Chapter 7 Bankruptcy Attorney in Kansas City

What is the Difference Between Chapter 7 and Chapter 13?

Are you unable to keep up with repaying your loans, credit card, or medical bills? Bankruptcy may be an option for you. However, chapters 7 and 13 are the most common solutions you can use to reduce or eliminate your debt.

Chapter 7 is the most common type of bankruptcy. It has the following characteristics:

• It does not require a payment plan.
• It does require you to sell or liquidate your assets to pay back your debt from creditors.
• If you file Chapter 7 successfully, you will be discharged from your debt responsibilities.

Chapter 13 has the following characteristics:

• It eliminates by providing you with a repayment plan that allows you to pay back a certain amount of your debt over a three-to-five-year time frame.
• Chapter 13 is beneficial if you can afford to pay back some of your debt and it lets you make more affordable payments.

Deciding between Chapter 7 and Chapter 13 is often a strategic decision based on income level, assets, and long-term financial goals. Chapter 7 allows for a faster resolution by eliminating qualifying debts without requiring monthly payments, which can be ideal for those seeking immediate debt relief. On the other hand, Chapter 13's method of reorganization suits those who need to maintain their assets while making manageable payments. Understanding both options is critical, and our experienced attorneys ensure you make an informed choice tailored to your specific financial landscape.

The bankruptcy process may seem overwhelming. However, the Kansas City Chapter 7 lawyers at Patton & Dean, LLC are here to help determine which type of bankruptcy meets your specific needs. Call us at (913) 203-4786 to discuss your options.

Finding the Right Type of Bankruptcy for You

Filing for Chapter 7 is generally the preferred option for people who don’t have significant assets or income. However, for those with underwater mortgages, valuable assets, or a steady income, Chapter 13 might be a better fit.

Choosing between Chapter 7 and Chapter 13 involves understanding your long-term financial goals and current financial standing. Chapter 7 offers a quicker discharge of debts, allowing for immediate relief, while Chapter 13 provides a structured repayment plan without liquidating assets. Our Chapter 7 bankruptcy attorneys carefully assess these factors with you, ensuring the chosen path aligns with your future aspirations and immediate needs.

At Patton & Dean, LLC, our Chapter 7 lawyers in Kansas City have no hidden agenda to push you toward a particular approach. Instead, we will walk you through your options, discuss the pros and cons of each, answer any questions you may have, and ultimately provide the guidance you need to make an informed decision. We want you to feel comfortable and confident on the road ahead.

• Related: Protecting Your Property in a Chapter 7 or Chapter 13 Bankruptcy in Missouri

Do You Qualify for Chapter 7 Bankruptcy in Kansas City?

Only certain people can qualify to file for Chapter 7 bankruptcy. Generally, you must meet a legal “means test” by demonstrating that your income and assets are below a particular ceiling. This determination can be complex. Therefore, it is crucial to speak with an attorney about your bankruptcy options and whether Chapter 7 is the right approach.

The means test is designed to prevent abuse of the bankruptcy system by determining a debtor's eligibility based on their disposable income. A Chapter 7 bankruptcy attorney at our firm can guide you through preparing accurate financial statements that reflect your situation, increasing your chance of a successful filing. If there are discrepancies or if income has recently changed, it's crucial to address these with professional help to avoid complications.

Understanding whether you qualify also involves a detailed analysis of your debts and assets. Our team provides thorough evaluations to explain your unique circumstances, offering clarity on what debts are dischargeable and how assets can affect your case. This comprehensive examination is vital for determining eligibility and can streamline your progression through the filing process.

How Much Does it Cost to File Chapter 7 Bankruptcy?  

In general, most individuals will pay a $245 filer fee to the court, a $15 trustee fee, plus a $78 miscellaneous administrative fee—a total of $338. The court may also require the completion of a credit counseling course at an additional cost (typically between $20 - $50). In addition to filing fees, individuals may need to pay for legal representation if they do not feel comfortable completing the process themselves. The cost of working with a professional Kansas City Chapter 7 lawyer can vary depending on the complexity and number of assets involved in filing for bankruptcy.

It is also worth noting that individuals who cannot afford the filing fees may qualify for fee waivers through the court. 

To navigate these costs efficiently, our firm provides clarity on potential fee waivers and payment plans that may be available, helping to manage the financial aspect of filing. We work with clients to understand the financial implications and explore all possible reductions in filing costs. Clients must approach this decision with complete awareness of both court-related expenses and any associated legal fees, as this aids in effective financial planning during the transition period.

Key Considerations Before Filing Chapter 7 in Kansas City

Before filing for Chapter 7 bankruptcy, it is important to consider several local factors and regulations. Missouri and Kansas have specific exemptions that can impact your bankruptcy case. For instance, Missouri allows debtors to exempt their homestead up to a certain value, providing significant relief to homeowners. Meanwhile, Kansas is known for its generous homestead exemption, which can protect more real estate value than in many other states. Understanding these nuances can make a critical difference in planning. 

It's also worth considering how local economic fluctuations might affect your financial recovery post-bankruptcy. Kansas City's growing job market presents opportunities for rebuilding financial stability, but you'll need a clear strategy to tap into these prospects effectively. Our team at Patton & Dean, LLC offers insights into local employment trends that could benefit your situation. Partnering with a knowledgeable Chapter 7 bankruptcy lawyer ensures you are making decisions that consider both current regulations and future potential in Kansas City's vibrant economy.

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Common Questions About Chapter 7 Bankruptcy

What Are the Related Fees When Filing for Chapter 7?

The costs of filing for Chapter 7 bankruptcy can vary but typically include several standard fees. Aside from the filing fee of $338, you might also be required to complete debtor education courses, which generally cost between $50 to $100. These courses are essential as they provide guidance on financial management post-bankruptcy. It's advisable to consult with a professional to explore payment plans or potential fee waivers, especially if the financial burden is significant. Our firm offers insights into managing these costs effectively, ensuring transparency and planning throughout the process.

How Long Does a Chapter 7 Filing Process Take?

The Chapter 7 bankruptcy process can take between three to six months from the date of filing to discharge. Initially, you need to complete a credit counseling course, which is a necessary first step. After filing, a meeting of creditors is usually scheduled, allowing the trustee to ask detailed questions about your financial affairs. After meeting the state's requirements and completing budget counseling, you can expect a discharge of debts within approximately 90 days. Understanding this timeline and preparing correctly can significantly affect the efficiency of the process.

Can I Retain Any of My Property in a Chapter 7 Bankruptcy?

An important aspect of Chapter 7 bankruptcy is the potential to maintain certain exempt properties. Both Missouri and Kansas have state-specific exemptions that may allow you to keep essential assets, such as your primary residence, a vehicle, and personal items, up to a certain value. These exemptions are crucial for your financial recovery and the ability to rebuild post-bankruptcy. Discussing these specifics with a Chapter 7 bankruptcy attorney can help ensure that you maximize the protection afforded under your state's laws.

Will Chapter 7 Bankruptcy Affect My Credit Score?

Chapter 7 bankruptcy will indeed impact your credit score, often resulting in a significant decrease. However, this action can be the first step toward rebuilding your financial credibility. Once debts are discharged, many individuals find they can begin improving their credit score by maintaining new habits, such as paying bills on time and reducing their reliance on credit. With guidance from our attorney team, we can help you strategize a plan for credit repair, setting short- and long-term goals for financial success.

What Happens to Loan Co-Signers in Chapter 7?

Although creditors cannot pursue you for the remaining debt post-discharge, co-signers may still be liable. This risk is a serious consideration and should be discussed before filing. Evaluating options such as reaffirmation agreements or protective measures for co-signers can be imperative. It's advisable to strategize with your Chapter 7 attorney to handle these relationships appropriately, considering both legal obligations and personal ties.

If I Lose My Job Can I File Chapter 7?

Yes, you may file for Chapter 7 bankruptcy if you lose your job or if you are currently unemployed. Even those who received unemployment benefits may file for Chapter 7; however, they qualify no later than 6 months after the loss of employment.

Bankruptcy does not depend on your job status, and many people typically file after losing their jobs. However, before you file, you must also confirm that you actually qualify for Chapter 7.

Unemployment is a significant factor in one's decision to file for bankruptcy since it directly impacts income eligibility under the means test. If you're recently unemployed, our Chapter 7 bankruptcy lawyers will assess your situation carefully to consider both current and projected financial scenarios. We will guide you through documentation requirements and any state-specific exemptions that may be applicable based on your employment and income history, ensuring a thorough evaluation for your filing.

Secure legal assistance quickly by connecting with a Chapter 7 lawyer near you. Call (913) 203-4786 or fill out our online form to move forward.