In the state of Maryland, consumers have the opportunity to file for bankruptcy based on the provisions of the 2005 Bankruptcy Act. This debt-relief solution could provide them with an extended repayment plan under Chapter 13. Alternately, they could file a claim through Chapter 7 to liquidate their assets. By reviewing these options, the consumer determines which option is the most beneficial choice.
Chapter 13 Claims
To file a claim through Chapter 13, the consumer must have an income, which is above the median income for their area. Currently, the median income for a single individual in Annapolis is $43,153 annually. However, the bankruptcy court establishes eligibility based on their income and household size. To make these distinctions, contact a Law Firm in Annapolis MD.
Through Chapter 13, a repayment plan is designed to allow them to repay their debts over a three-to-five-year period. The consumer is required to submit monthly payments through the court. In some cases, they can make arrangements for the payment to be garnished from their wages.
Additionally, they are required to use all expendable income to pay off any debts that weren’t included in the case. This value is determined after all monthly obligations are deducted. These obligations include household expenses and any loans.
Chapter 7 Claims
Through Chapter 7, the consumer surrenders the deeds and titles to their properties to the court. A trustee is assigned to sell and distribute all funds generated. The consumer receives exemptions for the properties based on the values assigned to these properties by the state of Maryland. This process takes up to six months to complete.
What You Should Know
Before you can file a claim, you are required by federal law to enrol into a credit-counseling program. This program must be approved by the state of Maryland. After you complete your bankruptcy case, you are required to undergo financial management courses.
Consumers who file for bankruptcy have the potential to become completely debt-free. However, the bankruptcy will appear on their credit report for up to ten years. If you wish to learn more about bankruptcy, you should contact your preferred Law Firm in Annapolis MD today. You can visit website domain or their Facebook page for more information.
