While it may be a small state, the residents of Connecticut are still fraught with the same money problems that larger, neighboring states suffer from. You may want to dump your debt in the Connecticut River and watch it float away, but there is an easier way to get rid of your money trouble forever. A Chapter 7 bankruptcy has helped families and individuals all over the nation get rid of their financial issues, and it can help you as well.
There are multiple benefits for filing bankruptcy. As soon as you file, debt collectors will not be allowed to contact you, and must go through your attorney for communication. Judgments and garnishments are lifted, allowing you to once more access your accounts. Once your bankruptcy has been approved by the bankruptcy court, you will no longer have to worry about all the money you once owed.
Finding Your Way through a Forest of Bankruptcy Laws
How do you get started? The first and most crucial step is to find a qualified bankruptcy attorney. A Chapter 7 bankruptcy lawyer will help you through the entire process, from filling out paperwork and submitting the necessary documents (petition) with the court, to attending the short bankruptcy hearing you will be required to attend. After you have set up the initial meeting, you need to remember to bring the following documents:
- A complete list of your creditors and the debts that you currently owe
- Six months to a year of past pay stubs
- Last year’s filed tax return for you and your spouse
- Deeds and other relevant information regarding the property you own
- Information regarding all of your vehicles
- A list of your assets
Your attorney will use this information to determine if you qualify for a Chapter 7 bankruptcy.
How Do You Know if You Qualify for Chapter 7 Bankruptcy?
There are two ways to qualify for a Chapter 7 bankruptcy. The easiest way to determine if you meet the requirements is by examining your income. Every state has average income levels based on family size. If you fall at or below the income level for Connecticut then you may be to file for a Chapter 7. The income levels can change from year to year. Currently they are as follows:
- Single individual – $57,863
- Family of two - $71,961
- Family of three - $83, 655
- Family of four – $103,314
- Families larger than four – Debtors are required to add $7,500 per extra family member to the base income level.
If you exceed the income levels for Connecticut, there is still one other way to qualify. The means test is a mathematical procedure which was instituted by the Bankruptcy Reform Act of 2005. By supplying your financial information to your bankruptcy attorney, he can use the means test to see if your debts are excessive enough to qualify for bankruptcy. If they are not, you still may be able to file for a Chapter 13 bankruptcy. This type of bankruptcy roles all of your debt into a payment plan instead of discharging it all at once.
Debts You cannot Discharge
- There are a small number of debts that are non-dischargeable with any type of bankruptcy. They include:
- School loans
- Certain tax debts and liens
- Judgements and money owed from criminal charges
- Alimony or child support payments
Other debts, like credit cards, house payments, vehicle payments, personal loans, business loans, and numerous other types of debt can be discharged through a bankruptcy.
You will need to take two short debt education courses, one before you file, and one after you file your petition with the court. They last only about an hour and a half, and can be taken online or over the phone. Your bankruptcy attorney can recommend the best company that is certified with the bankruptcy court.
Once you petition has been filed, and after you attend a short bankruptcy hearing, your discharge should come in by mail in approximately 90 days. Your debts will be erased once you receive your discharge.
The Best Part? You Can Keep Your Home
Yes, you can get rid of nearly all of your debts, and keep most of your personal property including your home. All states have a certain amount and type of exemptions. In some states, including Connecticut, residents may additionally choose from federal exemption laws. This lets debtors to customize their exemption list, so they are able to keep the maximum of personal property. Although the exemption laws can change from year to year, some of the basic exemptions are listed below.
- Home exemption: Up to $75,000 in value is exempt for a primary residence.
- Household goods:
- 1 motor vehicle: $3,500
- 100% wedding rings
- 100% food, bedding and household furniture, including appliance
- 100% family burial plot
- 100% tools, books, pets, and farm animal
- Benefits and pensions:
- 100% Teachers', state employees' and city employees retirement benefits
- 100% Benefits under no-fault vehicle insurance law
- 100% Fraternal Benefit Society benefits
- 100% Benefits payable on account of sickness or infirmity
- 100% FEMA benefits exempt from garnishment
- 100% Military Survivor Benefit Plan annuities
- 100% ERISA benefits
- 100% Social Security benefits
- 100% Public safety officers' death benefits
- Other exemptions:
- 100% Vietnam veterans' bonus
- 100% Liquor permits
- 100% Crop insurance proceeds
- 100% Tenancies by the entireties
- 100% Unemployment compensation
- 100% Workers' compensation
- 100% Health and disability insurance payments
- 100% Necessary health aids
Check with your attorney to see which exemptions benefit you more. You may be able to retain more assets than you think. A skilled attorney will be able to find exemptions that may not look available. His/her counsel can be invaluable between what you will be able to save and what you have to give up.
Don’t float away on a pile of debt. Take charge of your finances today and get back to the life you have always dreamed of pursuing.
Connecticut Bankruptcy Court
Brien McMahon Federal Building and
United States Courthouse
915 LaFayette Boulevard
Bridgeport, Connecticut 06604-4706
Phone: (203) 579-5808
Abraham Ribicoff Federal Building and
United States Courthouse
450 Main Street
Hartford, Connecticut 06103-3022
Phone: (860) 240-3675
Connecticut Financial Center
157 Church Street, 18th Floor
New Haven, Connecticut 06510-2100
Phone: (203) 773-2009