When you are ready to declare bankruptcy in Illinois, it will be beneficial to you to understand the basics first. It is also important that you find a lawyer that has plenty of experience in bankruptcy laws as the subject can be complicated and you will have more of a chance to keep most of your property. You should also keep in mind that a recent law, the Bankruptcy Abuse Prevention and Consumer Protection Act, requires you to meet with a credit counselor and be engaged in a debt relief program with them for at least six months before declaring bankruptcy. It also makes the process much more difficult.
If you decide to file for bankruptcy in Illinois under Chapter 7, then you will be subject to the means test that determines your income. If your income is under the annual median amount, then you won’t be eligible for Chapter 7 and must file for Chapter 13. You may, however, file under Chapter 7 if your income is below the annual median for the state. The median annual income for a single person in Illinois is $44,673 and $56,545 for a family of two. Also keep in mind that you will have to file any overdue tax returns before declaring bankruptcy as well.
|If you need legal assistance with a bankruptcy issue, please consult with a Bankruptcy Lawyer in your area to discuss the details of your case.|
The exemptions when you declare Chapter 7 are different for every state, so it is important that you understand the exemptions for Illinois thoroughly. Here are the major exemptions when declaring bankruptcy in Illinois: benefits such as disability, worker’s compensation, unemployment, and social security; retirement plans and insurance proceeds, clothing, school books, family photos, health aids, tools of your trade, alimony, child support, and so forth. Make sure you ask your attorney to help you declare as many of your possessions as possible. If you have less than $7,500 equity in your home then you may keep your home as long as you keep your payments. Similarly, you may keep your vehicle if you have $1,200 equity and continue payments.
Chapter 13 is different than Chapter 7 as it won’t wipe away all of your debt; instead, it will help you to work with your creditors so that you can lower your payments and have your debt paid off within three to five years. This is a great opportunity for those of you worried about losing your home to foreclosure.
|The content of this article is provided for informational purposes only. If you need legal assistance with a bankruptcy issue, please consult with a Bankruptcy Lawyer in your area to discuss the details of your case.|