How Can Bankruptcy Help Me?
The decision to file for bankruptcy is never an easy one, however it should be made after consulting with Seattle bankruptcy lawyers in order to make sure that you are making the right decision for you. The general rule that you should follow in order to decide whether to file for bankruptcy is whether you can foresee yourself paying off the debt in the foreseeable future. If the answer is no, then you want to make sure that your debt will in fact be discharged by a bankruptcy filing and that you have no assets that over the allowable bankruptcy limits for your state. Debts such as those owed to the government or city for fines or criminal activity may not be dischargeable, however taxes over three years old from the date they were due may in fact may be able to be discharged.
In order to qualify for a chapter 7 bankruptcy where most of your debt will be forgiven, a debtor must have a below median household income. This is determined by the number of dependents in a household and whether the debtor is married. Therefore, even high income earners with several children may qualify for a chapter 7 bankruptcy.
The next step is to determine whether you have any assets that are above the allowable bankruptcy exemption limits. This is something that will have to be discussed with a Seattle bankruptcy lawyer in order to make sure all of your possessions will be protected. Generally, most people are allowed to keep all of their possessions. In Washington state you can choose to use federal or state exemptions. The state exemptions are best used if you have equity in your home as you can protect up to $125,000 in equity, but the other exemption categories are lower. The federal exemptions offer higher exemptions for everything else such as household goods, vehicles, and even a wildcard exemption that can be used on whatever property you wish to protect. Therefore if you do not think that you will be able to pay off your unsecured debt, bankruptcy may be an option for you.