Expenses To Pay Before Declaring Bankruptcy In Henderson, NV

If you’re considering filing for bankruptcy in Henderson, Nevada, you probably want to hold on to every dollar possible. With the cost of living reaching new heights, most bills nowadays are significant amounts that could be spent on other expenses. While preparing for bankruptcy, you might stop paying certain expenses to make every dollar count. It’s crucial that you understand the effects of stopping payment on each type of expense so that you don’t experience negative consequences like asset repossession, delays in your bankruptcy case, and more. This is just one of the ways that hiring a quality bankruptcy firm to handle your case can come in handy. Our Henderson bankruptcy team is experienced in helping Nevada residents with debt that is outside of their control achieve positive outcomes given their situations. To get started with your free consultation by phone, call 702-899-3328.

Housing Expenses: Your mortgage or rent likely represent the largest expense in your monthly budget. It is generally advisable to continue paying a home mortgage while preparing for bankruptcy, if you can. Filing for chapter 13 bankruptcy will create a payment plan that includes your mortgage and any balance in arrears. But filing for chapter 7 bankruptcy won’t clear or pay off a secured debt, including a home mortgage. Your lender can even petition the court for Relief from the Automatic Stay while your automatic stay is still active to proceed with a home foreclosure. If you rent, a bankruptcy filing will stop an eviction that hasn’t proceeded to the writ phase.
Utilities: Your electric company can’t shut your power off while your bankruptcy is active for failure to pay your bills. But they can do so before your petition is filed, and they can refuse to continue providing service if you discharge their bill without repayment. You won’t always have a choice in who is your utilities provider- for example, if you move to a new apartment complex, you might only have one choice in home internet and electricity. Here, you might have to repay your balance to the utilities company so that they can resume service. Keep paying your utilities while preparing for bankruptcy, especially those you intend to keep using during and after your case.
Child Support: Child support is a unique expense and debt for several reasons. A child support wage garnishment has a much higher legal maximum than other types of debt. Most debts have a wage garnishment limit of 25%, but wages can be garnished for back child support at a rate of up to 65% in Nevada. Back child support can be pursued aggressively- a parent who fails to pay child support can lose their driver’s license, passport, or even be jailed. Filing chapter 7 bankruptcy won’t discharge back child support or stop a child support wage garnishment. Only a chapter 13 bankruptcy that will fully pay off child support arrearages can stop a child support wage garnishment. Therefore, you should continue paying your child support, or as much as you can, while preparing for your bankruptcy.
Student Loans: It is extremely difficult to have student loans discharged by a bankruptcy filing. If your wages are being garnished for your student loans, you might not have any choice in whether or not you will continue making payments while preparing for bankruptcy. Unlike child support, even though bankruptcy won’t discharge student loans, the automatic stay will stop a student loan wage garnishment. However, the garnishment can resume after your case has been discharged if your loans aren’t paid off in the meantime.
Car Loan: Your car loan is a secured debt, so like a mortgage, you need to keep paying if you wish to keep the asset. Vehicle repossessions can proceed much faster than home foreclosures, so missing just one payment could result in you losing your vehicle before getting your petition filed and activating the automatic stay. If your vehicle has become a financial burden, bankruptcy is also an opportunity to surrender the vehicle and wipe away any fees and debts that this would typically create. Depending on your situation, you might be able to finance a car with better value and a better interest rate shortly after your case has been filed.
Repossession Deficiency: If any of your assets are repossessed, including a home foreclosure, you could be left with a debt known as a “repossession deficiency” despite already losing an asset on which you have made significant payments. When an asset is repossessed, it is generally sold at auction. The creditor can tack on interest and legal fees onto the loan’s balance. If the vehicle sells for less than that total balance, that becomes the repossession deficiency. Because the secured asset has already been repossessed under these circumstances, it is an unsecured debt. Unsecured debts are the simplest type of debt to discharge in bankruptcy, so you can prioritize this bill low on your list if you know that you will soon be filing.
Credit Cards: Credit cards are one of the simplest debts to wipe out with a bankruptcy filing. Paying off a debt that you know will be erased in an upcoming bankruptcy filing probably isn’t the best way to spend your money. Unless special circumstances are present, you can focus your income on secured debts, priority debts, and other expenses that won’t be erased by filing for bankruptcy. However, you should also be sure not to exceed pre-bankruptcy credit card spending limits: avoid luxury purchases of $800 or more in the 90 days before filing, and cash advances of $1,100 or more in the 70 days before filing. If you have any questions about this issue, contact our Henderson Bankruptcy Attorneys at 702-899-3328.
Subscriptions: Most subscriptions will not continue providing a service once you miss one payment, so it is difficult to accrue a considerable debt from this type of source. However, you might want to make note of which of your subscriptions are paid with your credit cards. Your credit cards will be closed out when you file your bankruptcy petition, which could interfere with your monthly payments on subscriptions you wish to keep. But if you have subscriptions you’ve been meaning to cancel and they are through credit cards you will lose in bankruptcy, this is a chance to reduce your monthly budget without extra effort.

Review Your Situation In Detail With An Experienced Henderson Bankruptcy Lawyer

Determining which expenses you should continue paying while preparing for bankruptcy is just one of the tasks that can be completed more easily with the support of a skilled Henderson bankruptcy lawyer. Our firm strives to be the top choice for residents of Henderson considering their debt relief options. At the Law Office of Erik Severino, we know what it takes to get a bankruptcy case filed quickly and accurately in Nevada. We can guide you through each step of the process with confidence and efficiency so you can rest easy knowing that your case is in good hands. You may even be eligible for one of our low-cost filing plans, allowing you to file with no money down and make affordable installments after your petition has been filed. To get started today with your free phone consultation, call 702-899-3328. Don´t hesitate to contact us today!