Hawaii Bankruptcy Laws for Those Struggling with Debts
Mar 22nd, 2011 by GuestPoster
If you are struggling to pay your obligations, an option is to file for bankruptcy. Bankruptcy will not get rid of all your debts and you will still be responsible for alimony, child support, student loans, you’re most recent back taxes, payment for purchases of more than $550 purchased within 90 days of filing, fraudulent debts, cash advances of $825 or more within 70 days of filing, and fines or penalties imposed by government agencies.
The Hawaii bankruptcy laws allow the consumer to file for bankruptcy under Straight Bankruptcy or Chapter 7 which wipe out all debts except those listed above to give the consumer a fresh start, or a Wage Earner Bankruptcy under Chapter 13 which allows the filer to draw up a repayment plan over several years to pay his debts.
Liquidation is the other term for Chapter 7. It is available to individuals, partnerships, married couples and corporations and is a simple and quick way to apply for bankruptcy. Your non-exempt property is gathered by a court-appointed trustee who sells the property and pays your creditors from the proceeds. It is possible that there will be no property to gather and sell as chapter 7 cases are usually no-asset cases.
A means test provided under the Federal bankruptcy laws will determine your eligibility to file for a Chapter 7 bankruptcy. You will be eligible under Chapter 7 if your income is below the family median income in your state according to the The State Meridian Family Income by Family Size data. The test is meant to limit eligibility for Chapter 7 filing to those who are not really capable to repay their debts.
You will have to file under Chapter 13 bankruptcy if you don’t qualify for Chapter 7 bankruptcy. Your monthly average income less your mortgage and car payments and some necessary expenses is your monthly disposable income. Your disposable monthly income will be multiplied by 60 and this will be the amount you will be able to pay over 5 years.
You need to consult your Hawaii bankruptcy lawyer for immediate and sound advice on your debt problems.
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