A bankruptcy attorney in Philadelphia may recommend filing for bankruptcy if you feel overwhelmed by debt and are looking for a fresh start. Depending on the type of debt you possess, after you complete your bankruptcy case all or most of your debt may be erased. However, before filing for bankruptcy, discuss your financial situation with a bankruptcy attorney in Philadelphia. A bankruptcy attorney in Philadelphia will examine your financial situation and help you decide whether filing for bankruptcy is right for you.

If you and your bankruptcy attorney in Philadelphia decide that filing for bankruptcy is right for you, your bankruptcy attorney may recommend that you file for either Chapter 7 or Chapter 13 bankruptcy. Your attorney may choose which bankruptcy you should file based upon your goals and whether you are eligible for both types of bankruptcy. For example, if you do not have a significant number of assets that you would like to keep, your bankruptcy attorney in Philadelphia may recommend that you file for Chapter 7 bankruptcy. However, to be eligible to file for Chapter 7 bankruptcy in Pennsylvania after the changes to the Bankruptcy Code in 2005, you must either earn less than the median income for the state of Pennsylvania, or satisfy the means test. For example, as of  2011 the median income for the state of Pennsylvania is $45,092 for a single individual.

However, if you have regular and reliable income for at least 6 months prior to filing for bankruptcy and you would like to keep your assets, your bankruptcy attorney in Philadelphia may recommend that you file for Chapter 13 bankruptcy. Regular and reliable income is important when determining your eligibility for Chapter 13 bankruptcy because you will develop a repayment plan for your Chapter 13 bankruptcy. The income can come from any source including child support payments or a pension. Prior to filing for bankruptcy, your bankruptcy attorney in Philadelphia will help you develop your Chapter 13 repayment plan. Most repayment plans last 3 to 5 years.  However, the bankruptcy court must approve the plan before you begin to make payments toward the plan. After you obtain approval, you will make monthly payments to your Chapter 13 bankruptcy trustee. Then, the bankruptcy trustee will disperse the funds to your creditors that are included as part of your Chapter 13 plan.

Bankruptcy Discharge
A bankruptcy discharge means that the law no longer recognizes the debts included as part of your bankruptcy case, and the debts are erased. However, you will not receive a bankruptcy discharge until your bankruptcy case is complete. In a Chapter 7 bankruptcy, a bankruptcy discharge usually occurs about 3 to 4 months from the date you filed your initial bankruptcy petition. However, in a Chapter 13 bankruptcy, the court will not grant a bankruptcy discharge until you complete the repayment plan.

Filing for bankruptcy can be a confusing process, and you may have many questions about the bankruptcy procedure. Therefore, contact a bankruptcy attorney in Philadelphia to answer any questions you have and to help you determine if filing for bankruptcy is the right decision for you, or visit the Eastern District of Pennsylvania’s website http://www.paeb.uscourts.gov/. If you are considering filing for bankruptcy without the assistance of an attorney, visit http://www.uscourts.gov/FederalCourts/Bankruptcy/BankruptcyResources/FilingBankruptcyWithoutAttorney.aspx for additional information regarding how to file for bankruptcy on your own.