In Georgia, bankruptcy provides protection for consumers and businesses. The claims enforce provisions against certain legal action and loss of assets. They help consumers pay off outstanding balances and delinquent accounts. The following are frequently asked questions about Chapter 7/13 Bankruptcy in Marietta GA.
Does Bankruptcy Prevent Legal Action by Creditors?
An automatic stay is applied in both chapter 7 and 13 bankruptcy. It prevents creditors from filing a lawsuit and applying additional liens against assets. The duration of the automatic stay for chapter 13 lasts no more than five years. The duration in which it applies in chapter 7 is no more than six months.
Are All Debts Settled in the Claim?
No, all debts aren’t settled completely through a bankruptcy claim. The court discharges some debts completely. They include credit cards and unsecured debts. However, federal bankruptcy laws prohibit the court from discharging any government-based debts. They include small business or student loans. Any balance left over after the claim is discharged becomes the consumer’s responsibility.
Are Consumers Allowed to Keep Their Home?
Yes, under the homestead exemption, the consumer keeps their home and continues to live there. The exempted value for their home involves the equity they’ve paid into the property. A higher value owed for the property provides a higher exemption. This value helps the consumer retain ownership of the property by offsetting any overdue late fees and payments. At the end of the claim, their mortgage is no longer delinquent.
How is the Bankruptcy Type Chosen?
Georgia consumers qualify for bankruptcy based on income restrictions. All chapter 13 claimants need an income that exceeds the county median. This average for Cobb County is $65,180. If the claimant doesn’t qualify, they have access to chapter 7 only.
Consumers choose a chapter based on the benefits and their choices for the future. A consumer who is willing to give up their home finds solutions through chapter 7. Additionally, consumers with excessive undischarged debts such as alimony or child support offset these debts through liquidation.
In Georgia, the selection between bankruptcy chapters defines all restrictions and prerequisites. Some choices don’t protect assets fully. Their choice defines what properties are retained in the claim.
