Chapter 7 Bankruptcy

As a nation that puts a premium on risk taking and free enterprise, it is not surprising that we also have laws protecting those who find themselves with more debt than they can handle. Although not a “get out of jail free” situation by any means, filing for bankruptcy can allow you to settle your outstanding debts while having the opportunity to move on with your life and learn from your mistakes.

Chapter 7, known as the “liquidation” chapter of the Bankruptcy Code, is the most common form of bankruptcy protection in Ohio and Kentucky, along with the rest of the United States. Many individuals and businesses have filed for Chapter 7 bankruptcy since its inception. This type of legal financial protection was started as a way to look after the interests of consumers, business owners, and creditors while making a safer environment for lending.

A bankruptcy attorney can work with those looking for debt solutions and will be able to advise individuals and businesses on whether or not Chapter 7 bankruptcy is the right choice for their particular situation. The bankruptcy attorney’s goal is to help the debtor make a fresh start while ensuring that creditors are paid.

Greater Cincinnati and Northern Kentucky Chapter 7 Bankruptcy Attorney

Considering the importance of keeping your finances in order, having the right attorney representing and counseling you through the bankruptcy process is of the utmost importance. Eric Steiden is an experienced Ohio and Kentucky bankruptcy lawyer who has helped many people in both states accomplish overcome severe debt for the past 30 years. Since its inception, Steiden Law Offices has successfully represented over 6,000 bankruptcy cases, all while developing a strong reputation with the courts.

Eric Steiden and attorneys are committed to providing excellent client service and transparency, making them a valuable resource during this rocky time in your life. This translates into satisfied clients who are not led down an unnecessary path. Eric Steiden understands that this is a tough time and efficient, time-sensitive approaches are paramount.

With locations in Cincinnati, Florence and Covington, Steiden Law Offices is a convenient option for both Kentucky and Ohio residents searching for solutions to their financial problems. They have represented many individuals, families and businesses, and can be counted on to provide a quick and effective response to your debt issues.

To schedule a free consultation to go over your financial situation with Steiden Law Offices and see if you qualify for Chapter 7 bankruptcy, call (888) 877-3328 or send an online message. Eric Steiden proudly represents individuals throughout southern Ohio and northern Kentucky, including Hamilton County, Boone County and Kenton County.

Chapter 7 Bankruptcy Information Center

• Chapter7 Bankruptcy Basics
• Eligibility to File for Chapter 7
• Secured vs. Unsecured Debt
• Chapter 7 Bankruptcy Legal Resources

Chapter7 Bankruptcy Basics

Chapter 7, as mentioned above, is considered the “liquidation” form of bankruptcy, and can be found in Title 11 of the United States Bankruptcy Code (§701 – §784). This liquidation of assets is different from Chapter 11 and 13 bankruptcies, which have a primary goal of debtor reorganization. Both individuals and businesses can file Chapter 7.

A Chapter 7 bankruptcy case begins when the debtor files a petition with the bankruptcy court serving the area where he or she lives. In the case of business bankruptcy, it would be filed where the business debtor is organized or has its principal place of business or principal assets. In addition to the petition, the debtor must also file with the court:

• Schedules of assets and liabilities;
• A schedule of current income and expenditures;
• A statement of financial affairs; and
• A schedule of executory contracts and unexpired leases.

Individuals

Individuals who reside, have a place of business, or own property can file for Chapter 7 bankruptcy in a federal court. In this bankruptcy chapter, an individual is allowed to keep certain exempt property. The total value of the property claimed will be different in both Ohio and Kentucky. Other assets are sold by the bankruptcy trustee to repay the relevant creditors. If there is little or no property left over in the debtor’s estate after the debtor keeps his or her exempt property, this is known as a “no-asset case.” In this very common scenario, there is no actual liquidation of the debtor’s assets and creditors are not paid anything.

A Chapter 7 bankruptcy in Cincinnati or Northern Kentucky stays on an individual’s credit report for 10 years from the date of filing the Chapter 7 petition.

Businesses

When a struggling business has reached unsustainable debt and is unable to service the debt or pay off the creditors, a Chapter 7 bankruptcy filing may be the best option to pursue. A Chapter 7 filing means that the business ceases operations unless continued by the trustee. Furthermore, the trustee is an important aspect of this process, because they are given broad power to examine the business’s financial affairs. This trustee will be tasked with selling assets and distributing the proceeds to the creditors.

Eligibility to File for Chapter 7

According to the Bankruptcy Code, an individual, partnership, corporation or other business entity is eligible to file for bankruptcy under Chapter 7.

A person’s eligibility to file is determined by the “Means Test.” This test calculates your income as compared to the average family of the same size in your state. If your income falls below the median income for your family size, there is no “presumption of abuse” and you can usually file for Chapter 7. If you are higher than the median, you may still be eligible, but many other factors need to be taken into account. This can make the calculation a bit more complicated and you may have to file for Chapter 13 instead.

As for median income, In Ohio:

• A single earner’s median income is $41,748;
• A two-person household’s income is $51,839;
• A three-person household is estimated at $60,219; and
• A four-person household’s median is currently $72,827.

Kentucky, on the other hand, has a median income for:

• A single earner currently at $39,567;
• A two-person household at $46,107;
• A three-person at $53,496; and
• A four-person household at $64,558.

For both states, “family size” has a specific legal definition, so working with a bankruptcy attorney will give you the exact number for your particular situation.

The means test does not apply for disabled veterans, members of Armed Forces Reserves or National Guard who were on active duty, and for those whose debts incurred were over 50% business related (not consumer debt).

A person is not eligible to file for Chapter 7 if:

• He or she had been a debtor in a bankruptcy case pending at any time in the preceding 180 days;
• The case was dismissed by the court for willful failure of the debtor to abide by orders of the court, or to appear before the court in prosecution of the case; or
• The debtor voluntarily dismissed the bankruptcy proceeding following a request by a creditor for relief from the automatic stay.

Secured vs. Unsecured Debt

In a Chapter 7 bankruptcy filing, the difference between secured and unsecured debts is important to keep in mind. A secured creditor retains an interest (called a “lien” or “security interest”) in certain property, which is termed, “collateral.” In most cases, the creditor has extended credit to the debtor specifically for the purchase of the particular property.

The most common example of this process is an auto loan. Another example is a mortgage in real property, whether it is done for a purchase, refinancing or a home equity loan. If the borrower is not able to make the requisite payments, the collateral can be repossessed (auto loan) or foreclosed on (real property).

Unsecured debts, on the contrary, lack any collateral attached to the debt itself. The most familiar types of unsecured debts are credit cards, personal loans, and debts for services performed (i.e. medical bills). Generally, these types of debts are discharged in a Chapter 7 bankruptcy in Kentucky and Ohio.

In a Chapter 7 filing, secured creditors normally preserve their liens in the debtor’s property, and the debtor will carry on making regular payments to the secured creditor. It must be noted that the debtor’s personal obligation to pay the debt is discharged in the bankruptcy proceeding, unless a reaffirmation agreement is filed with the court. If a reaffirmation agreement is not filed, and the debtor consequently fails to make the payments, the creditor’s only real option is to repossess or foreclose on the property. This means that the creditor cannot sue the debtor for failure to pay the debt.

Chapter 7 Bankruptcy Legal Resources

United States Bankruptcy Code – Chapter 7 – This is the primary website for information on Chapter 7 Bankruptcy under the U.S. Bankruptcy Code. The link provides information on the filing process, background of law, alternatives to Chapter 7, roles of the case trustee and the Chapter 7 discharge.

Legal Information Institute – This website was developed by the Cornell University Law School and is a great resource on researching and reading the laws that govern our nation. It includes information on federal law, the constitution, state law resources, state statutes, bankruptcy and much more.

United States Bankruptcy Court – Southern Ohio – The primary website for Cincinnati and surrounding area residents. It provides information on judges, locations, phone numbers, FAQ s, means testing, filing and seminars.

U. S. Bankruptcy Court – Eastern Kentucky – This is the main page for the Eastern District of Kentucky Bankruptcy Court. It offers information on new standing orders, locations, mission statements, judges, processes, opinions and frequently asked questions

Steiden Law Offices | Cincinnati Chapter 7 Bankruptcy Lawyer

Considering the stress that an individual or business is under when even considering this option, it is important that you take the correct steps in resolving this legal financial issue by working with a qualified Chapter 7 bankruptcy attorney in Covington, Cincinnati, Florence, or your immediate area who can guide you through this difficult and complex process. Although a great deal of effort will be necessary to get back to top form again, bankruptcy can save you from a fate that could paralyze your ability to handle your finances.

Hiring an experienced attorney will allow you to redirect your focus towards what important in life, rather than having to deal with a legal situation that almost no one is truly prepared to undertake. An Ohio or Northern Kentucky bankruptcy attorney will make all the necessary filings while ensuring that every relevant factor is taken into account when developing your case.

Eric Steiden is a Midwestern bankruptcy lawyer who has spent well over a decade helping individuals and businesses throughout Kentucky and Ohio get out under the burden of debt so they can move past this dark moment and get on with their life. Eric and attorneys will draw from this experience, along with their extensive knowledge of bankruptcy law, to provide excellent representation throughout the entire process. The firm has four office locations: two in Cincinnati, OH, and one each in Florence and Covington, KY.

To schedule a free consultation in order to go over the specifics of your legal financial issues and see if you are eligible to file Chapter 7 bankruptcy, call (888) 877-3328 or send an online message today. Steiden Law Offices proudly represents individuals throughout both states, including the cities of Norwood, Forest Park, Blue Ash, Montgomery and Reading in Ohio and Covington, Erlanger, Edgewood, Elsmere, Villa Hills and Fort Mitchell in Kentucky.