There are a number of misconceptions associated with filing for bankruptcy. Many South Carolina residents may be concerned that they will lose everything by filing. Or, perhaps they believe that all of their friends and relatives will discover that they filed. In reality, it is unlikely that friends or family will be aware unless the individual chooses to disclose the information, and more than likely, he or she will be able to keep most if not all of his or her possessions.
Under Chapter 7 bankruptcy, the majority of the individual’s debts can be discharged. While it is possible that some assets will be sold to pay some of the debt, many assets are considered exempt. This means that the individual will be able to retain these assets unless they are currently financed and are being included as a part of the bankruptcy. It may be possible to reaffirm debts such as a car loan or mortgage so that these debts are not included in the bankruptcy.
Under Chapter 13 bankruptcy, a three to five-year repayment plan is proposed for the court’s approval, based upon the individual’s repayment capability. At the end of this time period, the majority of remaining debts are discharged. Some debts such as child support, alimony, most taxes and student loans, however, are not eligible for discharge.
The decision to file for bankruptcy can be life-changing. Rather than struggle to pay bills and wonder how everything will get taken care of, the South Carolina resident is granted a fresh start. An experienced attorney can assist in determining if this the appropriate option.
Source: USA Today, “Thinking of filing for personal bankruptcy? Here is how it works”, Judith Ohikuare, May 5, 2018
