It's quick—it only takes a few months to complete. And it's cheap—you don't pay anything to creditors. It works well for those of us whose property consists of the essential items needed to live and work. People with more assets could lose them, however, especially if they own unnecessary luxury items. For instance, you might have to give up your RV, baseball card collection, or timeshare in the Bahamas—even your house or vehicle if you have too much equity in it or you're behind on the payments.
Unlike Chapter 13, Chapter 7 doesn't have a payment plan option for catching up on late mortgage or car payments. So you could lose your home or car if you're behind when you file. Chapter 13 bankruptcy. By contrast, Chapter 13 filers must pay creditors some or all of what they owe using a three- to five-year repayment plan. But the payment plan allows Chapter 13 to offer benefits not available in Chapter 7. For instance, not only do you keep all of your property, but you can save your home from foreclosure or your car from repossession.
If you need time to repay a debt you can't discharge in bankruptcy, you can use this chapter to force a creditor into a payment plan. The biggest downside to this chapter?
It can be expensive. Many people can't afford the monthly payment. Learn more about when filing Chapter 13 is better than Chapter 7. Caution for businesspeople. Be sure to learn about the ins and outs of small business bankruptcies.
The principles discussed apply to consumers only. Bankruptcy wipes out many bills, like credit card balances , overdue utility payments, medical bills, personal loans, and more. You can even get rid of a mortgage or car payment if you're willing to give up the house or car that secures the debt. Putting property up as collateral creates a "secured debt"—if you don't pay what you owe, the lender gets to take the property back.
But you can't discharge all debts. Nondischargeable debts , like domestic support arrearages and recent tax debt , won't go away in bankruptcy, and student loans aren't easy to wipe out you'd have to win a separate lawsuit.
You'll want to be sure that bankruptcy will discharge get rid of enough bills to make it worth your while. We all know that seeing the forest helps us recognize the trees, so it's probably a good time to consider the significant steps you'll take during your bankruptcy journey. Think of this checklist as a roadmap of sorts, but you can also use it to track your progress. The good news? You've already made headway on the first two items! You won't lose everything in bankruptcy. You'll use your state bankruptcy exemption laws to protect your property.
We list the significant exemptions below, but first, understanding the following will help you maximize what you'll keep in your case. Many more exemptions exist—here's where you'll find a more detailed list of Indiana bankruptcy exemptions. Indiana's Department of Financial Institutions adjusts state exemption amounts every six years. The next adjustment will be made in To find the statute itself, check the Indiana General Assembly or consult with a local bankruptcy lawyer.
Exempt your property carefully. The " bankruptcy trustee "—the court-appointed official assigned to manage your case—will review the exemptions. A trustee who disagrees with your exemptions will likely try to resolve the issue informally.
If unsuccessful, the trustee will file an objection with the bankruptcy court, and the judge will decide whether you can keep the property. Believing that the car qualifies as art—at least in his mind—Mason exempts it using his state's unlimited artwork exemption.
The trustee disagrees with Mason's characterization and files an objection with the court. The judge will likely decide the vehicle doesn't qualify as art. Purposefully making inaccurate statements could be considered fraudulent. If you've never filed for bankruptcy before, you'll meet the initial requirement. Otherwise, check whether enough time has passed to allow you to file again. The waiting period varies depending on the chapter previously filed and the chapter you plan to file.
Find out how long you'll need to wait if your situation involves multiple bankruptcy filings. You'll qualify for Chapter 7 bankruptcy if your family's gross income is lower than the median income for the same size family in your state. Add all gross income earned during the last six months and multiply it by two. Compare the figure to the income charts on the U. Trustee's website select "Means Testing Information".
Want an easy way to do this online? Use the Quick Median Income Test. If you find that you make too much, you still might qualify after taking the second part of the " means test.
Qualifying for Chapter 13 can be an expensive proposition because the extra benefits come at a hefty price, and many people can't afford the monthly payment. To qualify, you'll pay the larger of:. Find out more about calculating a Chapter 13 bankruptcy payment. If any part of the claim total is secured, enter the secured amount in the Secured box as shown in Amount of the claim that is secured in question 9 of the claim form. Any amount entered in this box should not be more than the amount entered in the previous step.
If any part of the claim total is priority, enter the amount entitled to priority in the Priority box as shown in question 12 of the claim form.
Any amount entered in this box should not be more than the amount entered in step 9. Browse to attach the document to be filed pdf file. Click Next. Note : The Notice of Electronic Filing displays giving you the document number. Copies of this notice are immediately e-mailed to all participants who receive electronic notification in the case. FRBP g , , b General Information Outside filers are responsible for ensuring that the correct creditor address is used to docket the claim.
An invalid address will likely result in no notices being sent to the creditor. If the address is incorrect, the court will take no corrective action. Indiana Bankruptcy Assistance You may be wondering what sort of bankruptcy assistance is available in Indiana. Indiana Legal Assistance: You may be considering filing bankruptcy in Indiana and wondering what sort of legal assistance is available. You may want to check out any of the following options: Indiana Legal Aid 1 Indiana Legal Aid 2 Indiana Legal Aid 3 Cost of Chapter 7 and Chapter 13 in Indiana Any important question that you are probably asking yourself is what is the cost of attorney fees, filing fees and whatever other costs are associated with bankruptcy.
Attorney Fee: Often different cities and counties in Indiana will have different attorney costs, including variability of cost based on experience.
You may want to check out a Indiana bankruptcy cost calculator to estimate the cost for your zip code. Harrison St. Freeland Northern Gordon E. Gouveia Northern Jacqueline S. Homann Northern Rebecca L. Hoyt-Fischer Northern Yvette G. Kleven Northern Kenneth A. Manning Northern J. Richard Ransel Northern Dustin M. Roach Northern Martin E. Seifert Northern Mark A. Warsco Northern Kimberly A. Wright Southern Charity S. Bird Southern Deborah J. Caruso Southern Kathryn L.
Pry Coryell Southern Gregory S. Fehribach Southern Joanne B. Friedmeyer Southern Jenice R. Golson-Dunlap Southern Paul D. Gresk Southern Michael J. Hebenstreit Southern Thomas A. Krudy Southern R. Petr Southern Gregory K.
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