Memphis Bankruptcy Basics
Being a Memphis bankruptcy lawyer has a unique character in that Memphis has the highest bankruptcy filing rate in the nation. Memphis can also call itself special in terms of bankruptcy with two thirds of the filings being the more difficult chapter thirteens.Chapter 7 dominates the percent of filing nationally with most districts only having about a quarter of filings being thirteens
Chapter 13 requires the repayment of a portion of your debt. The most important feature is that if one is behind on a house or car for example, a Chapter 13 bankruptcy will allow to make up the amount you are behind and keep the property. The plans generally last for five years and involve the debtor paying all of their disposable income either reasonable expense figures or IRS standard expenses to the US Trustee who will dispense the money per the Chapter 13 plan for between three to five years.
Debtors using chapter 13′s can have a success rate under 1/3rd. So why are Chapter 13 plans so frequently used in Memphis? Some try to explain the characteristic with the Christian ethics of repayment. Less generous explanation are that being a less economically gifted area, Chapter 13 offers a way for lawyers to get paid without having their clients to come up with ready cash. Chapter seven fees must usually be collected upfront or they might be discharged.
Tennessee’s four thousand wild card exemption could also be to blame. In some cases it could be that a lapsed chapter thirteen plan could be due to positive causes. It could be attributable to an increase in income or positive change in circumstance causing the debtor to be able to repay the debts and no longer need bankruptcy court protection.
Chapter thirteen includes a fairly onerous continuing documentation requirement . Still keeping property you are behind on would be the only clear circumstance where a chapter 13 would be called for.
A Chapter 7 is the traditional bankruptcy. You don’t keep stuff in excess of the homestead amount, but you get the immediate relief from debt without the necessity for payments. You can usually also keep a home or vehicle in which you are current with the payments.
A debtor should clearly see if they could make the sacrifices required for a chapter seven and a genuine fresh start. Remember much of the consternation with the much talked about bankruptcy reforms was the means test, the central downside was that it required those who have means to file Chapter 13.
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