts are discharged, you will no longer be legally obligated to repay them.
- Speed of the Process: Unlike Chapter 13 bankruptcy, which involves a repayment plan that lasts for several years, Chapter 7 bankruptcy typically takes just three to six months from start to finish. This can provide a much faster way to achieve financial relief.
- Protection of Assets Through Exemptions: Maryland's bankruptcy laws provide exemptions that will allow you to protect certain assets from liquidation. These exemptions include personal property, retirement accounts, and a certain amount of equity in your home. As a result, many people who file for Chapter 7 bankruptcy are able to keep most or all of their assets while discharging their debts.
- A Fresh Financial Start: By eliminating unsecured debts, Chapter 7 allows you to reset your financial life and move forward with a clean slate. While the bankruptcy will remain on your credit report for several years, you can begin rebuilding your credit shortly after receiving a bankruptcy discharge.
Differences Between Chapter 7 and Chapter 13 Bankruptcy
When considering your bankruptcy options, it is important to understand the differences between Chapter 7 and Chapter 13 bankruptcy, as each type serves different needs:
- Chapter 7: This form of bankruptcy will eliminate most unsecured debts. It is generally best suited for people who do not have the financial means to pay back their debts, even with a repayment plan. The process is relatively quick and allows for the discharge of debts within a few months.
- Chapter 13: This is a reorganization bankruptcy that allows debtors to create a repayment plan over three to five years. Chapter 13 is often chosen by those who have enough income to make payments but need more time to catch up on debts like mortgage arrears. Unlike Chapter 7, Chapter 13 allows debtors to retain more control over assets like their home if they are behind on payments.
While Chapter 13 bankruptcy offers benefits such as the ability to prevent foreclosure and repay secured debts over time, Chapter 7 is often the preferred option for people who have limited income and are primarily dealing with unsecured debts. In many cases, Chapter 7 bankruptcy provides the quickest and most effective way to eliminate overwhelming debt and start over.
The Chapter 7 Bankruptcy Process
Attorney Donald Bell can provide guidance through each step of a Chapter 7 bankruptcy case. He will ensure that you understand the process and that your rights will be fully protected. The process will typically involve:
- Determining Eligibility: Not everyone qualifies for Chapter 7 bankruptcy. Eligibility is determined through a "means test," which compares your income to the median income in Maryland. If your income is below the median, you will typically be eligible to file for Chapter 7. If your income exceeds the median, additional calculations may be used to determine if you qualify.
- Credit Counseling: You will be required to take a course prior to filing for bankruptcy in which you will examine your finances and consider your options for addressing debts and other financial issues.
- Filing the Bankruptcy Petition: Your case will begin by filing a bankruptcy petition with the court. Upon filing, the automatic stay will take effect.
- The Meeting of Creditors: Approximately one month after filing, you will attend a meeting with the bankruptcy trustee where creditors may ask questions about your financial situation. Attorney Donald Bell will help you prepare for this meeting and provide representation to ensure the process goes smoothly. After this meeting, the trustee may take action to seize certain non-exempt assets.
- Discharge of Debts: Once all requirements have been met, the court will issue a discharge of your unsecured debts. This typically occurs within three to six months after filing the bankruptcy petition. Once the discharge is granted, you will no longer be legally obligated to repay the discharged debts.
Frequently Asked Questions About Chapter 7 Bankruptcy
Attorney Bell is here to answer your questions such as the following. Schedule a consultation to discuss your foremost concerns.
Answer: Immediately upon filing for bankruptcy, a person is protected from attempts by most creditors to collect on debts. This protection is known as the automatic stay. A short time later – maybe three to seven weeks later – the bankruptcy filer will need to attend a 341 meeting of creditors (which is very rarely attended by creditors). At this time, the bankruptcy trustee or a representative of the United States Trustee will indicate to the debtor whether the bankruptcy appears to be viable. If all goes well at this meeting, the next step is to wait a few months for the bankruptcy court to issue a discharge of debts that are included in the bankruptcy.
Answer: Many people receive their Chapter 7 debt discharge within about six months of filing. The short time frame is one selling point for Chapter 7. However, the longer time period of three to five years for Chapter 13 should not be the determining factor for someone deciding which type of bankruptcy to choose. Rather, the big picture should be considered.
Answer: For some people, the answer is yes. A more complete answer is that it depends on what types of debt someone is struggling with, such as:
- Unsecured debt: Credit card debts, revolving loans, personal loans, and medical bills fall in this category. Many Chapter 7 bankruptcy filers manage to get all such debts wiped out.
- Secured debt: Chapter 7 bankruptcy can wipe out a home mortgage or a car loan, but lenders may then claim the house or car. Alternatively, the bankruptcy filer can reaffirm these debts immediately after the bankruptcy, resume payments, and keep the house and/or car.
- Undischargeable debts: Unpaid child support, most taxes, and student loans are examples of debts that cannot be discharged in bankruptcy at all.
Getting some or all debts wiped out requires the careful following of the rules of bankruptcy. If something is out of line, the bankruptcy trustee may declare that the bankruptcy cannot go through and will be dismissed. Skillful legal counsel can normally prevent this outcome.
Answer: Someone whose income or assets are too high may not be allowed to file for Chapter 7 bankruptcy. Someone who has much valuable property that they want to keep may opt to file for Chapter 13, instead, so they will not risk losing things that matter a great deal to them.
Answer: The answer to this question will be unique to a person's individual circumstances. There may be compelling reasons to file for one or the other type of bankruptcy. An experienced lawyer will help you determine if you qualify to get a fresh start through Chapter 7. A Chapter 13 reorganization bankruptcy can allow you to keep your assets, such as your home, by setting up a manageable repayment plan. We can help you determine which option will have the most favorable results for your circumstances and life goals.
Contact Our Greenbelt Chapter 7 Bankruptcy Lawyer
At The Law Office of Donald L. Bell, we are committed to providing compassionate support to help clients through the bankruptcy process. Attorney Bell understands the stress that financial difficulties can bring, and he will work diligently to help you and your family receive the relief you need. Contact our firm at 301-614-0535 today to schedule a free consultation to discuss your consumer bankruptcy case. With our help, you can take control of your financial future and move forward toward a brighter tomorrow.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
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Proudly Serving Greenbelt, MD and surrounding areas including Berwyn Heights, Hollywood, Lanham, Seabrook, New Carrollton, Wildercroft, College Park, Silver Spring, Rockville, Bowie, Burtonsville, Largo, Takoma Park, Upper Marlboro, Clinton, Hyattsville, Acredale, Beltsville, Snowden Pond, Ammendale, and White Oak Manor.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
