Bankruptcy is about money on paper, but really it’s about getting more than money back. Being free from enormous debt can really lift a weight off your shoulders. After all, who likes a $50,000 medical bill coming in the mail, when you don’t even make that much in a year? Or what happens when your husband or wife loses their job, the housing market falls, and you have to pay the mortgage on your own?
There are many scenarios where filing bankruptcy is best for you and your family. This guide gives you 4 benefits of filing for protection by using Chapter 7 or Chapter 13 bankruptcy.
You Can Have a Job
The Texas income levels do matter in Chapter 7 bankruptcy, but you are often well within the annual income levels. The means test looks at the past six months: how much you made, and how much a family of your size made on average in Texas. If you are below, you can file Chapter 7. If you are over, you might be able to wait until your income lowers, or you can file Chapter 13. If you just lost a job, it may take a few months wait before your income is low enough.
What are the income limits in Texas? For one person, the limit is $38,801. For a family of two, $55,660; three is $59,011; four is $66,145; and if you have a larger family, the income limits continue to grow. So you can often have a job and still file.
Bankruptcy Protects Your Home
Chapter 13 bankruptcy best protects your home, but in Texas, the homestead exemption in filing bankruptcy has no limit. You can only have so much personal property, but the exemption can protect your home. If you fear a foreclosure is coming, by filing for bankruptcy you buy yourself time to catch up; a judge will put an automatic stay which in effect stops all collections for several months. This can give you some legal protection. The important thing is to file before foreclosure is begun.
It Protects Your Assets and Car
You can have personal property up to $30,000. You can also work out a fair rate on your car. Even though technically you can lose a car in Chapter 7 bankruptcy, most lose nothing when they file. For families with only one car, keeping it is very important. You can pay on it outside the bankruptcy or pay installments within the bankruptcy. This depends on how much you owe on the car.
Texas Bankruptcy Can Save You Tens of Thousands
For families, perhaps the biggest fear is a son or daughter getting hurt in a car accident or to simply come down with a major illness. What is sometimes forgotten in the moment is the costs involved if you have no insurance. For families nationwide, having no medical coverage is a reality. But there is good news: Chapter 7 bankruptcy can discharge the entire debt. You can also use it to discharge family credit debt.
Creditor Harassment
While the phone can be a bearer of good news, it can also be one of bad news. You owe this much money. You get a call every day or every other day on it. Then a new creditor starts calling. Then you get even more calls off shut off notices and threats. This can be stopped outside bankruptcy, but by filing you are ensuring creditor harassment will stop. Creditors have no more reason to call you. And if they do, refer them to your lawyer.
