As the impact of the coronavirus continues impacting the livelihood of many individuals, people are contemplating whether or not they should be filing bankruptcy. With so much uncertainty many individuals have lost their income and feel that they have nowhere to turn. The Coronavirus outbreak is leaving many individuals confused about their finances. Below we will look at whether filing bankruptcy because of the coronavirus is the right choice for you.
Will I get Money Under the CARES ACT?
Under the CARES Act if you own a business you may be able to get some help to push you through the end of this. Moreover, if you make less than $75,000 per year you will be getting a stimulus check in the mail for $1,200. Further, the CARES Act includes money for unemployment benefits as well as certain loan programs for small businesses, self employed, and 1099 contractors. If you don’t think that this money will be able to hold you over, or you don’t qualify for these programs filing bankruptcy can be a good option.
Will Filing Bankruptcy Help Me?
Individuals file bankruptcy everyday. Bankruptcy is a tool to help people get back on their feet by eliminating their debts. A Chapter 7 bankruptcy, can help eliminate unsecured loans, medical bills, credit card debts, and even some tax debt. Filing bankruptcy can help you get back on your feet by allowing you to start over.
What Happens When a Chapter 7 Bankruptcy is Filed?
When you file bankruptcy in New York or New Jersey, you will be able to start your life over again. Filing a Chapter 7 bankruptcy petition, will allow you to get some financial relief.
To qualify for bankruptcy, you will need to pass a Means Test. Both New York and New Jersey have different incomes that determine whether or not you qualify for a Chapter 7 bankruptcy. The Means Test takes the last 6 months of income, and compares it to the household median income for a family that is of similar size in the state you live in. Qualifying under the means test is extremely important. If you file a bankruptcy petition and don’t qualify under the means test your bankruptcy case will get dismissed.
What Will Happen to My Property and Assets If I File Bankruptcy?
Bankruptcy Courts enacted the bankruptcy laws to allow individuals to start over. New York and New Jersey have different bankruptcy exemptions that allow you to keep your property and assets even though you are filing bankruptcy. Many individuals who file Chapter 7 bankruptcy don’t own any property. Thus, many don’t have to give anything up when they file. A good bankruptcy lawyer will be able to help you navigate through the different bankruptcy exemptions.
Should I Start Planning To File Bankruptcy
If you are thinking that you may need to file bankruptcy in the future, you may want to consider pre-bankruptcy planning. This may seem like you are trying to get away with something by planning your bankruptcy, but this is not the case at all. It is important to understand how the bankruptcy process works, and how you, as an individual or business will be impacted by filing bankruptcy. Bankruptcy laws are complicated and speaking with a bankruptcy lawyer beforehand can be a good way to ensure that you are on the right path.
There are certain things you should not do before filing bankruptcy that includes charging on your credit cards and taking out more loans. You also shouldn’t give away your property or sell any of your assets. Keep in mind, that there are certain things you can sell, as long as you sell it for fair market value. It is important to speak with a bankruptcy lawyer who will help you navigate the rules and laws of bankruptcy.
Karra L. Kingston Esq. has helped many people who are in debt file bankruptcy. If you are unsure about how to navigate the coronavirus pandemic and what you should do, our bankruptcy lawyers can help you. If you have lost your income due to the coronavirus and are riddled with debt, speaking with someone now may be a good idea.
