Chapter 7 Bankruptcy Lawyers in Texas
At Leinart Law Firm, we believe that eliminating debt is an important step on the road to achieving financial freedom. For more than 15 years, our compassionate, knowledgeable team of bankruptcy lawyers in Dallas and Fort Worth has helped thousands of clients find a clean financial slate through Chapter 7 bankruptcy.
What Is Chapter 7 Bankruptcy?
Chapter 7 is a type of bankruptcy that can wipe out various forms of debt. It lets you discharge unsecured debts such as medical bills, credit card debt and personal loans. Many people are hesitant to file Chapter 7 bankruptcy because they think their property will be sold. This is simply not the case — most who file Chapter 7 bankruptcy do not have to give up any property. Once your debts have been discharged through a Chapter 7 protection plan, you are no longer responsible for those debts.
However, it’s important to note that if you are significantly behind on your mortgage or car payments, filing Chapter 7 bankruptcy in Texas may not shield you from foreclosure or repossession. If one of your goals is to save your home or car, our bankruptcy attorneys can take a comprehensive look at your financial situation and advise you on whether filing Chapter 13 bankruptcy may be a more advantageous option.
Qualifying for Chapter 7 Bankruptcy
If your income is equal to or below the state median income level, you are most likely eligible to file for Chapter 7. However, if your income exceeds the state median income level, you may be required to undergo means testing. The purpose of means testing is to determine whether you can repay some of your unsecured debt. Sometimes, there are exceptions concerning eligibility as determined by the court. Before filing Chapter 7 bankruptcy, you must also complete a credit counseling course with an approved credit counseling agency.
The main goal of Chapter 7 is to provide a debtor with a fresh start. Chapter 7 works best for people who:
- Have a lot of credit card debt and/or medical bills
- Are flooded with collection calls and notices
- Don’t have enough income to pay off bills
- Don’t own much property or are current on house and car payments
- Have a low credit score
Our bankruptcy law firm offers a complimentary consultation and evaluation of your income, assets and debt. We can determine whether you meet the requirements for filing Chapter 7 bankruptcy.
Texas’ Chapter 7 Bankruptcy Filing Fees
Upon filing your bankruptcy petition, you will have to pay a bankruptcy case filing fee of $338, plus any applicable attorney fees. When a petition is filed, an automatic stay goes into effect stopping most, if not all, collection activity. The benefits of the stay, however, are subject to the bankruptcy code; in other words, it does not always apply to every debt, and may be temporary in some cases.
Not long after the petition is filed, the court’s bankruptcy trustee will hold a meeting for the creditors to make sure there are no objections. Once the petition is approved, it is just a matter of months until all eligible debts are completely discharged.
Information Required to File Chapter 7 Bankruptcy
One of the most time consuming parts of filing for bankruptcy is gathering all the information that is required. Generally, you’ll want to create an inventory of all your assets and their fair market value. This may include:
- Annuities and CDs
- Checking and savings accounts
- Profit sharing accounts
- Pension, 401k, IRA, or other retirement accounts
- Insurance policies, stocks and corporate or government bonds
- Houses, land, condos and vacation homes
- Motor vehicles, watercraft and aircraft
- Jewelry and clothing
- Furniture, computer equipment, electronics and other household goods
- Deposits you’ve placed with landlords and utility companies
- Collectible items such as antiques, books, art, etc.
- Sporting equipment, photographic equipment and firearms
- Any money that is owed to you, such as tax refunds, outstanding personal loans, etc.
- Divorce property settlement documents
- Alimony and child support
- Any patents, copyrights or trademarks you own
This list helps your attorney determine whether you qualify for Chapter 7 bankruptcy. If you own too many assets, you may have to look at other debt relief options. Regardless, it’s critical to make sure you disclose all of your assets and debts. Attempting to hide them is against the law and any discharge of your debts may be revoked.
In addition to providing a list of your assets, you’ll need to produce a list of liabilities, an income report, your current expenses, a schedule of any existing contracts and leases, a copy of your most recently filed tax returns, proof of credit counseling and a list of exempt property. Any debts that are not listed on your bankruptcy schedules will not be discharged.
Chapter 7 Bankruptcy FAQs
How Long Does Chapter 7 Bankruptcy Take in Texas?
Chapter 7 bankruptcy is usually a fairly straightforward process that can be completed in just a few months. When you file your bankruptcy petition, a bankruptcy case filing fee of $335 must be paid along with applicable attorney fees. Once a Chapter 7 petition is filed, an automatic stay goes into effect, which means that some collection activities such as repossession, foreclosure and wage garnishment are halted. The benefits of the stay are subject to both federal and Texas bankruptcy law and are temporary and do not apply in certain cases. Our bankruptcy attorneys can help you understand which rules and exceptions may be relevant to your case.
After your petition is filed, the court’s bankruptcy trustee holds a meeting for creditors to make sure there are no objections (this is a rare occurrence). Once the petition is approved, all eligible debts are completely wiped out within weeks or months.
Which Debts Are Non-Dischargeable in Chapter 7 Bankruptcy?
There are some forms of debt that are non-dischargeable, such as student loans, alimony, child support, certain types of taxes, criminal fines, fees, and restitution and claims due to an accident caused by operating a vehicle while intoxicated. Debts involving fraud or theft and certain lawsuits or judgments can be disputed.
The person or business that has a claim against you for any of these types of debts must file a formal adversary proceeding within 60 days of your meeting of creditors. Unless an objection is raised by a creditor within that timeframe, most debts can be discharged and completely eliminated.
Can I Keep My Home If I File Chapter 7 Bankruptcy?
With secured debt such as a mortgage or car loan, your obligation to pay is secured by the creditor’s rights to the collateral. If you do not stay current on the debt, the creditor may pursue that collateral. Chapter 7 gives you some important advantages in dealing with your secured debts. In some cases you may have to reaffirm your obligation to paying a debt like a mortgage or vehicle loan. In others, you may be entitled to use state or federal bankruptcy exemptions.
What Are Bankruptcy Exemption Laws?
Texas bankruptcy exemptions are much more generous than federal exemptions. In Texas, someone who files Chapter 7 bankruptcy may be able to keep their home, vehicle, pension and up to $50,000 in personal property such as firearms, livestock and other items. However, there are strict rules as to how these exemptions work, so having an experienced Texas bankruptcy lawyer by your side is essential.
Why Choose the Bankruptcy Attorneys at Leinart Law?
Filing Chapter 7 bankruptcy can give you an opportunity to eliminate the heavy burden of debt, but it’s a big decision that will impact your financial situation for years to come. Our bankruptcy attorneys at Leinart Law Firm help you understand your options and provide the legal guidance you need every step of the way.
Schedule a Free Consultation with a Chapter 7 Bankruptcy Attorney
To schedule a complimentary bankruptcy consultation at Leinart Law Firm, call us in Dallas at 469-232-3328 or in Fort Worth at 817-426-3328. You can also use our convenient chat feature, fill out the contact form on our website or contact us via email. Our Dallas and Fort Worth bankruptcy attorneys serve clients throughout north Texas.