What To Discuss With A Bankruptcy Law Firm In Honolulu, HI

by | Jul 30, 2019 | Lawyer

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In Hawaii, bankruptcy assists consumers who are facing excessive debt. The claims offer an automatic stay that protects consumers from legal action. The stay lasts throughout the full duration of the case. For chapter 13, the stay lasts between three and five years, and in chapter 7, it lasts up to six months. A Bankruptcy Law Firm in Honolulu HI assists consumers who need to manage their debts quickly.

Eligibility Requirements for Bankruptcy

To qualify for bankruptcy, claimants provide six months of income statements. For chapter 13, their income must exceed the median for their household. For chapter 7, the claimant provides a detailed list of all their assets, and a trustee obtains appraisals. If the assets have an appraisal value that exceeds their debt balance, the claimant qualifies.

How Each Chapter Works

Chapter 13 requires the claimant to start a new repayment plan approved by the court. The consumer pays monthly payments according to guidelines of the plan. On the other hand, chapter 7 is the liquidation process in which the assets are sold to pay off the debts. A trustee manages the sales and distributes the funds to the creditors.

Protection for Assets

Exemptions are used in bankruptcy to protect certain assets. For example, the homestead exemption protects the consumer’s primary home. Automobiles for which they haven’t built up a lot of equity are protected through an exemption, too. However, the consumer doesn’t have protection for vacation homes, timeshares, or their automobile collection.

Stipulations for Bankruptcy

In chapter 13 bankruptcy, the claimant isn’t allowed to open new lines of credit. All disposable income is used to pay any debts that weren’t included in the claim. Any violation of the terms leads to a discharge of the bankruptcy, and the consumer becomes immediately responsible for all debts.

In Hawaii, bankruptcy offers assistance with overwhelming debt and an opportunity to become debt-free. Eligibility for the chapter defines what options are available to the consumer. Claimants who want to discuss their case with a Bankruptcy Law Firm in Honolulu HI contact Goodsill Anderson Quinn & Stifel or visit the website for additional details now.