Bankruptcy is not something to be taken lightly. Georgia consistently has one of the highest bankruptcy rates in the nation. The reasons are debatable, however, the seriousness of the financial status of millions of Georgians is not! More frequent than many people realize, the bankruptcy rate in our state remains high.
When all other mitigation steps have been taken, engaging in the bankruptcy filing process in Georgia may be a viable option. The bankruptcy filing process in Georgia requires the following considerations as per the 2005 Bankruptcy Act:
- Credit Counseling
- Georgia Means Test
- Gathering of Documents to File
The Bankruptcy Act of 2005 states all individual debtors who file bankruptcy on or after October 17, 2005, must undergo credit counseling within six months prior to filing for bankruptcy relief and to complete a financial management instructional course after filing bankruptcy. The bankruptcy filing process in Georgia is no different. Proper financial counseling is necessary to make certain filing for bankruptcy is indeed the right step towards improving an individual’s negative financial situation.
Georgia Means Test
Second, the Georgia Means Test is designed to analyze an individual’s income and expenses to determine bankruptcy qualification under Chapter 7 or Chapter 13. Chapter 13 of the Bankruptcy Code provides for adjustment of debts of an individual with steady income. It also allows a debtor to retain their property and pay debts over time, normally three to five years.
A chapter 13 bankruptcy is often termed a wage earner’s plan. Chapter 7 of the Bankruptcy Code allows debtors to rid themselves of most debts and start over with a clean slate. However, drawbacks include the loss of property and a depressed consumer credit score. Chapter 7, also called liquidation or straight bankruptcy, is the process by which a debtor’s assets are sold, creditors receive payment, and you are then free from your debts.
The bankruptcy filing process in Georgia Means Test consists of the courts comparing 6 months of an individual’s income to the state median income. If below the Georgia median income, the process for filing Chapter 7 can be followed. Otherwise, the remainder of the test will determine whether an individual may file for Chapter 7 or must file for Chapter 13.
Gathering of Documents to File
Once the proper Chapter of the Bankruptcy Code has been determined, the bankruptcy filing process in Georgia requires residents to gather all the required documentation necessary to file to include: income statements; listings of major financial transactions over the past two years; monthly living expenses; debts, and property assets and possessions. Sufficient documentation supporting one’s negative financial situation is key when filing for bankruptcy.
If you find yourself in need of advice on how to file for bankruptcy in the State of Georgia, Galler Law Firm bankruptcy attorneys, with over 30 years of experience helping Georgia residents get a renewed and fresh financial start, stands prepared to assist. We are the attorneys at law to call boasting a 99% success rate in discharging all Chapter 7 bankruptcy cases. We are available 24 hours a day, seven days a week to answer or return your call.