Full Discarge Bankruptcy, Chapter 7

Chapter 7 bankruptcy is very common––much more common than people know. That said, there are a few caveats to keep in mind. First, not all debts are eligible for bankruptcy. Second, not all individuals, partnerships, or corporations will qualify. These caveats are reasons why you should consult with a bankruptcy lawyer to make sure Chapter 7 is right for you.

Qualifying for Chapter 7 bankruptcy typically means being able to pass what is known as the Means Test. The Means Test determines whether you can pay off your debts. To pass the Means Test, your income must not exceed the income limits set by your state.

State income limits vary because the cost of living differs from state to state. Your state's income limit depends on the number of earners and people in the household.

For example, in Wyoming, the income limit in all cases filed after May 15, 2023, for

• One earner is $65,457

• Two people is $82,531

• Three people is $93,651

• Four people is $104,487

• Each person in excess of four is an additional $9,900
  

Any person or company can file bankruptcy under Chapter 7 if they

• Own property in the United States

• Have a permanent residence in the United States

• Have not filed bankruptcy under Chapter 7 within the last eight years

• Completed credit counseling from an approved credit counseling agency

• Satisfy eligibility criteria
  

Even though you can file for Chapter 7 bankruptcy, it does not mean you should. You should consider Chapter 7 bankruptcy if

• You want a fresh start

• Your credit score is already below 600

• You want a reasonably fast process to discharge debts

• You have a lot of debt and are either close to or meet the homestead exemption amount of equity in your home (this is the amount protected against bankruptcy)

• You have a lot of debt, but you also have income or assets creditors can take

• You cannot keep up with making ends meet at the end of the month

• You will not be able to pay off your debt within five years

• No other debt relief option applies or would provide better protection and benefits

• You do not want a debt repayment plan
  

On the other hand, you may not want to file for bankruptcy in Wyoming if

• You are not presently working

• You have no assets a creditor can garnish

• You receive protected income, like
  Aged, Blind, or Disabled (ABD) benefits Child support Federal student loan proceeds Retirement pensions Social Security Supplemental Security Income (SSI)Temporary Assistance for Needy Families (TANF)Unemployment benefits

• You have too much equity in secured property (e.g., a car) that the creditor can repossess but you want to keep

• You are not close to the homestead exemption amount of equity in your home

• You do not want to hurt your credit score

• You can pay off your debts within the next five years

• Other debt management solutions are available and may be more beneficial

Speaking to a Chapter 7 bankruptcy attorney can provide you the insight you need to make informed decisions about how to address your debt.

The cost to file Chapter 7 bankruptcy in Wyoming depends on whether you file on your own or retain a bankruptcy attorney. Filing fees must be paid, and they are mandated by the U.S. Bankruptcy Court. The total filing fees for Chapter 7 will include

• Filing fee

• Administrative fee

• Trustee surcharge

These fees are subject to change periodically. For Chapter 7, the court fee is $338. There may also be some administrative costs.

Retaining legal representation adds to the cost. To ease the burden I take payments up to the date of filing.

There are quite a few documents you need when you file for Chapter 7 bankruptcy in Wyoming. Here's a list of some of the most common and necessary documents you will need.

• Creditors, including a copy of the most recent statement or underlying document for each creditor

• Cosigners, including their names and addresses
  

• Current paycheck stub and/or evidence of income received within the last six months
  

• Tax returns for the last four years
  

• Divorce decrees and/or domestic court orders related to debt and/or support obligations
  

• Insurance policies for all insured assets (e.g., residential homes and automobiles)
  

• Certificates of title to all titled assets (e.g., vehicles, boats, recreational vehicles, campers, trailers, motorcycles, all-terrain vehicles)
  

• Deeds to real estate, including cemetery plots
  

• Recorded mortgages
  

• Appraisals on any real estate over the last four years
  

• Lawsuits, judgments, or liens, including tax liens
  

• Credit reports from Equifax, Experian, and TransUnion
  

• Bank account statements covering the last 12 months
  

After you file for bankruptcy, three important and immediate things happen:

1. You are given a case number; 

2. An automatic stay takes effect, which means creditors can no longer garnish wages or take collection action against you; and

3. A bankruptcy trustee is assigned to your case––the trustee reviews all documents, verifies information, and oversees the meeting of creditors.

Once Chapter 7 bankruptcy is granted, you will see your credit score affected by it. Chapter 7 bankruptcy stays on your credit report for ten years. As you rebuild your credit, bankruptcy will begin to lose its negative effect on your credit score.

At Hampton Young Law, we know how debt can impact an individual, a family, or a business. If you have difficulty paying bills because of the debt you or your company have accumulated, speak to a Wyoming bankruptcy attorney today by filling out my online form or calling me at 307-797-2486, or email me at legalgeek@outlook.com. I will talk to you immediately or schedule a Free 15-minute consultation so that you get the answers you need to all your financial questions.