How Do I Know if Filing Chapter 7 Bankruptcy is Right For Me?

Chapter 7 bankruptcyDebtors who seek out consultations with bankruptcy lawyers are often stressed out and confused as to how best to climb out from under the pile of debt that they may find themselves in. Every case involves a different set of facts, so what may be good for one person, may not be good for another. A chapter 7 bankruptcy for many people may be the best option moving forward.

A chapter 7 bankruptcy allows for debtors to discharge most if not all of their unsecured debt which includes credit cards, medical bills, repossessions, or even old apartment dues owed. A chapter 7 bankruptcy even allows most people to retain all of their belongings as long as their assets are within the available exemption allowances. Washington State allows debtors to choose to use the Federal exemptions or the state exemptions. The Federal exemptions allow debtors a large “Wild Card” exemption in which debtors can protect over 11K of assets if filing a single petition or over $21K of assets filing a joint petition. The wild card exemption is on top of any other allowable exemption for household goods, vehicles, tools of the trade among other things. The federal exemptions, however do not allow for a large household exemption, capping out at about $40K of allowable equity in a home. If you have a large amount of equity in your home you will want to opt to use the state exemptions which allow for over $125,000 in equity in a home.

In order to qualify for a chapter 7 bankruptcy, debtors must have an income of below the state median income for their family size. In Washington State, the median income for a household of 1 is a bit over $53K and it goes up to $82,942 for a family of 4. Debtors can choose whether they want to file a joint petition with their spouse or not, however if couples are living together and married, both spouses income must be included in the income calculation. Every case has a unique set of facts, so you should discuss your case with a bankruptcy attorney to learn about what options may be available to you.

If you would like to schedule a free consultation with Symmes Law Group please call 206-682-7975

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