Bankruptcy is a powerful tool for discharging debts and getting a fresh start if you are unable to pay your bills. When you declare bankruptcy, you are immediately protected from creditors. Collection calls must stop, and creditors are temporarily barred from repossessing your car or foreclosing on your home.
Bankruptcy Basics
- Chapter 7 bankruptcy can work in one of two ways. It depends on whether you have exempt or nonexempt assets. Oklahoma has a standardized list of exempt property that is protected from liquidation. Clothing, furniture and books are always exempt. Your home equity and a portion of your car’s value is protected. If you have luxury goods and valuable assets that exceed the exemption limit, they can be liquidated to repay your creditors. You must earn less than the median income or have substantial expenses to qualify.
- Chapter 13 is an adjustment bankruptcy in which the amount you owe is reduced according to your income, expenses and ability to pay. The repayment schedule is usually completed in three years. It’s easier to qualify for Chapter 13 bankruptcy than Chapter 7. It offers several advantages, such as the ability to keep your home and to make catch-up payments on secured loans that wouldn’t be discharged through Chapter 7.
- Chapter 11 bankruptcy is an option for businesses and individuals whose debt exceeds the limits offered by Chapter 13. It’s a reorganization bankruptcy that requires you to pay back your debt. The restructuring plan must be approved by your primary creditors. The process is more complex and takes more time, which is why other filing options are preferred.
Taking the Next Step
If you’re considering bankruptcy, please browse through the resources on the site. You’re also welcome to call the office at 405-216-0007. I can answer your questions and arrange a free consultation to help you weigh your options and make informed decisions about your financial future.
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