Filing for Bankruptcy in Pennsylvania

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If you are overwhelmed by mounting debt and ready for a fresh start, consider filing for bankruptcy in Pennsylvania. If you file for bankruptcy in Pennsylvania, you may have the option of filing for either Chapter 7 or Chapter 13 bankruptcy. Depending on your situation and whether you are eligible for Chapter 7 or Chapter 13 bankruptcy, one over the other may be more accommodating to you.

Chapter 7 vs. Chapter 13
If you do not have many assets that you would like to keep following the bankruptcy and you do not have reliable income, filing for Chapter 7 bankruptcy in Pennsylvania may be the right option for you. However, you must be eligible to file for Chapter 7 bankruptcy in Pennsylvania. According to the Bankruptcy Code, you must earn less than the median income for the state of Pennsylvania, or you must have little disposable income. As of 2011, the median income in Pennsylvania is $45,092 for a single individual. If you earn more than the median income for the state of Pennsylvania, the bankruptcy trustee will evaluate your disposable income. Disposable income is the amount of income you have remaining each month after paying all necessary expenses like your rent and utilities. The smaller the amount of disposable income you have remaining each month, the more likely you are to be eligible to file for Chapter 7 bankruptcy in Pennsylvania.

In contrast, filing for Chapter 13 in Pennsylvania allows you to catch up on your debts by making monthly payments to the Chapter 13 bankruptcy trustee. In a Chapter 13 bankruptcy, you will create a Chapter 13 repayment plan that describes how you will repay a portion of your debt to your creditors. However, to be eligible to file for Chapter 13 bankruptcy in Pennsylvania, the court will want to see proof of your income for at least the previous 6 months prior to the filing of the bankruptcy petition. This is necessary to verify that you will be able to afford your Chapter 13 monthly payments. The income can come from any source including spousal support, a pension, or Social Security benefits. The most important aspect of the income is that it is reliable.

Bankruptcy Discharge


A bankruptcy discharge erases all debts that were included in your bankruptcy. If you file for Chapter 7 bankruptcy in Pennsylvania, you can expect to receive a notice of your bankruptcy discharge 3 to 4 months after you file the bankruptcy petition. However, if you file for Chapter 13 bankruptcy in Pennsylvania, the court will not grant a discharge until you complete the Chapter 13 repayment plan. In addition, if you fail to make all monthly payments on time and in full each month to your Chapter 13 bankruptcy trustee, the court may dismiss your bankruptcy case, and you will not receive a bankruptcy discharge.

Filing for bankruptcy in Pennsylvania is an important decision that will have a lasting impact on your financial situation. Therefore, it may be best to contact an experienced Pennsylvania bankruptcy attorney, or the Pennsylvania Bankruptcy court, http://www.paeb.uscourts.gov/, prior to submitting your bankruptcy petition. 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.