Cedar Rapids Bankruptcy Attorneys
Helping You Achieve Financial Relief
If you're struggling with overwhelming debt, you may be wondering if there is any way you can resolve your situation. At Howes Law Firm, P.C., we help people just like you understand their financial relief options. Our bankruptcy lawyers focus on Chapter 7 bankruptcy cases for individuals, and we can help you determine whether this form of bankruptcy is your best option.
Why File for Chapter 7 Bankruptcy?
Chapter 7 bankruptcy, also known as "liquidation bankruptcy," can allow you to dismiss most of your debts and start over debt-free. The entire process can take anywhere from four to six months, and offers a relatively straightforward path to debt relief.
Some debts commonly discharged in Chapter 7 include:
- Medical bills
- Credit card bills
- Certain personal loans
- Past due rent
- Certain tax-related debts
- Past-due utility bills
Filing for Chapter 7 will also implement the automatic stay. The automatic stay in bankruptcy will pause nearly all debt collection actions against you, include wage garnishments, contact from creditors, and court proceedings.
Understanding Bankruptcy Exemptions in Iowa
When people hear about bankruptcy, they often fear losing all of their property and assets. However, the state of Iowa allows residents to protect their essential property from bankruptcy liquidation.
Essentially, all property falls into two categories:
- Exempt property - Usually includes essentials you need to maintain a living. Examples include equity in your home, and your retirement accounts. Certain assets are also exempt up to certain value limits such as vehicles, cash on hand, furniture and appliances and money owed to you.
- Nonexempt property - Often includes luxury items or property with high equity over certain limits.
Iowa bankruptcy exemptions include the following:
- Up to $7,000 in a vehicle
- Up to $7,000 of household furniture
- Up to $1,000 of any personal property
- Wedding ring or engagement ring
- One rifle or shotgun
- Alimony and child support
- Cemeteries and burial property
- Insurance benefits
- Pension and retirement benefits
- Veterans benefits
You may claim the above exemptions or additional ones depending on your unique circumstances. Spouses can choose to file together and double the exemption amount.
Qualifying for Bankruptcy
Not everyone qualifies for debt relief via Chapter 7. Whether you can file a Chapter 7 bankruptcy depends on your income and the result of the means test. The means test determines whether your income is truly insufficient to repay your debts without filing for Chapter 7.
If your income falls under your state's median income for households of your size, you can automatically qualify for Chapter 7 bankruptcy. Otherwise, the courts will look over your expenses over the past six months and determine what amount of your expenses are "allowable" or essential. Whatever remains is your disposable income that could potentially be used to repay your debt.
For the means test, you will need to provide the following documents:
- Tax returns
- Six months of employment, income, and investment statements
- Government-issued identification
- Loan statements
- Bank statements
- And more
The trustee may request more information to evaluate your situation. You must consult an attorney before submitting legal documents to court.
Once you have filed the necessary documentation, you will attend a 341 hearing, which allows the trustee to ask questions and verify the details of your bankruptcy case. Then, you will need to complete a debtor education course and file a completion certificate both before and after the actual bankruptcy filing.
Providing Support Throughout Your Bankruptcy Case
At Howes Law Firm, P.C., we believe in providing high-quality legal counsel to those who need it most. We work alongside you to determine whether Chapter 7 bankruptcy is right for you and guide you through the filing process. Our team creates legal strategies backed by over 30 years of combined experience.
Give your bankruptcy case to a team you can trust. Schedule your free initial consultation today.
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