Your Home and Cars Are Safe
Filing a Chapter 7 or 13 bankruptcy will not cause a home or car to be lost as long as a home or car payment is current, or can be brought current within a reasonable time.
Debt Relief/Tax Relief Available to Most in Central Arkansas
It is a popular myth that the changes to bankruptcy law in 2005 made bankruptcy relief unavailable for middle class families. As a result, many families suffer needlessly from oppressive debt problems, not knowing that debt relief is readily available.
Spouse May Choose Not to File
There are times when all unsecured debts are in the name of one spouse and there are no, or very few, unsecured debts in the name of the other spouse. In those circumstances it is often advantageous, and recommended, that the spouse with debt problems file a bankruptcy alone. Therefore the spouse with little or no unsecured debt can remain out of bankruptcy and protect his or her existing credit history, which may be beneficial to the family.
Pitfalls of Debt Consolidation Agencies
Some agencies promote use of their services to obtain a debt reduction agreement with unsecured creditors. However, often these agencies charge service fees that equal about half the amount of debt reduction achieved. For example, an agreement that will obtain a debt reduction of $20,000 probably will result in payment of fees of about $10,000 to the debt consolidation agency. Also, debt reduction agreements damage a debtor's credit history, which cannot be repaired until the debt reduction payment agreement is complete. These agreements usually run from three to five years.
Hot Springs Attorney Providing Tax Debt Relief
It is important to understand that debt, which is written off by creditors under a debt reduction agreement, results in a taxable benefit. To illustrate by example, a debt reduction agreement, which lowers debt by $20,000, will result in the debtor receiving a 1099 tax form from the creditor (which is also reported to the IRS by the creditor). In this example, the debtor would be required to report $20,000 of taxable income to the IRS.
Bankruptcy Cost
To evaluate the advantages or disadvantages of bankruptcy, the cost of that process should always be considered. In general:
- Bankruptcy court costs amount to a little less than $350.
- Attorney fees incurred in filing a Chapter 7 personal bankruptcy should amount to no more than $950.
- Attorney fees incurred in filing a Chapter 7 business bankruptcy should amount to no more than $2,000 to $3,000, depending upon the facts of each individual case.
- Attorney's fees incurred in filing a Chapter 13 personal bankruptcy are set by the bankruptcy trustee, with a required initial retainer of at least $100 to start a new case. The bankruptcy trustee pays all attorneys' fees that are allowed, from funds paid into the Chapter 13 plan.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
Filing Bankruptcy in Garland County?
Our law office advises people in four main areas:
- Chapter 7. This is the most common form of bankruptcy. Chapter 7 imposes an automatic stay barring creditors from contacting you about your debts. At the conclusion of your case, you receive a discharge of all your unsecured dischargeable debts.
- Garnishment and creditor harassment. Chapter 7 and Chapter 13 provide immediate relief from creditors who are garnishing your paycheck or bank accounts and creditors who are harassing you with repeated calls and letters.
- Tax debt resolution. A common problem for many people who are in debt is unpaid tax debt. This office works with clients to eliminate or reduce tax debt through bankruptcy or through negotiating directly with the IRS, a procedure identified as an offer in compromise.
- Chapter 13 and foreclosures. Chapter 13 provides those with regular income with an opportunity to stop foreclosures and repossessions and allows a debtor, with the help of the debtor's attorney, to develop a payment plan that will bring arrearages current over a period of three to five years.
If you have debt and/or tax problems, you are invited to call Hot Springs personal bankruptcy lawyer Steve Westerfield at 501-623-3922 or e-mail him for a free initial consultation.
Our office also offers services in Spanish. Esta oficina ofrece servicios en español.