Texas bankruptcy lawyers help individuals that intend to file for bankruptcy navigate the legal system by selecting an appropriate bankruptcy option, obtain appropriate credit counseling and emerge from bankruptcy after a repayment plan has been fulfilled. Depending on your location in Texas, your bankruptcy will be in the Texas Eastern, Western or Southern District Federal Court.
How do I discharge my debt?
The only way to discharge unsecured debts is to declare Chapter 7 bankruptcy. In Chapter 7 bankruptcy, a trustee is appointed to liquidate unsecured, non-exempt assets in order to repay creditors. Repayment is at the discretion of the trustee and the debtor has little say in the matter. The credit impact of bankruptcy will last for ten years. Most debts owed are discharged, except for child support, student loans, property and income taxes less than 3 years old, as well as financial penalties associated with law-breaking. Debts that can be discharged include medical bills, loans and credit card debt.
To get rid of secured debt, the only method would be to give up the collateral the debt is secured against. Secured debt usually means all property that can be foreclosed on or repossessed. Secured debts are not liquidated during bankruptcy and can be kept or surrendered, based on arrangements the owner makes with the debt holder. A Texas bankruptcy lawyer can help you determine what to do with secured debt and which of the other debts are unsecured.
What is an estate?
A person’s estate is the sum of all property owned by an individual. An individual’s estate is only imperiled in bankruptcy when the total assets exceed the amount owed, in which case the trustee will sell nonexempt assets to settle debts. Assets not included in the estate include property that is leased, rented or otherwise owned by another party that the individual makes payments to fro the right to use. The debtor may choose to allow this property to be repossessed by the owner at his or her choosing if the monthly payments constitute a financial burden.
What is an alternative to the liquidation of my assets?
Chapter 13 bankruptcy is a court supervised repayment plan that does not discharge debts. It does however give the debtor time to reorganize through an automatic stay and pay off debts while keeping all assets. The debtor has steady income stream that can be used in a repayment plan while also convincing the court that he or she will be able to abide by the terms of the repayment agreement. This debtor must be able to demonstrate sufficient need for bankruptcy protection yet the financial ability to pay off the debts eventually when given extra time and automatic stay. The Texas bankruptcy lawyer will help you determine if you can file for Chapter 13 and comply with the provisions of the repayment agreement. The repayment plan typically lasts 3 – 5 years.
What to prepare before meeting with the Texas bankruptcy lawyer
You must collect all bills as well as well as a listing of your assets and be prepared to show them to the attorney. You will need tax returns for the previous two years, and any other relevant personal finance documents. The Texas bankruptcy lawyer needs all of this information to determine your situation and the appropriate bankruptcy option. The Texas bankruptcy lawyer will also need to determine which of your property is exempt from seizure.
Be accurate in determining your current assets and do not try to conceal or overstate your assets. Accuracy is important in this process and fault or sloppiness on your part will close the case. Credit counseling is mandatory for all persons seeking bankruptcy protection and this will happen after you choose to file for bankruptcy.
What property is exempt from liquidation?
Texas state law exempts some of the following property from bankruptcy rulings:
– Personal property including
o Athletic and sporting equipment including bicycles, two firearms, family heirlooms, jewelry (not exceeding 25% of the total exemption)
o Two horses, mules or donkeys and a saddle for each
o 12 head of cattle or 60 head of other livestock
– One motor vehicle per member of the family with a driver’s license
– Unlimited homestead exemption not exceeding 1 acre in a municipality and 100 acres elsewhere. 200 acres for families.
– Burial plots
– Some tools, equipment and farming vehicles necessary to maintain a trade.
– Most insurance, veterans, social security, unemployment, worker’s compensation and spousal support benefits
– All public and civil service pensions
– Earned but unpaid wages
A Texas bankruptcy lawyer can assist you in determining which property is exempt under Texas law as well as potential loopholes that can spare some of your assets from seizure to pay credits. Texas law clearly provides exemptions for most to restart their lives with most of their property, especially professional and farming implements intact.
What are the advantages to bankruptcy?
Bankruptcy provides an automatic stay against creditors, which prevents them from taking action against the debtor, such as collection harassment, repossessing property and filing lawsuits. Automatic stay also ends garnishment of one’s wages to repay debts, which is allowed under Texas law. Bankruptcy allows the individual to overcome burdensome debt and improve their financial practices to avoid future trouble with finances.
Where to look for an attorney
The State Bar of Texas, which is a mandatory organization for Texas lawyers, maintains a low cost lawyer referral service. The Lawyer Referral Information Service will connect you to a lawyer in your area that will charge no more than $20 for an initial 30 minute consultation. You will be able to find Texas bankruptcy lawyers that will be able to help you file for the appropriate chapter of bankruptcy and guide you through the process.
You may use this website to find an attorney. To do so, use the search box on top of all pages. You may also compare attorneys and ask free questions by clicking Find Attorneys on top of the page.
Rates, Fees & Retainers
The fees to file for bankruptcy in Texas were increased on November 1, 2011 and are currently at $281 for Chapter 13 and $306 for Chapter 7. This is in addition to lawyer fees. Fee cans be waived or paid in installments at the discretion of the court.
Hourly rates may be accrued from using the lawyer or support staff such as paralegals. This is a simple arrangement and you should have a general idea of the amount that will be billed. This may not include flat legal service fees such as document preparation and filing. It is especially important to be aware of those fees.
A retainer fee is a non-refundable advance payment by the client that covers the cost of services provided by the lawyer. This payment is put into an account and billed whenever the lawyer performs services. This account may need to be refilled as the case continues. Although bankruptcy cases are not typically lengthy, retainer agreements can still be expensive, depending on the frequency by which the lawyer’s services are used.
You may choose to file for bankruptcy “pro se,” or without the assistance of a Texas bankruptcy lawyer. This is not advisable as you will risk losing non-exempt property or may make critical errors that will affect the outcome of your case.
Free services may be available to low-income families as well as no-cost consultations. Payment plans can be arranged between clients and lawyers in case there is significant financial hardship for the client.
Interviewing your attorney
The following questions are important when interviewing your attorney:
What fees do I pay for retaining services?
Can I have that in writing?
What are my options?
Can I file for Chapter 13 bankruptcy and preserve my assets?
Can I contact you directly if there is a problem?
Can you allow me to examine your credentials?
What is your experience with bankruptcies, specifically my circumstances?
If you cannot handle my case, can you refer me to a lawyer that can?
Although you can file for bankruptcy pro se, this is not advisable. A bankruptcy lawyer in Texas has a better knowledge of the process that you will go through during your bankruptcy proceedings, including mandatory credit counseling. In addition, every state will have unique laws defining allowable exemptions during bankruptcy judgments. The bankruptcy lawyer in Texas will be able to help you assess your property for exemptions as well as determine if you must part with certain items that have been used to secure debt. Some experienced bankruptcy lawyers Texas will even be able to help you determine the fair market value of your property, simplifying the process for you. You lose the benefit of a consummate professional and advocate when you choose to file for bankruptcy per se and leave yourself at the mercy of creditors who may or may not pay attention to exemption laws.