There are many roads that can lead to financial distress.  Have you experienced a job loss?  Have health problems led to exorbitant, and uncovered, medical bills?  Have financial decisions you have made blown up in your face?  There are several roads that can lead to financial recovery, some better than others.   There is not one universal solution that guides everyone to financial recovery, as financial problems can be as diverse as the individuals suffering from them.  At Hayward, Parker & O’Leary, Esqs., experienced Middletown NY bankruptcy lawyer Michael O’Leary, Esq. offers a free Initial Consultation with prospective clients to explore financial recovery options, one of which is bankruptcy.

The Bankruptcy Option

For many people the correct path to financial recovery does involve a bankruptcy filing, under either Chapter 7 or Chapter 13.  Unlike the Wild-West aura of out-of-court debt negotiations, the bankruptcy process is highly structured and specifically designed for the honest debtor to receive the debt relief they so desperately need.

Chapter 7 is typically most appropriate for people burdened with unsecured debt, such as credit cards, medical debt and personal loans where no collateral is posted.  Old income tax debt can often be discharged as well.   To qualify for Chapter 7 relief one must “pass” the Means Test, which is largely based on your average monthly income for the prior 6 months, from which certain expenses are deducted.  Chapter 7 is a “liquidation” proceeding that involves a “trade off”.  In return for obtaining a Discharge of your debts your non-exempt assets can be liquidated by a Chapter 7 Trustee, with the liquidation proceeds used to repay one’s creditors.  At the Initial Consultation experienced bankruptcy lawyer Middletown NY Michael O’Leary will analyze your assets in detail to determine which assets, if any, could potentially be liquidated in a Chapter 7 case.  In most Chapter 7 filings there is nothing for the Trustee to liquidate, as many assets are exempt from liquidation.

Chapter 13, on the other hand, is a long-term (3 to 5 years) repayment plan generally filed:

• To save a home from foreclosure;
• To protect assets that a debtor would lose if a Chapter 7 liquidation case were filed; and
• When the debtor is not eligible to file for Chapter 7 relief, usually due to the client “failing” the Means Test or having filed a prior Chapter 7 case within the past 8 years, for which a Discharge was received.

No assets are liquidated by a Chapter 13 Trustee, who is essentially a disbursing agent only.  The Chapter 13 debtor makes a monthly Plan payment to the Chapter 13 Trustee, with the required monthly payment amount largely determined by the amount of disposable income left over in debtor’s budget at the end of the month.   The Chapter 13 Trustee then disburses the funds received to your creditors according to certain requirements, both statutory and those set forth in the Chapter 13 Plan.

Alternatives to Bankruptcy 

The most common bankruptcy alternative circulating these days is Debt Settlement.  Companies offering these services generally advertise on late night cable TV channels, usually displaying the American flag and the word “Freedom” in their ads.  This option can certainly be discussed with a prospective client, but bankruptcy attorney Michael O’Leary strongly feels that their business model is so fundamentally flawed that there are very few people who benefit from their services

Benefits of Hiring a Local Bankruptcy Lawyer

Middletown NY bankruptcy lawyer Michael O’Leary will assess both your financial and personal circumstances, make a recommendation as to which bankruptcy option (if any) is most appropriate and right for you and will guide you through the bankruptcy process every step of the way.  Through regular personal dealings with the client, experienced Bankruptcy Attorney Michael O’Leary can effectively handle your case in a timely manner, whereas an attorney operating from a distant location, relying solely on electronic communications such as email and Zoom, can be severely hampered by the limitations inherent in non-personal communications.

Calling 845-343-6227 to schedule a free consultation with experienced bankruptcy lawyer Michael O’Leary can be your first step toward achieving debt relief and financial recovery.