Written by Attorney Eva Bacevice.
Updated August 23, 2019
Financial hardship is everywhere these days and Hub City is no exception. The home of rockabilly music, located halfway between Memphis and Nashville on the Heart of the Music Highway, Jackson, Tennessee has seen its fair share of the downturn in the economy in recent times. If your financial situation has gotten worse, you might well be thinking about your options and exploring the possibility of filing bankruptcy in Jackson. You can seek assistance through legal aid to explore your options based on your circumstances.
If you do decide to file bankruptcy, you will need to determine whether to file a Chapter 7 or a Chapter 13. Chapter 7 is what you think of as a “traditional” bankruptcy. It’s a liquidation where you can walk away from some, if not all, of your debts and get a fresh start. Chapter 7 is fairly short and can be completed in approximately four to six months. Chapter 13, on the other hand, involves a repayment plan that runs for three to five years. It’s a personal reorganization (similar to a business Chapter 11) that allows for an opportunity to catch up on secured debts, most often chosen if you are behind on a secured loan (like for your house or car) that you want to keep. Chapter 13 is generally more complex because of the repayment requirement and overall length of the case. If you are dealing with primarily (or only) unsecured debts like credit cards and medical bills, Chapter 7 may be the best fit. Most times, your circumstances will help you decide between the two chapters. If, after you have thought through your options, you decide that Chapter 7 is the best solution for you, Upsolve can help guide you through the process, step by step, with our Tennessee Bankruptcy Guide.
Jackson Bankruptcy Lawyers - Estimated Cost
It’s not at all uncommon to consult an attorney when you are exploring your bankruptcy options. Many lawyers who practice bankruptcy in Jackson offer free initial consultations so you can meet with them to talk about your circumstances without an immediate commitment. This can also be very useful to help confirm that you are on the right track with considering bankruptcy and whether you are planning to file the best chapter for your situation. Upsolve can help you find a lawyer to help with your Jackson bankruptcy. If you do decide to hire an attorney for your case the typical Jackson bankruptcy lawyer cost will run between $1,100 and $1,200.
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How to File Bankruptcy in Jackson, Tennessee for Free
If your situation allows you to file a straightforward Chapter 7 bankruptcy in Jackson, it’s possible to do so for no or little money. Upsolve can partner with you and will walk you through the process of filing bankruptcy in Jackson, beginning with these 10 steps.
Collect Your Jackson Bankruptcy Documents
There are many documents you will need to gather to show that you are eligible for Chapter 7 bankruptcy in Jackson and to fill out your paperwork. You will need documents to verify your identity, such as a driver’s license or Tennessee ID, and government-issued proof of your social security number, like your social security card. You will need to show proof of your income for at least the last two months (although six is better) and your federal and State income tax returns for the past two years. You’ll also need documents regarding any financial accounts like bank accounts you may have etc. You also need documentation for your home if you own rather than rent (including mortgage statements, property tax statement, any back water bills, and proof of insurance) and your car (title, most recent statement on any loan on the vehicle, and proof of insurance.) You will be listing all of your possessions (assets) and all of your debts (liabilities.) For assistance with liabilities, you should obtain a free copy of your credit report to make sure that you are listing all of your creditors and their proper addresses when filing bankruptcy in Jackson.
Take Credit Counseling
The next step before you are ready to file your Chapter 7 bankruptcy in Jackson is to take your first required credit counseling course. There are two courses to complete before and after filing bankruptcy in Jackson. You will need to do so through an agency approved for the Western District of Tennessee for each one of the courses, and many agencies will let you sign up and pay for both at the same time, usually for around $50. Many agencies offer online or phone options to complete these courses. If you prefer to take the courses in person you may be able to do so at The University of Tennessee Extension for Madison County.
Complete the Bankruptcy Forms
After finishing your first credit counseling course you can turn to completing your Jackson bankruptcy forms. If you are working with an attorney, they will complete the forms on your behalf. If you are representing yourself, you can do this with Upsolve by completing an online questionnaire that will populate your forms needed to file a Chapter 7 bankruptcy in Jackson. Additionally, the Western District of Tennessee offers resources for debtors who are pro se (representing themselves.) There are no specific local forms for the Western District, but you will still need to fill out and complete all of the federal forms (over twenty forms in total) for your Tennessee bankruptcy.
Get Your Filing Fee
The next step to complete is getting your Tennessee bankruptcy filing fee together. The filing fee for a Chapter 7 bankruptcy in Jackson is $335 and it’s due at the time you file your case. This payment can only be made in cash or certified funds like a cashier’s check. If you are unable to afford the fee and you earn less than 150% of the federal poverty guidelines you can request a fee waiver. Even if you don’t qualify for a fee waiver you can request to pay the filing fee in installments instead. Just note that the fee must be paid in full in no more than four payments and within 120 days from filing bankruptcy in Jackson.
Print Your Bankruptcy Forms
After filling out your Jackson bankruptcy forms you will need to print them out to file them with the Court. Make certain to print them with only one on a page (not front and back) as the Court will not accept double-sided paperwork. If you have access to a printer at home or work, it’s also a good idea to print an additional copy for your records. If you do not have access to a private printer you can check out the Jackson Madison County Library for reasonable printing rates or try the local Office Max to use their printing services.
Go to Court to File Your Forms
At this point in the process, you are ready to officially file your Chapter 7 bankruptcy in Jackson and begin your case. You will need to file your Tennessee bankruptcy paperwork at the Eastern Division location of the United States Bankruptcy Court Western District of Tennessee, located at 111 South Highland Avenue, Suite 107, Jackson, TN 38301. It’s generally best to plan to file your bankruptcy in person in case there is an easily correctable issue, like a missing signature. Be certain to check the Eastern Division office hours in advance of planning your trip because it can differ depending on the time of the month, and bring along the filing fee and certificate of completion from your first credit counseling course. Generally, the office is open from 8:30 am to 4:00 pm daily on weekdays but the last Monday of the month it’s 9:00 am to 4:00 pm instead. Additionally, they close the public counter daily from 12:30 pm to 1:00 pm so be mindful of that if you are planning on filing bankruptcy in Jackson during your lunch break.
Mail Documents to Your Trustee
After filing your Chapter 7 bankruptcy in Jackson, you will need to provide documents to your bankruptcy Trustee in advance of your creditors’ meeting. Generally you can expect to receive a communication from your Trustee detailing exactly which documents are required, but it’s safe to assume you will need proof of your income for the past sixty days, tax returns (federal and Tennessee) for the past two years, your most recent financial statements from any accounts, any and all paperwork related to your home as well as any paperwork for your car. These documents must be received by the Trustee at least seven days before your Meeting of Creditors, so if more than two weeks have passed since you filed your Tennessee bankruptcy with the Court, you should contact your Trustee directly to make certain you are providing the correct information in a timely manner.
Take Bankruptcy Course 2
As discussed earlier, there are two required credit counseling courses when filing bankruptcy in Jackson. It’s a good idea to complete your second required course before your creditors’ meeting to avoid missing any deadlines in your Tennessee bankruptcy. You can use the same agency you did for the first course, as long as they are approved to offer the second one too. It’s important to note that you need to file this certificate of completion with the Court so that it is reflected in your Tennessee Bankruptcy Court record. It’s not enough to simply hand it to the Trustee.
Attend Your 341 Meeting
The next step for your Chapter 7 bankruptcy in Jackson is to attend your Meeting of Creditors. This meeting will take place before your bankruptcy Trustee and tends to be fairly brief. You will need to bring your proof of identity and social security number to provide to the Trustee. If you are anxious about this appearance you can learn more about how to prepare, so you’re not as nervous the day of the meeting. The Trustee will ask you questions regarding the information you provided in your bankruptcy forms as well as the documents you sent to their office after filing bankruptcy in Jackson. The questions are generally asked to verify that the information provided in your bankruptcy forms is true and accurate. There is also an opportunity for your creditors to appear and ask questions, although that tends to only happen if it’s a lender for a car loan that you intend to keep. In that case, they may appear to confirm that you do intend to keep the vehicle and sign a reaffirmation agreement to maintain the payments.
Dealing with Your Car
Speaking of cars, if you do own one you may need to decide whether to keep it before you file your Jackson bankruptcy. Your decision will depend on several factors. If you are making payments on your car, the first issue to resolve is whether you are current on the payments. If you are not, a Chapter 7 bankruptcy in Jackson will not offer an opportunity to catch up on payments. People who file bankruptcy in Jackson while behind on car payments, have likely decided to surrender the vehicle and walk away from the debt. The bonus in this scenario is that you can also walk away from any missed payments and late fees. If you’re current on the payments, you can still decide to surrender the car. That makes sense if it’s worth significantly less than what you owe on it or you’re worried that the monthly payments may be too much. You can determine the value of the car by starting with the fair market value according to Kelley Blue Book or NADA for the make, model, year and condition of the car. From there you should subtract the balance of any loan payment(s) to determine the equity. If it’s worth less than you owe you can explore a redemption with the lender (where you pay for the value of the car instead of what you owe.) If you are current and wish to keep the car you might decide to enter into a reaffirmation agreement, just be sure to confirm that you can protect the equity with your bankruptcy exemptions.
Tennessee Bankruptcy Means Test, Bankruptcy Forms, and Exemptions for Jackson
Tennessee Means Test
Before filing bankruptcy in Jackson you will need to show that you are qualified to file a Chapter 7 case by passing the Tennessee bankruptcy Means Test. You can pass the Means Test in one of two ways; first, you can qualify with income limits if your monthly income is less than the median income in Tennessee. Second, you can go through the extended Means Test analysis to show that you have little or no disposable income at the end of the month after paying your reasonable expenses.
Median Income Levels for Tennessee
Tennessee Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
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Poverty Levels for Tennessee
Tennessee Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
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Tennesse Bankruptcy Forms
Filing for bankruptcy usually involves filling out a mix of federal and local forms. When filing your Tennessee bankruptcy forms for your Chapter 7 bankruptcy in Jackson, however, you will only need to complete and file the federal forms as there are no specific local forms required for the Western District of Tennessee. You will only need one copy of your forms to file, however, if it’s not a hardship, print a second copy of everything for your records as that can be helpful.
Exemptions can be used in bankruptcy to protect your possessions. Every state has the choice of whether to allow their residents filing bankruptcy to choose between the federal bankruptcy exemptions and state exemptions. Tennessee is an “opt-out” state, meaning that anyone who files bankruptcy in Tennessee (including a Chapter 7 bankruptcy in Jackson) is limited to only using the Tennessee bankruptcy exemptions.