BANKRUPTCY OPTIONS EXPLAINED
It can be confusing to wade through the different bankruptcy and debt relief options. The table below helps to simplify the options debt relief and bankruptcy protection options available in Southeastern Wisconsin. For additional information or to talk through your specific situation. Schedule your FREE consultation online or call (262) 705- 5473.
Chapter 128 Alternative
Basics: A Chapter 7 bankruptcy will discharge most types of unsecured debt. The trustee will sell any significant nonexempt property in order to repay your creditors.
Time Frame: A typical Chapter 7 bankruptcy case takes about 90 days to complete.
Property: Many Chapter 7 debtors keep all or most of their property. Petitioners with significant equity or assets that are not exempt by law could lose them to satisfy some debts.
Your Income: Not all debtors may qualify for this chapter due to a limit placed on annual income and household size.
Homeowners/Foreclosures: Chapter 7 can temporarily stop foreclosure, but unless you can get current on your mortgage, the foreclosure will eventually continue.
Eligibility: Chapter 7 is available to those whose income is less than the median of their state, or those who can pass the means test. You will not be eligible for a discharge if you received a discharge in another Chapter 7 or Chapter 11 case filed within the prior eight years, or in a Chapter 12 or Chapter 13 case filed in the prior 6 years, unless the prior Chapter 12 or Chapter 13 payment plan either paid 100% of the unsecured claims or paid 70% of the unsecured claims and was proposed in good faith and represented your best effort.
Filing Complexity: Filing for Chapter 7 involves preparing a large set of forms and navigating some tricky legal issues, but simple cases can be done pro se - that is, without hiring an attorney.
Basics: In Chapter 13 bankruptcy, you repay your creditors (some in full, some in part) through a Chapter 13 repayment plan.
Time Frame: The Chapter 13 payment plan lasts three or five years (depending on your income). At the end, a majority of your unsecured debts will be discharged.
Property: No property is liquidated under a Chapter 13 bankruptcy.
Your Income: Chapter 13 requires a regular income for the monthly payment.
Homeowners/Foreclosures: Chapter 13 can stop a foreclosure and you can make up past due mortgage payments through your repayment plan.
Eligibility: Chapter 13 has no income requirement, but unsecured debt must be below $383,175 and secured debt below $1,149,525. You not eligible for a discharge if you received a discharge in another Chapter 13 case filed in the prior two years, or in a Chapter 7, Chapter 11 or Chapter 12 case filed in the prior four years.
Filing Complexity: Chapter 13 bankruptcy involves submitting a repayment plan to the court, and will almost always require hiring an attorney to complete successfully.
Basics: A debt relief alternative to Bankruptcy through the Wisconsin statutes. In a Chapter 128, one can avoid garnishments and high interest by proposing a repayment plan on specific debts.
Time Frame: A Chapter 128 plan must be completed in 36 months.
Property: Property is not a factor in a chapter 128 and does not need to be disclosed.
Your Income: Chapter 128 plans require monthly income.
Homeowners/Foreclosures: Not applicable under Chapter 128.
Eligibility: Must be a resident of the state of Wisconsin.
Filing Complexity:Chapter 128 involves filing a petition, an affidavit and a proposed order with County Clerk of Court. It is a cheaper and easier alternative to Bankruptcy.