Many people in Massachusetts reach a point where debt is unmanageable. Chapter 7 bankruptcy protection is designed for honest individuals who simply need to start over. Filing for bankruptcy is a strictly regulated legal process, however, according to the federal Bankruptcy Code and Massachusetts law. If you need advice on whether bankruptcy is right for you, an attorney can help.

Your Assets and Debts During Bankruptcy

In Chapter 7 bankruptcy, most of your assets are turned over to your trustee, who will sell them to pay your creditors. Once your bankruptcy is over, you are no longer responsible for those debts. Some debts, like child support, you can’t discharge through bankruptcy, and you can retain some assets like veterans’ benefits.

Filing Requirements

Before you file for Chapter 7 bankruptcy, you need to meet certain requirements. For example, you must complete an approved credit counseling course within six months before filing and present a certificate of completion to the court. If you fail to do so, a court may reject your request.

In order to qualify for bankruptcy, you must show the court your income is below the median for a Massachusetts household of your size. This is called the “means test.” Sometimes, figuring out the size of your household is not easy, and a lawyer can help. For example, you may have children attending college who only live with you part-time. The bigger your household, the greater your income may be and still permit filing for bankruptcy. Even if your income is higher than the median, you may still qualify for bankruptcy if you prove it is not an abuse of bankruptcy protection.

Process of Obtaining Chapter 7

Because bankruptcy is complicated and has serious legal consequences, Massachusetts courts recommend individuals hire a bankruptcy attorney to assist with filing. Your lawyer will help you fill out the official bankruptcy forms and put together supporting documentation. The courthouse staff are not allowed to give legal advice, nor can the judge act as your legal counsel.

You will need to file detailed financial information with the court as part of your bankruptcy petition, including your income, assets, liabilities, expenditures and a list of creditors. Under both Massachusetts and federal law, some of your assets are exempt from bankruptcy liquidation. You may be able to keep your home, your car and most of your wages.

Bankruptcy is a scary thought for many people. But it is a sound option in the right circumstances. To learn more about how an attorney can help protect your interests during bankruptcy, contact Konstantilakis Law P.C.