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Chapter 13 bankruptcy in Wisconsin | An overview

If you are like most residents in the Appleton region of Wisconsin, filing for bankruptcy is the last debt relief solution on your list of options. People naturally fear bankruptcy even though it does not carry the stigma it once did. When you realize that this option is your best choice, you must then decide whether to pursue a chapter 7 or a chapter 13 bankruptcy.

If you listen to your peers, they might tell you to take chapter 13 off the table if possible. However, we like to advise our readers to consider all options before making a decision. A chapter 13 bankruptcy is known as a reorganization bankruptcy because it enables you to reorganize your debts. This option allows you to hold on to much of your property, meaning that you will not lose your home and other assets.

Filing a bankruptcy in the middle of an emergency

Most of the time, people facing financial disaster should avoid rushing the process of filing for bankruptcy. After all, a bankruptcy that works in your best interests benefits from careful planning and preparation. Unfortunately, life does not always give those facing financial problems time to prepare.

What would you do if an emergency arose while you are planning and preparing for your bankruptcy? As you might expect, additional financial hardships can turn an already urgent situation into a true crisis. For example, say you or your spouse becomes sick with a serious illness. Dealing with the illness on top of your preparations for bankruptcy will likely worsen finances and put additional strain on your mental and emotional health.

Student loans and undue hardships

Have you heard that it's impossible to discharge student loans in bankruptcy? This is a very common myth. Though it can be difficult and it is not a viable option for everyone, it is not impossible.

The key is to show that the student loans are more than just debt you don't want to pay back or debt that is hard to afford; they actually create an undue hardship in your life. They're destroying your quality of life, you have no way to pay them back, and that's not likely to change.

What does the bankruptcy means test entail?

The bankruptcy means test is a process debtors undergo to find out if a chapter 7 bankruptcy is the right path. The test identifies whether or not a debtor is eligible for chapter 7. Unless you are a disabled veteran, you will have to go through the means test process before you can file a chapter 7 bankruptcy. Veterans who are more than 30 percent disabled may bypass the means test.

The test consists of two parts and is in place to curtail any abuse of the bankruptcy system. The first step involves a comparison of your average income going back for six months with the state of Wisconsin's median family income. If your income is less than the Wisconsin median income, then you are probably eligible to file for chapter 7 bankruptcy.

A lawyer's role when searching for debt relief

If you are struggling with overwhelming debt, we want to assure you that you are not alone. Many of our neighbors in Appleton and other areas of Wisconsin are in the same boat. One thing you and these people probably share is a desire to find debt relief and start a new chapter in your life.

Another common denominator you might share with others in debt is a fear of debt relief and debt management companies. You are right to be cautious as many of these so-called agencies operate insidious swindles designed to bilk you out of what remains of your money. You may wonder who, if anyone, can you trust to offer you honest assistance that will not cause any further damage to your already precarious financial situation.

Many people with cancer have to worry about bankruptcy, too

When you first get diagnosed with a chronic or life-threatening illness, you worry mostly about your health and future. Will you see your children (or grandchildren) graduate school? Will the treatments cause pain and discomfort? Will you be part of the percentage of people who "beat" this condition?

Very few people think about the financial implications of a chronic or serious illness until reality rears its ugly head. Even if you have the best insurance in the world, a single treatment could cost tens of thousands of dollars. Any amount of co-insurance, even 5 percent, could quickly become overwhelming.

Debt, bankruptcy and gender: Is there a link?

Have you been wondering if men and women look at debt differently? Is one gender more likely than the other to fall into bankruptcy? Some studies suggest that could definitely be the case.

For example, men do tend to have more debt than women. The difference isn't huge, but average debt held by men is 4.3 percent higher.

Can anyone declare bankruptcy?

Technically speaking, anyone can declare bankruptcy. However, that doesn't mean anyone is eligible. It is an option for everyone in Wisconsin, but specific eligibility is considered on a case-by-case basis.

For example, for those considering Chapter 7 bankruptcy, a means test may be used. This test simply looks at financial obligations, income and other such factors. In essence, since Chapter 7 means the debt is eliminated after the liquidation of assets, you have to show that you really don't make enough to pay off that debt.

It's illegal to be dishonest during bankruptcy

You know that you're not supposed to be dishonest when declaring bankruptcy, but it's tempting. You don't want to lose certain assets. Wouldn't it be easy not to report that you own them in the first place?

What you should know is that you're not just breaking the rules by willfully concealing assets. You're breaking the law. Never do this under any circumstances.

5 tips for post-bankruptcy life

One of the prevailing myths about bankruptcy is that it wrecks your life. People talk about never being able to buy a home, buy a car, start a business or get a credit card.

This is a myth for a few reasons, but let's focus on one of the biggest ones: You can rebuild your financial life after bankruptcy. It's probably not even as hard as you think. Below are five key tips that can help.