Cadiz, KY Bankruptcy Lawyer

Cadiz, KY Bankruptcy Attorney

Debts can be as emotionally burdensome as they are financially. Being in a position where filing for bankruptcy becomes necessary can be difficult. For comprehensive and compassionate legal counsel, consult a Cadiz, KY, bankruptcy lawyer from Michael J. Thompson, Attorney at Law. They can help you navigate this complicated legal process.

How Does Bankruptcy Work in Cadiz, Kentucky?

While filing for bankruptcy can feel deflating, bankruptcy laws can actually help individuals who have more debts than they can pay. They are meant to offer a ‘fresh start’ by relieving the financial burden of your debts. Some cases allow debtors to repay creditors through the establishment of repayment plans, while others involve the liquidation of property owned by the debtor.

Here are a few of the basic steps you should know when filing for bankruptcy in Cadiz, KY:

• Gather your paperwork – This paperwork includes documentation of all major financial transactions you made in the two years before filing, monthly expenses, debts, and property. Paperwork covering tax returns, real estate deeds, possible car titles, and loan documents is also necessary.
• Decide on using federal exemptions or Kentucky’s state exemptions – You are only allowed to use one kind of exemption list for your property.
• The petition – A bankruptcy filing requires a two-page petition, along with other forms known as ‘schedules,’ which you will file through your Kentucky district bankruptcy court.
• Filing bankruptcy – While it is possible for you to file for bankruptcy on your own, it is highly beneficial to have the guidance of an attorney during this process. Depending on what kind of bankruptcy you are filing (Chapter 7 or Chapter 13), there are different fees and requirements.

Filing for Chapter 7 vs. Chapter 13 Bankruptcy

There are four different kinds of bankruptcy you can file for in Kentucky, but most individuals file for Chapter 7 or Chapter 13 bankruptcy. Chapter 7 bankruptcy, known as a ‘straight bankruptcy,’ petitions the court to wipe out your debt by giving up your non-exempt property. Chapter 13 bankruptcy allows for a debtor to repay all or some of what is owed to debtors by creating a three- to five-year repayment plan. Some of the key differences between Chapter 7 and Chapter 13 bankruptcy are:

• Chapter 7 – Chapter 7 bankruptcy is cheaper to file, and you will not have to repay creditors. However, people with more assets are at risk of losing them if the value of their assets exceeds the amount of their debt.
• Chapter 13 – Chapter 13 bankruptcy is more expensive to file, and the payment structure of its repayment plans allows for large monthly fees. It also allows debtors to catch up on late payments, which can protect assets like your home and car from foreclosure and repossession.

Chapter 11 bankruptcy is used primarily by businesses, while Chapter 12 is reserved for farmers.

Bankruptcy Provides Protections

Filing for bankruptcy offers some protections for debtors concerning what can and cannot be liquidated. Exemptions are assets that cannot be liquidated to repay your debts.

When filing for bankruptcy, you must consider the differences in exemption lists at the state and federal levels. Unfortunately, you are not allowed to use exemptions from both lists or mix and match exemptions. You must decide and abide by the exemptions on one list. After looking at all your assets, a Cadiz, KY Bankruptcy Lawyer can help you decide which exemption list is better for you.

Protecting Your Property

Through bankruptcy laws, you will not lose everything. The purpose of exemption laws is to make some assets exempt from liquidation.

• Exempt property vs. nonexempt property – Exempt property varies by situation, but it can include basic household items and one car.
• Doubling exemptions – Typically, two spouses who file bankruptcy together can double the exemption amount for shared property.
• Federal exemptions and state exemptions – Individuals filing for bankruptcy must choose between using federal exemptions or state exemptions. They are not allowed to use both or mix and match exemptions from both.

Non-dischargeable Debts

Some debts cannot be wiped out (or ‘discharged’) by filing for bankruptcy. For example, some student loan debts cannot be discharged unless the court decides that requiring payment would be an undue hardship for the debtor. Other debts that bankruptcy will not typically cover are:

• Child support payments and alimony
• Loans you got through giving intentionally falsified information to a creditor
• Unpaid mortgages
• Debts you have not listed on your petition for bankruptcy

These terms may have caveats, so it is important to speak with an experienced Cadiz, KY Bankruptcy attorney to make the most of your exemptions.

FAQs

Q: Can I File for Bankruptcy and Keep My House in Kentucky?

A: It is possible for you to keep your house if you file for bankruptcy in Cadiz, Kentucky. Bankruptcy exemptions typically cover assets, including a person’s residence, that are necessities of life. However, declaring bankruptcy will not keep you from losing your house if it is already in foreclosure due to missed mortgage payments. Foreclosure becomes more complicated when bankruptcy occurs, but it can be better managed with an attorney’s guidance.

Q: Can You File for Bankruptcy Online in Kentucky?

A: You cannot file for bankruptcy online in Kentucky as an individual. The forms to file bankruptcy are available to download online, but the filing must be done in person at a bankruptcy court. The exception to this rule is if you are “ECF Certified.” ECF (or Electronic Case Files) is the primary method of filing documents with courts. Bankruptcy attorneys are ECF certified.

Q: How Many Times Can You File for Bankruptcy in Kentucky?

A: How often you can file for bankruptcy in Kentucky depends on what kind of bankruptcy you are filing. You cannot file for Chapter 7 bankruptcy until eight years have passed since an earlier filing of Chapter 7 bankruptcy. If you have already filed for Chapter 13 bankruptcy, you must wait six years before filing for Chapter 7 bankruptcy. There is no limit to how many times you can file.

Q: How Do I File for Chapter 13 Bankruptcy in KY?

A: To be eligible to file for Chapter 13 bankruptcy in Kentucky, you must have less than $2,750,000 in debts as of the filing date. Filing begins with a petition as well as:

• A list of creditors and accompanying debts
• A list of the debtor’s property
• A breakdown of the debtor’s monthly expenses
• The source, frequency, and amount of income earned by the debtor

Contact Michael J. Thompson, Attorney at Law

You do not have to be alone during this process. Consult a Cadiz, KY bankruptcy lawyer today to discover how we can help you through this time of financial strain.