Are you searching for answers to solve your financial challenges? Looking for some clarity on how Illinois bankruptcy laws can affect your financial situation? Bankruptcy is a charged subject to begin with, so to avoid the confusion and frustration that come when you mix debt stress and complex legal jargon, we're going to take a look at how Illinois bankruptcy laws can help get you a fresh start.
The key to understanding what bankruptcy can do for you is to break things down simply.
Chapter 7 Bankruptcy laws Chapter 13 Bankruptcy laws are quite different. Chapter 7 liquidates some of your assets to pay creditors, leaving you debt free in 3-6 months. Chapter 13 puts you on an affordable interest-free payment plan that allows you to be debt-free in about 3-5 years. Both are quite effective, though your credit may take a long term (7-8 year) credit hit.
That's the basic overview. Now let's get specific to Illinois.
Unique Illinois Bankruptcy Laws You Must Know Before Filing
You'll need to take a credit counseling class. The courts don't want you right back in the system following a bankruptcy discharge. Thus, to qualify for a Chapter 7 or Chapter 13 bankruptcy, you need to complete a credit counseling course from an approved agency within the six months before you file. There is a typically a fee for the course, and you can choose to complete your counseling in person, over the telephone, or online.
To determine your eligibility, you'll need to pass the Illinois Means Test. To qualify for Chapter 7 or 13 Bankruptcy, you need to show both that you are under financial duress, and to what extent. Chapter 7 and Chapter 13 are specific programs for people with different financial challenges. Plus, there are different criteria for determining eligibility in Illinois that other states.
The means test requires that you input your average household income earned in the six months before the month in which you plan to file bankruptcy, in order to determine whether your income is above or below the median for a household of the same size in Illinois. If your household income is below the median, you stop there and are not required to fill out additional portions of the means test. Below-median debtors are eligible to file for Chapter 7 and, if filing under Chapter 13, can choose a three-year term to repay debt instead of five years.
If your income is above the median, you must provide more detailed information about your expenses and secured debt payments to determine whether you still qualify for Chapter 7 bankruptcy. Most Chapter 13 filers have to provide this information as well.
Illinois has a distinct set of exemptions. What should you expect to keep in a Bankruptcy filing in Illinois? See below and click here (/bankruptcy/filing-bankruptcy-illinois) for more:
- Illinois Homestead Exemption: The Homestead exemption refers to the house that you live in. You can use this exemption if you are filing for bankruptcy in Illinois to protect up to $15,000 in equity in your house per person. That means that a husband and wife filing for bankruptcy in Illinois could use this exemption to protect $30,000 total as long as they live in the house in question.
- Motor Vehicle Exemption: Bankruptcy filing law in Illinois protects $2,400 in value of any one motor vehicle listed in your U.S.. federal bankruptcy. Additionally, if you file the bankruptcy with a spouse it is possible to combine vehicle exemptions to protect up to $4,800 in vehicle equity as long as both parties are on the title to the car.
- Worker’s Compensation Illinois Exemption: Bankruptcy filing law in Illinois protects 100% of compensation you receive under Illinois workers' compensation laws. In Illinois, workers' compensation cases are 100% exempt. If you are injured while working, any compensation is money you deserve and creditors will be prevented from reaching those funds.
Getting Bankruptcy Help Can Save You, Big-time!
To get the best possible outcome in your bankruptcy filing, you need an experienced attorney who understands Illinois bankruptcy laws, Chapter 7 Bankruptcy laws, and Chapter 13 Bankruptcy laws through and through! David Chang of Suburban Legal Group was born in Chicago and raised in its surrounding suburbs. David began his legal career in Illinois in 2001, passing both the Illinois State Bar and the Northern District of Illinois Bar. He and the rest of the Suburban Legal Group team understand local bankruptcy law to the core.
Furthermore, our bankruptcy attorneys understand what you're going through and are sensitive your challenges and frustrations. To help, we offer Chapter 7 Bankruptcy and Chapter 13 Bankruptcy filing services to Chicago area residents at reasonable fees to help you through this difficult time in your life.
Our goal at Suburban Legal Group PC is to change your financial future.
Request a Free, No Obligation Bankruptcy Filing Consultation Today. There are no hidden fees, no obligations, no pressure and no risk in this consultation. Contact us today!
DISCLAIMER: All information on this website are provided for informational purposes only and are not intended to be construed as legal advice. Suburban Legal Group PC shall not be liable for any errors or inaccuracies contained herein, or any actions taken in reliance thereon.