Bankruptcy Lawyer Serving Youngstown, OH
Are you struggling under the weight of debts that you are afraid you’ll never be able to pay off? Are you being hounded by creditors day and night? If this sounds familiar, know that you’re not alone. There are options available to you. You could join the millions of others who’ve achieved financial freedom by filing for bankruptcy.
If you are considering filing bankruptcy, an experienced and understanding Youngstown bankruptcy lawyer can evaluate your finances and work with you to make the process as smooth as possible. Our bankruptcy attorneys have decades of experience helping both individuals and businesses emerge from bankruptcy in a more stable financial position. The legal offices of Amourgis & Associates, Attorneys at Law are nearby Youngstown, conveniently located in Canfield, OH. We’re prepared to help you build a personalized debt-relief plan that you can take to your creditors and get you on a better path forward.
The Youngstown bankruptcy lawyers of Amourgis & Associations, Attorneys at Law, are available 24/7 to take your questions and get started on your case. Call us today or visit our contact page for a free initial consultation.
Types of Bankruptcies
There are several different processes for filing for bankruptcy in Youngstown, and the right option for you will depend on the specifics of your situation.
The three most common types of bankruptcy are:
- Chapter 7 – Filing for Chapter 7 bankruptcy is commonly known as a “liquidation” bankruptcy. When you file for bankruptcy under Chapter 7, your non-exempt property is sold off. (“Exempt property” is your assets that are exempt from being sold in bankruptcy – usually things that you need in the course of everyday life.) Once your non-exempt assets have been sold, you’ll work with a trustee appointed by the bankruptcy court to come up with a plan to pay back your creditors using the proceeds from the assets you sold.
A Chapter 7 bankruptcy filing is generally for people who are financially insolvent, meaning they have no real way to pay back their debts. In a Chapter 7 bankruptcy filing, creditors typically end up getting less than the full amount that they’re owed. Once the bankruptcy proceedings are complete, any remaining debts that can be discharged are wiped out by the bankruptcy court. The party filing for bankruptcy is allowed to keep certain assets. These include things like a primary residence, basic household goods, a vehicle (up to a certain value), and retirement accounts.
- Chapter 11 – Filing for Chapter 11 bankruptcy is similar to the process for Chapter 13 bankruptcy in that it’s a reorganization process rather than a liquidation. However, because there are more fees with a Chapter 11 bankruptcy and the process is a bit more complex, Chapter 11 is usually used by businesses instead of individuals. That said, individuals can file for Chapter 11 bankruptcy if they wish.
Filing for Chapter 11 has certain advantages over filing for Chapter 13. There is no bankruptcy trustee in most Chapter 11 cases, and there are no limits on the amount of debt you can have. If you own a business and file for Chapter 11, you will maintain control over the day-to-day operations of that business, though the bankruptcy court will have to approve certain actions.
Once you’ve filed for bankruptcy, you will then put together a plan to pay back your creditors using whatever assets you have left. You can also work with your creditors to reduce your debt burden by extending the repayment period on loans, reducing the interest rate or principle, etc. This plan will then be submitted to the creditors for approval, though the bankruptcy court can still approve the plan if the creditors reject it. After the plan is approved by either the creditors or the bankruptcy court, you will have some of the debts discharged according to the terms of the plan.
- Chapter 13 – A Chapter 13 bankruptcy filing is sometimes known as a reorganization bankruptcy. When you file for Chapter 13 bankruptcy, you create a debt repayment plan that has to be approved by the local bankruptcy court. That plan will outline how you will use any disposable income and other assets you may have to pay off all or some of your debts over a period of three to five years.
Once you have come up with a repayment plan and it has been approved, you will make payments to a bankruptcy trustee. The trustee will then use those funds to pay back your creditors. Once the terms of the plan have been met at the end of the specified time period, the bankruptcy court will discharge any of your debts that can be discharged.
How to File for Bankruptcy in Youngstown, OH
There are many steps involved in filing for bankruptcy, which is a top reason to have a bankruptcy lawyer help you with the process.
Here’s an overview of how the bankruptcy process works:
- Document your income – The first step is to gather your financial records that outline your income. These documents include things like pay stubs, income statements from businesses you operate, and recent tax returns.
- Document your assets – You will also need to show the bankruptcy court what assets you have that could be used to pay back your creditors. To show what assets you have remaining, gather documents like bank statements, the deed to your home, the titles to any vehicles you own, and records of any financial instruments you own, such as an annuity or life insurance policy.
- Document your creditors – You will need to list all of your creditors and how much you owe each of them. This includes things like mortgages, car loans, student loans, personal loans, outstanding medical bills, and credit card debt.
- Credit counseling course – After you have submitted all of your financial documents to the bankruptcy court, you will need to complete a credit counseling course. This is required by Ohio law. This credit counseling course must be completed prior to filing a petition with the bankruptcy court.
- Petition forms – The next step is to fill out the necessary forms with the bankruptcy court. There are certain forms for specific courts, in addition to the standard petition form. You will also need to pay a filing fee, unless your income is less than 150 percent of the federal poverty line.
- Bankruptcy trustee – After you’ve filed the petition, you will be assigned a trustee to oversee your case, except in most Chapter 11 bankruptcy cases. The trustee may ask you for additional documents or information. State law also requires you to take another credit and bankruptcy counseling course after the petition is filed but before the court hearing.
- Bankruptcy hearing – There will be at least one hearing before the bankruptcy court. At the hearing, the trustee will verify the information you submitted in the petition. If any errors are found, you may be asked to submit an amended petition. Your creditors are allowed to attend the hearing, and they may object to having the debts discharged.
- Discharge of debt – After any objections have been satisfied, the next step will depend on the kind of bankruptcy you filed for. In Chapter 7 cases, your assets will be liquidated and used to pay back your creditors, and then your remaining debts will be discharged. In Chapter 11 and 13 cases, the court will approve a payment plan, and any remaining debts will be discharged once the plan is complete.
Debt That Can Be Eliminated in Bankruptcy
Some of the debts that can be eliminated in bankruptcy include:
- Credit card debts
- Medical bills
- Lawsuits and wage garnishments
- Utility bills
- Loans, including payday loans
- Mortgages and mortgage loan deficiencies
- Judgments and liens
- Tax debts
- Driver’s license suspensions and reinstatement fees
What Is the Ohio Bankruptcy Means Test?
Ohio law sets an income limit for people seeking to file for Chapter 7 bankruptcy. This is known as a means test. It seeks to show that you do not have the income to file for a Chapter 13 reorganization bankruptcy. To qualify for Chapter 7 bankruptcy, you must show that your income level is less than the median income for an Ohio household of a similar size.
The actual test involves adding up all your sources of income and then subtracting your allowable expenses from your average monthly income. Allowable expenses include things like housing costs, transportation costs, utilities, food, health insurance, and out-of-pocket medical bills.
If your monthly income level for the next five years does not exceed $7,475, you “pass” the test. If your income is higher than $12,475 per month, you fail and are ineligible to file for Chapter 7. If your income level is between those two amounts, you will have to calculate whether you have enough money to pay at least 25 percent of your unsecured debts during the next five years.
The Truth About Bankruptcy Myths
Here are a few common myths about bankruptcy and the truth about these myths:
- Filing for bankruptcy will ruin your credit forever. Filing for bankruptcy can discharge many of your debts, making it easier for you to pay back your existing creditors and get credit from new lenders once you’ve emerged from bankruptcy.
- You can’t file for bankruptcy if you have a job. You can file for bankruptcy whether you have a job or not. If your wages are currently being garnished, filing for bankruptcy can bring that to a stop.
- Credit card debt can’t be discharged in bankruptcy. Most unsecured debts, including credit card debt, can be discharged in bankruptcy.
- You will lose all your property by filing for bankruptcy. Only certain kinds of assets can be sold in bankruptcy. Basic necessities, including your home, your car, and household essentials, are exempt from being sold off to creditors.
How a Youngstown Bankruptcy Lawyer Can Help
If you’re thinking about filing for bankruptcy, here are a few ways our lawyers can help:
- Explore other options that may be available to you, such as debt consolidation or getting a loan modification
- Find the right type of bankruptcy filing for your situation
- Assist you with gathering all the information you’ll need to file for bankruptcy
- Make sure you take the right required courses as part of filing for bankruptcy
- Ensure all information is filed correctly and representing your interests in court, including handling any objections from your creditors
Do not file for bankruptcy without first speaking to one of our Youngstown bankruptcy attorneys at Amourgis & Associates, Attorneys at Law. Call us today or visit our contact page to learn more about how we can help you return to financial solvency.