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    When Chapter 7 Isn't Your Best Bankruptcy Option

    Last updated 3 days ago

    It can be challenging to determine whether Chapter 7 or Chapter 13 bankruptcy might be best for you. Consider meeting with an experienced bankruptcy attorney to discuss what each type of bankruptcy filing entails. While a Chapter 7 bankruptcy may seem ideal because it involves the quick discharge of many types of debt, it may not be right for everyone.

    When You Do Not Pass the Means Test

    Chapter 7 bankruptcy may not be an option for you if you do not meet the eligibility requirements. To file for Chapter 7 bankruptcy, your income must pass the means test. To pass, your income must fall below the established median level of income for your particular area. The means test also assesses the financial status of those whose income is above this level. This involves evaluating whether you have enough disposable income to pay your creditors during a repayment period. Your disposable income is the money that is left after you pay your allowed expenses. Your total financial status will determine whether you are eligible to file for Chapter 7 bankruptcy.

    When You Have Non-Dischargeable Debts

    Even if you do qualify for Chapter 7, it may not be in your best interests. If your debt consists primarily of non-dischargeable debts that will not be eliminated in a Chapter 7 filing, then Chapter 13 may be best for you. These non-dischargeable debts include child support, alimony, income taxes, student loans, and court judgments.

    When You Have Nonexempt Property

    During Chapter 7 bankruptcy, the bankruptcy trustee will evaluate your property to determine what may be sold to pay your creditors. Exempt property cannot be sold, such as your car and equity in your home. If you have a substantial amount of nonexempt property, your bankruptcy attorney may advise you to file for Chapter 13 bankruptcy. Nonexempt property includes family heirlooms, valuable collections, and investments.

    Let the bankruptcy attorneys at Cutler & Associates, Ltd. help you decide of Chapter 7 or Chapter 13 bankruptcy is right for you. During your free consultation, we’ll explain the ins and outs of each type of bankruptcy, and discuss your best legal options. Those in the Schaumburg and Aurora areas can get in touch with our bankruptcy law firm by calling (847) 505-0380.

    A Look at the Illinois Bankruptcy Homestead Exemption

    Last updated 10 days ago

    If you’ve considered meeting with a bankruptcy attorney, you may be concerned about what could happen to your home after filing for bankruptcy. Most individuals who file for bankruptcy are able to keep their homes. If you’re a resident of Illinois, the Illinois Homestead Exemption may apply to you. This measure can preserve the equity you’ve built up in your home throughout the bankruptcy process.

    If you’re single, you can exempt up to $15,000 of your home and other property that may be covered. If you’re married, and you and your spouse are filing jointly for bankruptcy, you can exempt up to $30,000 of your equity. This exemption is applicable to houses, condominiums, co-ops, and mobile homes. Additionally, you can apply the homestead exemption to sales proceeds for up to one year in the event that you decide to sell your home.

    To learn more about protecting your home while filing for bankruptcy, meet with the friendly team at Cutler & Associates, Ltd. You can reach our bankruptcy law firm in Aurora or Schaumburg by calling (847) 505-0380.

    Requirements for a Chapter 13 Hardship Discharge

    Last updated 17 days ago

    One of the cornerstones of a Chapter 13 bankruptcy filing is the proposed repayment plan. This repayment plan typically lasts for three to five years. During this time period, you’ll make court-ordered payments to your creditors to pay some or all of your debt. At the conclusion of this time period, the remainder of your debts is discharged. However, many individuals find that due to changes in circumstances, it becomes impossible to meet the terms of the repayment plan. If you ever experience difficulty, see your bankruptcy attorney immediately to discuss your legal rights and options. Your bankruptcy lawyer may arrange for a hardship discharge, or cancelation of unsecured debts.

    Repayment Status

    You may qualify for a hardship discharge if you’ve already paid your creditors at least as much as they would have gotten if you’d received a Chapter 7 discharge. As your bankruptcy lawyer can inform you, it’s easier to meet this condition if you have little nonexempt property.

    Uncontrollable Circumstances

    The court may grant you a hardship discharge if you can demonstrate that your failure to meet the terms of the plan is due to circumstances beyond your control. For example, you may need to prove that you have a permanent physical disability that prevents you from working.

    Impossible Modifications

    If you have trouble meeting the terms of the repayment plan, your bankruptcy attorney could ask the court for a modification of the terms. However, if your bankruptcy lawyer can prove that you could not meet the terms of the repayment plan even after a modification, you could qualify for a hardship discharge.

    Important Considerations

    Even if you do qualify for a hardship discharge, be aware that not all of your debts may be canceled. A hardship discharge only eliminates non-priority, unsecured debts. Debts such as child support, alimony, and student loans cannot usually be discharged.

    If you feel you may need a Chapter 13 bankruptcy hardship discharge, the bankruptcy lawyers at Cutler & Associates, Ltd. can help. We invite residents throughout the Aurora and Schaumburg areas to call our bankruptcy law firm at (847) 505-0380. You can also visit our website for more information about our exemplary services.

    Bankruptcy Options for Small Business Owners

    Last updated 24 days ago

    Since everyone’s financial situation is unique, it’s best to consult a bankruptcy lawyer regarding your specific options. In general, however, small business owners may file for Chapter 11 bankruptcy for business entities or personal bankruptcies. Whether you should file for personal or a business entity depends largely on the amount of debt you owe. Chapter 11 bankruptcy enables you to restructure your debt, which will allow you to continue to operate your small business while you pay back your creditors under a court-approved plan.

    If you are a sole proprietor, a better option may be to file for Chapter 13 bankruptcy. This enables you to eliminate your personal liability for your small business’ debts. Small business owners who run a corporation, limited liability company, or partnership may be eligible to file for Chapter 7 bankruptcy. This option may be ideal for you if you wish to shut down your business entirely, liquidate its assets, and discharge the debt.

    The bankruptcy attorneys of Cutler & Associates, Ltd. can help you sort through your bankruptcy options and choose the one that best fits your needs. Small business owners throughout Aurora and Schaumburg are welcome to contact us at (847) 505-0380 to arrange a consultation.

    A Look at Record High Consumer Debt

    Last updated 1 month ago

    Consumer debt has risen five percent from last year, with the average U.S. household owing $15,480 in credit card debt alone – not counting mortgage debt and student loan debt. With sky high interest rates and annual fees, credit cards are a common reason why many people have to declare bankruptcy. It can be very challenging for an individual to pay back a mountain of debt when interest keeps adding to it.

    You can hear more about the latest trends in consumer debt by watching this news clip. You’ll hear the story of Tracy, who found out the hard way that it can be all too easy to rack up excessive credit card debt. You’ll also hear why some banks are allowed to charge unreasonable interest rates and fees.

    If you’re burdened with excessive credit card debt, you may wish to consider declaring bankruptcy. Call (847) 505-0380 to consult Cutler & Associates, Ltd., a bankruptcy law firm serving Aurora and Schaumburg.

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