Understanding Your Oklahoma Bankruptcy Options

When suffering from an overwhelming amount of debt, many begin to consider filing for bankruptcy. It’s a legal way to handle financial problems when put in a situation where you can no longer pay back money you owe to creditors by helping you clear or manage debts under the protection of a federal court. Most bankruptcy options in the United States are controlled by federal law, and Oklahoma bankruptcy options are no different. There are two common bankruptcy types for individuals in Oklahoma: Chapter 7 and Chapter 13. Both types have their own requirements and are each different in the needs that they meet.

Fresh Start Bankruptcy

Chapter 7 bankruptcy is usually the better option for those who need a quick way to eliminate unsecured debts such as credit card debt or medical bills. In Chapter 7, a trustee executes sales of your non-exempt assets in order to pay off the creditors you are in debt to. It’s important to note that while Chapter 7 helps remove many types of debts, you might have to give up some of your property.

In Oklahoma, you can choose to take either state exemptions or federal exemptions to protect your assets. Oklahoma’s typically allow you to keep primary assets like your home and car, as long as their value is within certain limits. For example, your home’s equity must not exceed a certain amount, and your vehicle’s equity is limited at a different amount.

Consolidating You Debt

If you have a consistent income and want to keep your property, filing for Chapter 13 bankruptcy could be a more fitting option. This allows you to reorganize and pay debts over three to five years through the use of a payment plan. After the completion of this plan, the courts can discharge your remaining unsecured debt.

Chapter 13 is especially useful to those who are behind on a mortgage or car loan and want to avoid foreclosure or repossession. This method lets you slowly catch up on your missed payments as you continue to make current payments when they’re due.

Filing for Bankruptcy in Oklahoma

Going through your options for filing bankruptcy in Oklahoma involves several different tasks that you must complete. First, you must gather the documents that show your income, debts, and transactions. Next, attend credit counseling within six months before filing your petition. When you file, you must provide your financial records, a list of all assets and liabilities, a breakdown of your living expenses, income, and a certificate of credit counseling. The court appoints a trustee to handle your case, who is then tasked to review your assets and debts.

341 Meeting

After filing for bankruptcy, there will be a meeting of creditors, known as the 341 meeting. During this meeting, the trustee and creditors have the chance to ask you about information filed in your petition. All questions will be answered under oath. This meeting allows for everyone involved to get a grasp of the situation, which is essential for the bankruptcy process. This meeting is typically simple but helps to clarify any concerns regarding the execution of the bankruptcy plan.

Financial Growth After Bankruptcy

Bankruptcy can stay on your credit report for up to ten years. However, many people are able to start recovering their credit scores much sooner than this. By budgeting and gradually building up your credit again, you can financially recover. You can even buy a house again shortly after filing if you do the right things. These actions help demonstrate to creditors that you are improving your financial management, which can positively affect your credit score. Ultimately, you can significantly mitigate the long-term impacts of bankruptcy and pursue future financial stability.

The Costs of Bankruptcy

There are also costs involved in the process of filing for bankruptcy. For Chapter 7, there is a filing fee, administrative fee, and a trustee surcharge. Chapter 13 fees are generally higher. You must also pay for mandatory credit counseling and financial management courses. While these fees can be discouraging, they are a part of the process that can help lead to financial stability.

Bankruptcy Attorneys Near You

While options for bankruptcy can provide relief to those with financial struggles, consider all aspects before deciding to file in Oklahoma. Each type has different short and long term benefits, risks, and consequences. Understanding the specifics of your options can help you decide what’s best for your financial situation. While there are many confusing aspects when it comes to filing for bankruptcy, a bankruptcy attorney can provide you with clarification and guidance through the bankruptcy process, ensuring you make the right choices for your situation. If you’re considering bankruptcy, contact a Tulsa bankruptcy attorney at Kania Law Office call us at 918.743.2233. Or, click this link to ask an online legal question.