There are a handful of components that are associated with financial troubles. A few common reasons include heavy debt, divorce, illness, foreclosure, or sudden unemployment.
In fact, the average credit card debt in Mississippi is a whopping $4,689 per person. In addition, foreclosure rates are also as staggering, one out of every 5,221 MS homes is currently in foreclosure.
If you find yourself struggling with similar situations, then you are probably facing other personal problems that come with being in debt. The fear of losing your car, home or your money can drain a person physically. You have probably even considered Filing Chapter 7 or Chapter 13 Bankruptcy .
If you are thinking “Can I File Bankruptcy?” you are certainly not alone. Just under a million people file bankruptcy each year in America. Bankruptcy is a means established by the US Government to help struggling Americans find relief from heavy debt. You may want to consider filing bankruptcy if it’s best for you.
What Is Bankruptcy?
Bankruptcy gives people the opportunity to resolve their debt while still working with lenders in a legal capacity. It is initiated by an individual filing a Petition with their nearest bankruptcy court. The Petition can be filed by an individual or married couples jointly. When the bankruptcy is done, the filer will ‘exit’ with a fresh new start.
Throughout the bankruptcy, a trustee is appointed to oversee the deatils of the case. His or her responsibilities differ and depend on whether the person has filed for Chapter 13 or Chapter 7 bankruptcy.
Did you know that Mississippi ranks #9 in the nation for bankruptcy filings. In 2017 the number of personal bankruptcies was approximately 374 out of every 100,000 residents.
What Is The Difference Between Chapter 7 And Chapter 13?
People in Mississippi, who claim bankruptcy, will elect to file under Chapter 13 or Chapter 7 of the U.S. Bankruptcy Code. Want to know the difference? Look below for more information
In exchange for dissolving all past due debts, the trustee of the bankruptcy will liquidate the assets, such as cars, homes, and other property of value in a Chapter 7 Bankruptcy proceeding.
Debtors that were listed on the bankruptcy filing will be repaid with the proceeds collected during liquidation
If you have the means to pay some of your debts, a chapter 13 bankruptcy plan may work for you. You will be allowed to retain your valuable assets over a 3- to 5-year time frame.
In order to determine which chapter a person can file, they will have to determine their ability to repay under the Bankruptcy Means Test.
What Is A Bankruptcy Means Test?
The ultimate goal of the Bankruptcy Means Test is to determine who is eligible to apply for debt forgiveness through a Chapter 7 Bankruptcy. It takes into account your:
- income and expenses
- household size and composition
- debt-to-income ratio
For those who do not qualify for a Chapter 7 filing, he or she will be able to file for Chapter 13, as described above.
What Are Bankruptcy Exemptions?
Specific states have certain exclusions that are enacted by congress as federal bankruptcy exemptions for filers. These exemptions will determine what you are able to retain throughout and after Chapter 7. In a Chapter 13 situation, the exemptions will determine what amount you will have to pay certain financial institutions in your repayment plan.
- Property you own and occupy to $75,000, but cannot exceed 160 acres. You may claim a former residence if you are over 60 and married or widowed. Sale proceeds are also exempt. A mobile home may qualify for exemption if you own land on which it is located. May file homestead declaration. Married couples can double only if they are living in separate residences.
- Mobile home up to $30,000. State health savings plans. Tax-qualified 529 education savings plans, including those under the Mississippi Prepaid Affordable College Tuition Program. Proceeds from exempt property. Tangible personal property of the following items up to a cumulative total of $10,000: any item worth less than $200 each, clothing, furniture, appliances, 1 radio and 1 television, 1 firearm, 1 lawn mower, linens, china, crockery, kitchenware, and personal effects (including wedding rings) of the debtor and dependents (but not works of art, other electronic entertainment equipment, jewelry (other than wedding rings), and items acquired as antiques), books, animals, crops, motor vehicles, cash on hand, health aids.
- Personal injury judgments up to $10,000.
- Earned but unpaid wages owed for 30 days; after 30 days, the greater of the following: minimum 75% of unpaid weekly earnings or 30 times the federal minimum hourly wage; judge may allow more for low-income debtors.
- Tax exempt retirement accounts (including 401(k)s, 403(b)s, profit sharing and money purchase plans, SEP and SIMPLE IRAs, and defined benefit plans).
- IRAS and Roth IRAs to $1,283,025.
- Municipal employee benefits.
- State retirement benefits.
- Teacher retirement benefits.
- Public officer and employee retirement benefits and deferred compensation.
- IRAs, Keoghs, and ERISA-qualified benefits, if deposited more than 1 year before filing.
- Assistance to the blind.
- Assistance to the aged.
- Assistance to individuals with a disability.
- Workers’ compensation.
- Unemployment compensation
- Earned income tax credits and state and federal tax refunds up to $5,000 each.
- Crime victims’ compensation.
- Life insurance or annuity proceeds held by the insurer.
- Fraternal benefit society benefits.
- Disability benefits.
- Homeowners’ insurance proceeds up to $75,000 (plus $250 in personal property).
- $50,000 of any property, including monetary deposits, available to a Mississippi resident who is at least 70 years old.
Want to know if you can include Student Loans in Bankruptcy or Medical Bills in Bankruptcy? Check out our Bankruptcy FAQ’s section.
Filing Bankruptcy Alone vs. Filing With An Attorney
Current laws do not require individuals to hire a lawyer to declare bankruptcy relief. People are permitted to represent him or herself as a pro se debtor. You will simply contact the local bankruptcy court and obtain all forms and requirements directly through them. Going it alone is not an easy task.
Filing Bankruptcy without an Attorney
A simple Chapter 7 Bankruptcy that doesn’t have a lot of debtors or assets may be easy to manage on your own.
A basic bankruptcy that doesn’t require an attorney might look like:.
- Your income is below the state median;
- You have no property;
- Your debts will be considered dis-chargeable.
Working With An Attorney
In most cases, it is usually in one’s best interest to work with a bankruptcy attorney. A bankruptcy attorney is there to represent you and not in the interest of creditors.
An attorney is also accustomed with exemption laws. In addition, they can come up with creative strategies to keep your assets through practical repayment strategies that are fair to everyone involved.
While you may have the fight and ability to manage a Bankruptcy on your own, it tends to make things a lot easier on an already stressful situation, especially when there is so much at stake.
What Does Bankruptcy Include?
Once you file for bankruptcy in MS, the courts put in place an order called an Automatic Stay. This order will stop debt collection calls, wage garnishments, and additional claims. Keep in mind that payments regarding child support and criminal cases will still need to be made during this time.
In any event, Bankruptcy will be able to include:
- credit card debt
- protection from eviction
- avoidance of foreclosure
- utility bills
- medical expenses
Again, unless you are filing a complex Chapter 13 case, you will lose all assets associated with a Chapter 7 Bankruptcy protection. You will, however, be able to prevent any and all collections from occurring as long as they were incurred before the date of filing and discharge.
Final Thoughts And Considerations On Filing For Bankruptcy In Mississippi
As you can see, there a lot of information associated with successfully filing for bankruptcy and then exiting it unscathed or satisfied. Only a licensed bankruptcy attorney can guide you through this arduous process, particularly when it comes to complex cases. Be sure to hire someone you respect and trust.
Bankruptcy Courts In MississippiEast Court Street
501 East Court Street
Mississippi Southern Bankruptcy Court
Dan M. Russell, Jr. United States Courthouse
2012 15th StreetGulfport,MS 39501
Mississippi Southern Bankruptcy Court
Thad Cochran United States Bankruptcy Courthouse
703 Hwy 145 North
Mississippi Northern Bankruptcy Court
Additional Mississippi Resources
Foreclosure Help Program
Disability SSDI Benefits