The decision of whether to file a Chapter 7 bankruptcy in Mobile is important and should not be made lightly. However, many times it is the only decision that truly makes sense. Folks can find themselves stuck in what seems like a revolving door with no way out but filing bankruptcy in Mobile may be the perfect way out. A Chapter 7 eliminates unwanted debt that may have come about because of uninformed choices or may be due to an issue totally beyond the control of the people faced with filing. If the debts are medical in nature or are due to credit card usage or payday loans, filing a Mobile bankruptcy may be exactly the right cure. Mortgages that are behind, and can’t be caught up, might point more to a Chapter 13. In a 13, you are able to make payments for up to 60 months to catch up with your payments. If you own assets that exceed what you may be able to keep in a Chapter 7, once again, Chapter 13 might be the better option. The difference between 7 and 13 is important to review. There is no public parking at the bankruptcy court in Mobile, but plenty of pay lots close by. You might enjoy breakfast or lunch at Bob’s Downtown Restaurant, located at 263 St. Francis St. in Mobile. It’s an old fashioned diner with sidewalk seating. People like Joe Namath and Walt Disney have had to file bankruptcy. You are in good company. Unlike Namath and Disney, you may need free legal aid services. Legal aid is available in certain areas but does not always handle bankruptcy issues.
Mobile Bankruptcy Lawyers, Estimated Cost
The cost of a bankruptcy lawyer varies a lot. If you live in Mobile, Baldwin, Washington, or Clarke counties, you may be able to get help from the South Alabama Volunteer Lawyers Program at savlp.org. This is a program made available by the Alabama Bar Association. If you do not qualify for their services, Mobile bankruptcy lawyer cost may be as low as $815 and can go up as high as $1,500. Some attorneys offer a free consultation. If you go to one who does, make certain you find out all of your potential cost for doing business with their firm. The cost for folks seeking help can include extra fees for anything that not everyone filing bankruptcy in Mobile has to complete.
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How to File Bankruptcy in Mobile, Alabama for Free
Filing bankruptcy in Mobile is simply a matter of carefully following certain steps. If you follow these steps, you should have a successful Alabama bankruptcy.
Collect Your Mobile Bankruptcy Documents
Your Mobile bankruptcy requires that you put together certain forms. Nothing worth doing is ever successful without proper preparation. In the case of filing bankruptcy in Mobile, proper preparation means gathering all the information you will need. You will need to have the last two years of tax returns. If you did not keep copies be sure to get them from your tax preparer, such as H&R Block. If you did them yourself online, print off an extra copy. If you didn’t use a tax preparer and can’t find them online, you will need to request transcripts from the IRS. You can go to their website and hit the button for ordering transcripts. There are different types of transcripts, and you need the one that shows you tax return. The law has now changed to give you a safer copy than in the past. It will have, however, all of the information you will need. It will also protect you from identity theft. You will also need your pay stubs from the last six months, and bank statements for six months as well. Most folks can go online for the bank statements, but if you need to make a trip to your bank, do so. Employers can generally provide pay stubs. Some employers require you to go to a third party provider if the employer does not make out their own stubs. You may need to provide additional documents at some point, but these are essential for a good jump on the process. Your Chapter 7 bankruptcy in Mobile will be easier if you get these together early.
Take Credit Counseling
Credit Counseling is a requirement for filing a Chapter 7 bankruptcy in Mobile. It must be done before the case is filed. A Certificate of Completion must be obtained. You will need to give the original to the clerk of the court when you file your Alabama bankruptcy case. You can do the course online or over the phone. It should take about an hour to complete. The class must be taken from an approved list of providers. You should expect to review basic financial ideas. Many of those ideas are things that typically lead people to file bankruptcy in Mobile and elsewhere.
Complete the Bankruptcy Forms
Filing bankruptcy in Mobile requires you to fill out a number of forms. Making certain you have a statement from each creditor is very helpful. Keeping your bank statements handy will also help. You are required to list all of your income and expenses. A lot of folks have no idea how much they spend, and what they spend it on. An honest effort to list all expenses can be very eye opening. Be thorough. Take your time to make your disclosures on the bankruptcy forms as complete as possible.
Get Your Filing Fee
Handling of your Mobile bankruptcy file takes time and effort by the clerk’s office. It costs money to do anything, as you know. The court clerk has a budget, and your filing fee is a vital part of their office being efficient. Having said that, it is sometimes possible to have that fee waived. If your income is at 150% of the poverty level or less, and you can’t afford to pay the fee even after filing your case, the filing fee can be waived. If not, you may be able to pay it in installments. If you are able to pay the fee in one payment, we suggest you do so. That will guarantee that you do not forget to make an installment payment. Failing to pay on time could result in the dismissal of your Alabama bankruptcy.
Print Your Bankruptcy Forms
Filing bankruptcy in Mobile will require that you print out all of your forms. You need at least two copies of all forms. If you have a printer at home, this part requires very little time. If you don’t, but a friend or family member lets you use theirs, it’s recommended that you bring your own paper to print on, as one copy will probably be about 60 pages and you should print two full sets so you have one to keep in your files.
Go to Court to File Your Forms
Your Chapter 7 bankruptcy in Mobile needs to be filed in the U.S. Bankruptcy Clerk’s office. It is located at 201 St. Louis St., Mobile, AL 36602, and is in the U.S. Bankruptcy court. When you arrive at this location you will need to pass through a metal detector, which is set up to provide protection for everyone in the building, including you. Be sure to take at least two complete sets of your forms. The clerk will review your documents to make sure everything is properly signed. You can request your second set be date and time stamped. The second set is just to make sure you have a permanent record of what you have filed. You do not have to give your copy to anyone. Actual notice is all that the Bankruptcy Code requires to put a creditor on notice of your Alabama bankruptcy.
Mail Documents to Your Trustee
A Chapter 7 trustee is a person randomly chosen from a panel of trustees. Their job is to check your documents and make inquiries to be certain all needed information is fully disclosed. You need to provide the last two years of tax returns and, most likely, six months of paystubs and six months of bank statements. The bank statements are needed for any account that you are, or were, authorized to use, even if you have closed it. It is common, when you file a Mobile bankruptcy, to receive a letter from the trustee with a list of documents they want mailed to them. Read the letter carefully to make sure you respond on time.
Take Bankruptcy Course 2
Just like with the first course you took, a Mobile bankruptcy will require that you use an approved financial management course provider to do your second class. The purpose of the financial management course is to help you to budget for going forward after your Chapter 7 bankruptcy in Mobile is completed. If you had a good experience with the provider of the first class, you may want to use them again, if they are on the approved list. This course will take longer than the first one, so you will want to set aside adequate time in order to complete it. As with the first class, you can do this one online or on the phone. If you use a cell phone, be sure to keep the charger connected. You don’t want it to die in the middle of the class. Once done, be sure to submit your certificate of completion to the Alabama Bankruptcy Court. Without that, your discharge can’t be entered.
Attend Your 341 Meeting
Every Alabama bankruptcy requires the folks filing the case to attend a 341 meeting. It is often called a creditors’ meeting. It is a meeting, and not a hearing. The difference is there will not be a judge in attendance. The Chapter 7 trustee will conduct the meeting. You will be under oath, and must make sure you speak the truth. Dress appropriately, meaning no shorts and flip flops. Your Mobile bankruptcy 341 meeting will likely only last for 5 to 10 minutes, but you may have to wait a while for your case to be called. This may very well be the only time you will go to any proceeding.
Dealing with Your Car
As part of your Alabama bankruptcy, you will have 3 options on how you want to deal with your car. Reaffirming the debt is one option. When you reaffirm a debt, you will sign an agreement that says you will pay for the vehicle as originally agreed. Second, you can attempt to redeem your car. Redemption, or redeeming, is a process to refinance the vehicle for its actual book value. That could be much less than what you owe, but the interest rate on the new loan will likely be very high. Redemption is usually best if you can afford to pay for car’s value without taking out a new loan through a bank. Your Chapter 7 bankruptcy in Mobile actually gives you a third choice. You can surrender the car, and owe nothing on the debt. You can find an inexpensive car to get you by until you can afford what you would really like to have further down the road.
Alabama Bankruptcy Means Test, Bankruptcy Forms, and Exemptions for Mobile
Alabama Means Test
Every state has a record of the average income for folks considering filing bankruptcy. The purpose of the income records in a Mobile bankruptcy is to determine if an individual or married couple can file a Chapter 7 or needs to consider filing a Chapter 13. The Alabama bankruptcy means test looks at the median income for the household. If you have two people in the household, the median income will be lower than if you have five people. The income limits for the state of Alabama will give you a good idea of how much you can make and file a Mobile bankruptcy. The Alabama bankruptcy means test is specific to folks living in Alabama.
Median Income Levels for Alabama
Alabama Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
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Poverty Levels for Alabama
Alabama Fee Waiver Eligibility for Cases Filed On or After May 1, 2020
Eligible for fee waiver when under 150% the poverty level.
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Alabama Bankruptcy Forms
Alabama bankruptcy forms consist of a Petition, Schedules A-J, and Statements. When you are listing your personal property, use garage sale values. It does not matter what you paid for something. The question is, what is it worth? Also, in filling out your budget information, be sure you do not shortchange yourself by estimating too low on your expenses. Get out your bills and bank statements to make sure you include everything. The Alabama forms will need as much detail as possible.
Alabama bankruptcy exemptions are specific to the State of Alabama. The government puts out federal bankruptcy exemptions, but they can’t be used in Alabama, so your Mobile bankruptcy will follow the Alabama exemptions. Chapter 7 exemptions vary from state to state. Your Alabama exemptions will let you know what property you can keep if you file bankruptcy.