Is Bankruptcy Right for You?

When Should You Not File for Bankruptcy?

Your Income Is Too High

If your income is too high, you won't qualify for Chapter 7 bankruptcy. In these cases, you may be eligible to file Chapter 13 bankruptcy, so long as your debts don't exceed the debt limits set forth under the U.S. Bankruptcy Code.

You Have Too Many Non-Exempt Assets

In the extremely rare case that you have too many non-exempt assets and your attorney cannot protect all of them through exemption planning, you may want to avoid a Chapter 7 bankruptcy, in which a trustee will take the non-exempt assets, liquidate them, and distribute the proceeds to your creditors. in these situations, Chapter 13 might be better for you.

No one will take your assets if your file under Chapter 13, however, your Chapter 13 won't be successful if you lack sufficient monthly income to make periodic plan payments. If you have too many non-exempt assets, you may also want to consider, credit card debt negotiation to settle your debt. Speak to a Milwaukee bankruptcy attorney to learn more about this debt relief option.

You Don’t Want To Damage a Perfect Credit Score

If you have a perfect credit score and don't want it to be affected in any way, then you may not want bankruptcy. A Chapter 7 bankruptcy can remain on your credit reports for 10 years, while a Chapter 13 bankruptcy can appear on your reports for 6 years.

However, before you decide bankruptcy is not right for you, you must first consider the fact than just about any non-bankruptcy debt relief option you chose will affect your credit score in some way or another. You must also consider the fact my credit restoration program can offset much of the negative impact bankruptcy will have on your score.

For these reasons, most who seek debt relief through my office end-up choosing bankruptcy. Still, there are a few rare cases in which some people still choose not to file bankruptcy.

Your Debt Is Not Dischargeable in Bankruptcy

Certain debts such as child support and recent tax debts do not go away when you file Chapter 7 bankruptcy. You may propose a plan to pay these debts through Chapter 13; however, they must be paid in full within 5 years. If you cannot afford to pay these debts within a 5-year time frame, a Chapter 13 bankruptcy won't work for you either. Call Sapinski Law Office, S.C. to discuss your other debt relief options.

You Don’t Have Enough Debt

If your debt is too low, you can't file Chapter 7. If you are seeking help with a $1000 payday loan or a $2500 lawsuit, you can pay them off without interest through Section 128.

You Are Judgment-Proof

Did you know that creditors cannot garnish your Social Security income? If you have no assets and your only income is Social Security, there is nothing creditors can take from you. Filing for bankruptcy can stop creditor harassment, but is not necessary to protect your Social Security income from garnishment.

You Are Not Eligible to File Bankruptcy

If you filed bankruptcy recently, you may find you must wait before you can file again.

You Have Too Much Debt and Are Not Eligible to File Chapter 13

If your total unsecured debts are not less than $360,475, or if your total secured debts are not less than $1,081,400, you are not eligible to file a Chapter 13 case. These debt-level restrictions don't apply in cases filed under Chapter 7.

You Recently Paid Debts Owed to Friends or Relatives or Transferred Property Without First Consulting With a Bankruptcy Attorney

These transactions can seriously complicate a bankruptcy case and can cause people who received your money or property to be involved in your bankruptcy.