You can’t afford to pay all of your bills, and you are contemplating bankruptcy, you need to be aware of how these benefits are treated in bankruptcy if you receive Social Security benefits (SS), or Social Security Disability Insurance benefits (SSDI. But whether it is in your best interest before we discuss how these benefits are treated you should consider whether bankruptcy is even necessary in your situation, or. Before you determine if bankruptcy is right for you, it is necessary which you realize the various bankruptcy choices.

There’s two bankruptcies that are common customers, Chapter 7 and Chapter 13 http://www.badcreditloanshelp.net/. A Chapter 7 bankruptcy is frequently known as a “Fresh Start” bankruptcy as it discharges (wipes out) many forms of personal debt within about 3 months of filing bankruptcy (there are numerous exceptions to discharge, including many fees, alimony/maintenance, son or daughter help, student education loans, and many federal government debts and fines). A lot of people whose only revenue stream is SS and SSDI advantages, effortlessly be eligible for a Chapter 7 bankruptcy. Luckily, this will be usually the cheapest, quickest, easiest associated with the two bankruptcy choices.

A Chapter 13 bankruptcy is oftentimes known as a “Wage Earner” bankruptcy. A Chapter 13 is normally a more difficult, longer, higher priced bankruptcy compared to a Chapter 7. you will be required to file a “Plan” with the court, which proposes how you will pay back some, or all, of your debt, and how long you will take to pay that debt back if you file a Chapter 13 bankruptcy. Federal legislation calls for that you’re in a Chapter 13 bankruptcy for no less than three years, and no more than 60 months. Due to this right time requirement, if you’re eligible to discharge all of your debts, that won’t happen for 36 to 60 months. The program which you must have enough income to pay all of your necessary monthly expenses, as well as your monthly Plan payment that you propose to the court must be approved by the court, and one of the criteria necessary to get approval of your Plan is. Many people that are eligible for SS and SSDI advantages (and these advantages are their only earnings) get a quantity that is well below their month-to-month costs, therefore qualifying for a Chapter 13 is usually extremely hard for a person who just gets SS or SSDI advantages.

You receive SS or SSDI benefits, these benefits are exempt under bankruptcy law if you choose to file a Chapter 7 bankruptcy and. This implies if you file bankruptcy that you will not lose these benefits. Including lump sum payment payments, previous payments, present re re re payments, and payments that are future. Nevertheless, it is critical to keep in mind that this earnings is just protected to your level you could show the cash you have got readily available, or in a free account, arrived entirely from SS or SSDI advantages. Once more, you receive from any other source, you jeopardize the protection bankruptcy provides your SS or SSDI benefits (this does not include any SS or SSDI benefits you will receive after your bankruptcy is filed – future SS and SSDI benefits are always protected from turnover in bankruptcy) if you comingle your SS or SSDI benefits with funds. To totally protect your SS or SSDI advantages from return in a bankruptcy, that you maintain a separate account ONLY for your SS or SSDI benefits, and that you NEVER deposit any other type of funds in that account as I mentioned before, I highly recommend. This way you notably decrease the danger you will lose SS or SSDI advantages in a bankruptcy.

To conclude extremely essentially, if:

1. Your just income is SS or SSDI advantages; and
2. You can’t manage to pay your entire bills; and
3. You aren’t bothered by creditors calling you regarding the debts and/or suing you for anyone debts; and
4. You aren’t worried about your credit history: then

STOP having to pay the debts that aren’t essential to live (medical bills, bank cards, pay day loans, signature loans, signature loans, repossessions, foreclosures, previous leases, past utilities, many civil judgments), save your valuable cash, and don’t file bankruptcy.

1. In the event that anxiety of commercial collection agency and lawsuits that are possible you; or
2. You’re concerned with your credit history; then

speak with a lawyer about bankruptcy.

Please realize, the examples I have supplied in this essay are not exhaustive. Your position may vary from the examples supplied. All information included herein is supposed for academic purposes just and may never be considered legal counsel. All information offered throughout this short article is highly recommended basic information, and certain applications can vary greatly. It will always be essential for you, and if so, how the information I have provided herein will affect you specifically that you talk to a qualified bankruptcy attorney and discuss your particular situation to determine whether bankruptcy is right. Contact us, we’re here to assist.

None for the information supplied herein is supposed to state or imply an attorney-client relationship.