Delaware Bankruptcy Laws should be known by every resident of the state of Delaware. If you are a Delaware resident struggling to keep up with your monthly payments and bills, you would want to have an alternative to end this predicament. One of the many alternatives is bankruptcy protection. Every Delaware citizen is entitled to this right. Prior to making the final decision to file for bankruptcy, you should familiarize the Delaware bankruptcy laws to help you understand what your rights are.
Bankruptcy jurisdiction is a federal matter, therefore federal laws apply. Aside from these laws, each state has specific bankruptcy laws that supersede federal laws. These differences include the filing process, fees due during petition processing, state-defined exemptions, and of course, the qualifications for bankruptcy based on the mean income level of each state. One of the primary things you should do when contemplating bankruptcy application is hire a lawyer. Not only will this lawyer advise you if bankruptcy is the right choice, he will also assist you in filing for bankruptcy should you decide to avail of it.
In the state of Delaware, a citizen is offered two choices. A Chapter 7 bankruptcy is probably the most common and easiest way out of accumulating credit card debts. Before you can avail of Chapter 7, you will undergo a series of assessments to be conducted by the trustee. This is called “means test” where your income will be measured against the median income of state of Delaware for the current year. Your income should be less than what most citizens earn as published by the Census Bureau. If you won’t pass this test, there is another way you can avail of this bankruptcy form. You can request the trustee to evaluate your income for the past 6 months next to the monthly expenses and bills. Once these have been validated and the total amount won’t be enough to pay your creditors monthly, then you can file for Chapter 7.
On the other hand, if your income will allow up to $6,000 to pay your debtors within a 5-year period, you will have to file for the Chapter 13 restructuring program. This type of bankruptcy will help the debtor pay his creditors by proposing a restructuring plan. With the help of your trustee, a repayment plan should be proposed outlining the scheme on how to pay your creditors, together with all the creditors’ information and the debt details. This should be approved by the court, monthly payments should be given to the trustee, and the trustee in turn, distributes the payments to the creditors based on priority structure.
When it comes to the exemptions or assets that are protected by the laws, the debtor may either choose between the federal exemptions or the state-specific exemptions. Delaware bankruptcy laws specify the following exemptions:
• Real-estate property of up to $50,000;
• Any vehicle used for employment up to $15,000;
• Any tool of trade up to $15,000;
• Personal belongings like clothing, books, library items, family albums and pictures, and burial plots;
• Other personal property amounting to $500; and
• Compensation payments, retirement plans, insurance, and public assistance.
Bankruptcy declaration will help both debtors and creditors in the long run. The debtor will be rid of massive amounts of debts, while the creditor will get paid. It is important to seek the advice of your lawyer when you file for bankruptcy. Anything you don’t understand will all be explained by your lawyer for a much clearer picture of what to expect.