Bankruptcy is a legal proceeding granted by the Bankruptcy law for debtors suffering from insolvency that they cannot pay back their creditors so that the insolvent debtor will have a chance for a fresh start. The goal of a bankruptcy proceeding is for the debtor to obtain debt relief through bankruptcy discharge where the debts will be permanently wiped out. Once your bankruptcy petition in Washington is granted, the bankruptcy court will issue a court order discharging what you owe to your lender.

What can I get from Filing Bankruptcy in Washington?

When you file for bankruptcy in Washington, you are given:

  •         Bankruptcy protection. Under the bankruptcy rules, if a person files for bankruptcy, he is given protection from creditor harassment, debt collectors, and other collection agencies that may harass the debtor.
  •         The chance to wipe out your debts.
  •         Protection from foreclosure and wage garnishment.
  •         The right to stop repossession of personal property
  •         The right of objection against creditors who fraudulently tries to collect more than what is due.

What are the debts that can be discharged?

In Washington, declaring bankruptcy does not mean that all your unpaid liabilities will be eliminated. There are types of debt that are not subject to dismissal. The debts that cannot be dismissed include:

  •         Child support
  •         Alimony
  •         Debts related to divorce
  •         Student loans
  •         Criminal fines
  •         Tax debt
  •         Secured debt from a secured creditor

Bankruptcy in WashingtonOn the other hand, the State law allows the following debts to be discharged:

  •         Credit card debts
  •         Medical bills
  •         Car loans
  •         Unsecured debts
  •         Student loans (if you experienced undue hardship)

What are Personal Bankruptcy and Business Bankruptcy?

In Washington, there are different types of bankruptcy but the most commonly used can be categorized into Personal and Business Bankruptcy.

Personal bankruptcy allows individuals or married couples to obtain financial freedom for debts they acquired for personal, household, or family purposes.

Business bankruptcy or corporate bankruptcy, on the other hand, refers to businesses where their debts exceed their profits. Business bankruptcies provide better opportunities so that the businesses can recreate themselves upon their failure to repay what they owed.

What are the Types of Personal Bankruptcy in Washington?

According to Bankruptcy Laws, in a bankruptcy, an individual may choose what type he may avail depending on their circumstances financially. The most commonly used Bankruptcy Chapter are:

Bankruptcy Chapter 7 is a liquidation bankruptcy where filing chapter 7 bankruptcy will require a bankruptcy trustee to handle your assets and liabilities.  The trustee will liquidate your nonexempt assets by selling them and he will use the proceeds for debt repayment. The properties you may keep after this bankruptcy act are only those listed in the bankruptcy exemptions.

Filing for bankruptcy chapter 7 requires the petitioner to first pass the means test, a test to determine whether your monthly income is below the median income set by the Bankruptcy Code in Washington. Depending on your disposable income, you can even be exempt from this test.

Another thing you need to undergo before you can avail of Chapter 7 bankruptcy is undergoing credit counseling through an accredited agency.  Such can be done online, personally, or through the phone.

Bankruptcy Chapter 13 is the other commonly used bankruptcy. Chapter 13 is a debt adjustment bankruptcy where you will create a repayment plan so that you can pay all your debts over time through monthly payments. In this chapter, you can keep more of your properties than in Chapter 7. Your Tacoma bankruptcy attorney will discuss these options in more detail. 

Should I file for bankruptcy in Washington?

There is nothing shameful about taking advantage of the protection that the United States Bankruptcy Code offers for there is nothing wrong if you are overwhelmed by your total debt and were forced into bankruptcy. An individual can file a bankruptcy without the help of bankruptcy attorneys in Washington but the bankruptcy process can be very complex. If you are considering bankruptcy but are troubled with some questions, we at James A. Jones Attorney At Law are more than happy to help you. Our experienced bankruptcy lawyers will assess your financial situation and come up with solutions tailored to your needs, from a restructuring of debts to representing you in bankruptcy court. Call us now for a free legal consultation.

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