North Carolina Bankruptcy Laws should be known by every resident of the state of North Carolina. Generally, North Carolina bankruptcy laws have much in common with other bankruptcy laws of other states across the country. However, each state has its unique sets of rules that apply to the exemptions, filing fees and methods, as well as the census data where you monthly income will be compared with. For every citizen who is on the brink of a creditor’s foreclosure, there is no other option left but to avail of the right for bankruptcy protection.
The bankruptcy process has a lot of complexities involved, a basic knowledge of the bankruptcy process will prove to be a debtor’s advantage. However, a lawyer’s services should be employed to help you go through the whole process successfully. A licensed lawyer allowed to operate in North Carolina and one who specializes in bankruptcy cases is a necessity. Most importantly it is the essential that you ask your lawyer what bankruptcy protection suits your needs.
The most availed bankruptcy type and common to most citizens is Chapter 7 or liquidation bankruptcy. For this type of bankruptcy you are given the chance to start anew by liquidating all your dischargeable debts. These debts include credit card debts, tax debt, mortgage deficiency, and other kinds of debts.
The trustee assigned to your case will handle the bankruptcy proceedings. It is the responsibility of the trustee to liquidate non-exempt assets. The proceeds of which will be paid to the creditors according to the priority list established by the bankruptcy courts. You can do avail of this opportunity only if you pass the stringent criteria for Chapter 7 bankruptcy. There is no assurance that even if you are suffering from insurmountable debts you will qualify for this type.
Another type of bankruptcy protection that’s ideal for regular income earners and those who want to protect their assets that are not safe is Chapter 13. This program is called the debt restructuring program because the terms of your debts will undergo reorganization in such a way that you can pay your debts in a time period of 3 to 5 years. This is called a repayment plan developed by the debtor and approved by the bankruptcy court, to be implemented by the trustee arbitrarily chosen by the court. The monthly payment funds should be given to the trustee so that it can be paid to your creditors. An automatic stay is given to the creditors to prevent them from taking any legal action, foreclosure, or repossession while you are still complying with the payment plan. Although this bankruptcy protection does not offer an instant respite from your debts, it helps you pay all debts without sacrificing any of your possessions.
North Carolina bankruptcy laws have defined a number of assets included in the exemptions list. This list comprises assets that are safeguarded from your creditors during bankruptcy processing. Some of the most important assets in the list include:
• Homestead exemption of $18,500;
• A vehicle worth $3,500;
• Tools of trade worth $2,000;
• Personal belongings like furniture, books, clothing, crops, and animals amounting to $5,000; and
• Other personal benefits like employee pensions, death compensation, life insurance proceeds and prescription health aids.
Before you can start the formal application of bankruptcy protection, it is required by the federal and state laws that every debtor should attend a comprehensive credit counseling program 180 days before said application. This goes to show that bankruptcy is a serious matter you need to think about.