2435 Plantation Center Dr Ste 205, Matthews, NC 28105 | jdalrymple@matthewsattorneys.com
 
Call us Today:
704-847-7151
 
 
 
 
 
 

Bankruptcy

 
Although a Chapter 7 is often referred to as a "Liquidation" bankruptcy, the reality is that very few people actually have any of their property liquidated (taken). Legislative history tells us that Chapter 7 is supposed to provide the "honest but unfortunate debtor" a "fresh start". It wouldn't be much of a fresh start if every last piece of property was taken from you. Accordingly, when you file bankruptcy, exemption (protection) laws allow most people to claim as "exempt" all of their property. No, you do not automatically lose your house or car if you file Chapter 7. It all depends on "equity". {Equity is the difference between what your property is worth, and what you owe against it}. Although there are other less used exemptions, the primary exemptions used by North Carolina residents are up to (1) $35,000 of equity in their primary residence {per Deeded owner}, (2) $3,500 of equity in one automobile per person, (3) $5,000 per person of equity in the current fair market value of all of your household goods and furnishings, (4) any reasonable amount of wages that you have earned in the past 60 days (if you have dependents), (5) $2,000 tools of the trade,
 
Businessman Showing Empty Pocket — Bankruptcy Lawyer in Matthews, NC
 
(6) IRA's and most retirement plans, and (7) if you do not need to use the last $5,000 of the $35,000 residential exemption (ie... you have less than $30,000 of equity in your house), then that last $5,000 becomes a "wildcard" that you can use to protect any other property that you own that didn't fit into one of the other exemptions. People typically use the "wildcard" exemption to protect pending tax returns, excess (above $3,500) car equity, savings accounts, or other money that was not earned in the past 60 days.
Obviously, every case is different, and exemption availability and exemption planning should be immediately discussed with attorney Dalrymple if you are even considering a potential bankruptcy case, and most certainly before you make any kind of transfer of any property you currently own as most transfers in the years leading up to bankruptcy can be voided and undone by a bankruptcy trustee.
 
Chapter 13: Although there are other reasons to file Chapter 13, most cases are filed for one of two primary reasons; either (1) to stop a pending foreclosure against your residence, or (2) if someone has too much income to qualify for the total relief of a Chapter 7 their only bankruptcy option is a Chapter 13 repayment plan where they must commit their disposable income over the next 60 months to pay back at least some of their unsecured debt.

But by far, most 13 cases that are filed is to stop an impending foreclosure sale. The filing of a Chapter 13 case stays (kills) the pending foreclosure case (if your property is in NC, then we can void the sale even up to 10 days after the sale has already taken place) and allows you to propose a repayment plan where you can catch up your mortgage arrears over as much as 60 months so that you can keep your house. The actual monthly payment required in any given case of course depends on the amount of (1) your normal monthly mortgage payment(s), (2) the amount you are behind on the mortgage(s), (3) how much money you have available from your wages or earnings each month and is it enough to not only pay the mortgage and arrears but also some amount to unsecured creditors, (4) how much unsecured debt or non-dischargeable tax debt you may have, and (5) the amount of NON-exempt equity you may have.
 
If you think you may need to file Chapter 13, please call attorney Dalrymple to discuss the payment amount that might be needed in your situation.