New Orleans Bankruptcy Lawyers
Helping debtors in New Orleans and Slidell obtain financial relief
There is no shame having to file for bankruptcy. Many people file for bankruptcy because they lose a job, they have a medical condition that they can’t afford, they’re trying to live separately after a divorce, or for many other reasons. Many people in New Orleans and Slidell accumulate credit card debt. Some people lose money because the value of their homes decreases. Whatever the reason, you should know that bankruptcy is a way to stop creditors from calling you so you can breathe. Bankruptcy is a way to start your financial life over.
If you don’t have any secured property such as a home, then a Chapter 7 bankruptcy is likely your best option. If you own a home or have other assets you want to protect, then a Chapter 13 bankruptcy is a way to help save your home and secured assets. At the Law Office of James A. Graham, our New Orleans bankruptcy lawyers review your debt situation and explain your options. We work with your creditors and the trustee in bankruptcy to help you pay the bills you can and discharge the rest.
What are the different kinds of debts?
Our first step is to review all your debts, income, and assets so we know your complete financial picture. There are several types of debts:
- Secured debts. Secured debt means that you pledged some property (collateral) to secure the debt. This means you agreed that if you default on your debt, the creditor can take possession of the property you pledged to pay off the balance of the debt. The most common example of a secured debt is when you apply for a mortgage to secure your home. Many car buyers also grant the seller of the car or a car finance company a security interest in your car.
- Unsecured debts. Debts that are not secured are called unsecured debts. Common unsecured debts include credit card debt and medical bills.
Priority debts. Some of your debts are considered priority debts, which means you can’t discharge them in bankruptcy. Common examples include child support, income taxes, and student loan debt.
Are there alternatives to bankruptcy in New Orleans?
It may be possible to avoid bankruptcy by negotiating agreements with the creditors to extend the loan payments and/or reduce the amount of the payments. Another remedy is to obtain a new loan to pay off your various debts. Of course, you’ll have to pay the new loan. Sometimes, however, this is advantageous if the current interest rate is lower than the interest rates on your existing loans.
The right to file for bankruptcy is in the US Constitution, so you should know that even the Founding Fathers anticipated that many people would need help if they got into financial difficulty.
What is the “automatic stay” provision?
The automatic stay provision is a way to obtain immediate relief from creditors constantly calling you, sending you notices of delinquency, and starting legal action, including foreclosure proceedings.
The moment you file your bankruptcy petition, whether a Chapter 7 or a Chapter 13, creditors must cease all collection activities. A trustee will be appointed by the Bankruptcy Court to represent their interests. The stay removes the pressure of harassing creditors while you straighten out your finances. While there may be situations where creditors can obtain relief from the automatic stay, in most cases, the stay continues until your discharge in bankruptcy.
What is a Chapter 7 bankruptcy?
Chapter 7 bankruptcy is normally used if you do not have secured debts. Our New Orleans bankruptcy lawyers will file the petition for you, represent you at the trustee meeting, and respond to any issues raised by the creditors. Many people with credit card debt and medical bills use Chapter 7 if they don’t own a home or have other secured debts, and don’t have valuable assets. After the meeting with the trustee, if there are no complications (there usually aren’t), the Judge will order that all your unsecured debts be discharged.
In a Chapter 7 bankruptcy, you can protect some of your assets such as equity in a home, vehicle, bank accounts, jewelry, and tools of your trade – up to specific dollar amounts. For some assets, like cars, you can also enter into a reaffirmation agreement to save them. In a reaffirmation agreement, you agree to continue the car payments after your discharge in bankruptcy.
How does the means test work in New Orleans?
Changes to bankruptcy laws in 2005 now require that debtors complete a means test to determine if they are eligible to file a Chapter 7 bankruptcy. The test examines your income and compares your income to regional averages depending on the size of your family. If your income is above the limit, you must file a Chapter 13. Our New Orleans bankruptcy lawyers will explain what income is counted, and what income isn’t. For example, generally, Social Security income is not counted as part of the means test.
What is a Chapter 13 bankruptcy?
Chapter 13 bankruptcies require that debtors file a plan after they file their petition. The debtors who use Chapter 7 are those whose income is above the means test requirement, even if they only have unsecured debt. Most debtors who use Chapter 13 are trying to save their homes or other secured assets.
The Chapter 13 plan requires that you pay off your arrears on your unsecured debts over a three-to-five year period. You must continue to pay the future secured payments as they become due. Unsecured debts are handled differently. Generally, the debtor proposes to pay a portion of the unsecured debts over the same three-to-five year period. Once the planned payments are complete, the balance of the unsecured debts are discharged while you keep your secured property. You’ll still have to make the future payments on the secured property.
While you cannot discharge your priority debts, you generally can pay the arrears over the three-to-five year period, provided you make the future payments (family support, taxes, etc.) as they become due.
Do you have a bankruptcy lawyer near me?
The Law Office of James A. Graham is located in New Orleans and serves all of South Louisiana.
For clients who are unable to travel, we can schedule phone or video conferences when needed.
Speak with our experienced New Orleans bankruptcy lawyers today
Get relief from your creditors now. At the Law Office of James A. Graham, we’ve helped many debtors get a fresh start. We’ll help you decide whether there are bankruptcy alternatives, and whether you should file a Chapter 7 or Chapter 13. We’ll be your voice with the trustee who is assigned to your case. We’ll also explain the steps you can take after bankruptcy to help slowly restore your credit. To discuss all aspects of bankruptcy, please call us or complete our contact form to schedule a consultation with a respected bankruptcy lawyer in New Orleans.