Montgomery County Bankruptcy Lawyers
You do not have to struggle with an unmanageable debt level for an unlimited amount of time. There are instances in which you may benefit from protection under federal bankruptcy law. This protection does not come without a price, but it may be one that you need to pay to get a fresh financial start in life. You should at least consider whether bankruptcy is the right option for you. Do so with the help of an experienced Montgomery County bankruptcy lawyer who can give you legal advice after reviewing your situation.
Why Should I Consider Bankruptcy for My Situation?
Regardless of how you found yourself in financial distress, there may come a point in time when you need the relief that the bankruptcy process provides. Whether to file for bankruptcy is a personal choice, but you should consider the financial realities of your situation in making this decision. You should know that the bankruptcy process can provide you with a fresh financial start in life, albeit after you must make some sacrifices.
Nonetheless, filing for bankruptcy can eventually make your situation much easier. The calls from your creditors will stop, and you could emerge from the process free of the debt that has trapped you for so long.
How Does the Bankruptcy Process Work?
When you file for bankruptcy, there is a trade-off involved. Namely, your unsecured debts can be wiped clean, but you need to surrender certain personal property to achieve that outcome. If your personal property is not subject to an exemption, you must surrender it to the bankruptcy trustee, who would then sell it and use the proceeds to pay your creditors.
One of the most important elements of the bankruptcy process is the “automatic stay.” As soon as you file your bankruptcy petition, your creditors’ calls and efforts to collect on your debts must stop. Your creditors could end up in serious trouble if they violate the automatic stay. All told, the exact amount of time that it would take for you to go through the bankruptcy process depends both on the complexity of your case and the completeness and accuracy of your paperwork. It is not an unrealistic expectation for you to emerge from bankruptcy within six months after you file the petition at the latest.
Which Debts Are Cleared in Bankruptcy and Which Are Not?
Not every debt that you owe qualifies for “discharge” in bankruptcy. Typically, it is your unsecured debts that you can get relief from when you file for bankruptcy. Debts that may be subject to discharge in bankruptcy include:
- Credit card bills, so long as you did not make large purchases in close proximity to the point when you file for bankruptcy
- Medical bills
- Personal loans
- Personal judgments against you
- Remaining payments under a lease or contract that you broke
Bankruptcy courts apply principles of equity to your case. They may look at obligations that you incurred close to the time when you filed for bankruptcy, and they could disallow the discharge of these debts.
There are certain debts that are “not subject to discharge” in the bankruptcy process. This category of debts may include the following:
- Secured debts, such as mortgages and car loans
- Child support obligations and alimony
- Student loans, under most circumstances
- Recently incurred tax debts
- Fines and penalties that you owe to government agencies
A bankruptcy lawyer can review your situation before you file to let you know which debts you may have discharged in the process. They can advise you based on your situation if filing for bankruptcy is the right option for you.
What Property Must I Surrender in the Bankruptcy Process?
According to the law, “all property that is not exempt must be surrendered to the bankruptcy trustee for them to sell and pay your creditors.” Maryland law provides for several exemptions that can allow you to retain some of your property, so long as you have lived in the state for two years or more before filing for bankruptcy. You may take advantage of the following exemptions in the bankruptcy process in Maryland:
- You may exempt up to about $25,150 in equity in your owner-occupied residence.
- Maryland allows a “wildcard” exemption: Up to $6,000 in cash or any kind of personal property.
- There is a $5,000 exemption for tools of your trade.
- Unearned wages (child support, alimony) are protected.
There are certain things that cannot be touched in the bankruptcy process. For example, if you have money in a retirement account that is not subject to surrender during bankruptcy. In addition, your pension is also protected from bankruptcy.
What Are the Steps in the Bankruptcy Process?
The bankruptcy process consists of many steps from start to finish. You need to successfully complete all of them for you to successfully emerge with a fresh financial start. Here are the required steps in the bankruptcy process:
- Make a decision about whether bankruptcy is the right option for you
- Under Maryland law, you need to complete a credit counseling course prior to filing for bankruptcy and present the certificate as part of your petition
- Draft the bankruptcy petition and the supporting documentation to file with the court
- Attend a creditor’s meeting led by the trustee who is appointed by the bankruptcy court to administer your case
- Surrender certain property as required by law
- Complete a second mandatory course, which covers debtor education
- Receive a discharge of your debt at the conclusion of the bankruptcy process
While you do need to participate in the bankruptcy process as the debtor, you can hire an experienced lawyer to handle all of the details for you.
Do I Need a Lawyer to File for Bankruptcy?
There is no legal requirement in the bankruptcy laws that you are represented by counsel in all proceedings. However, in practicality, hiring a bankruptcy lawyer is a must for your case. Bankruptcy is a legal process that is subject to technical requirements that you must follow to have the best chances of success. Further, there are representations that are being made to a court in your name. If there are intentional mistakes on the paperwork or if you are found to have deliberately hidden information, not only will your bankruptcy be unsuccessful, but you could also face fraud charges.
Hiring a bankruptcy lawyer cannot only increase the chances that you are able to successfully emerge from the process with a fresh start, but it can also help you protect yourself. You are already going through a stressful enough period without having to worry about a legal process.
Contact the Montgomery County Bankruptcy Lawyers at LeViness, Tolzman & Hamilton if You Are Considering Filing for Bankruptcy
If you are struggling with debt and do not know how you will be able to manage your situation, speak to the Montgomery County bankruptcy lawyers at LeViness, Tolzman & Hamilton. We can help determine whether bankruptcy is the proper course of action for you. Then, we can represent you throughout the process. To schedule a free consultation, fill out our online contact form or call us today at 800-547-4LAW (4529). With office locations in Baltimore and Owings Mills, Maryland, we proudly serve clients throughout Maryland.