If you live in Austin and are overwhelmed by debt and looking for a fresh start, you should consider filing for bankruptcy. Depending on the type of debt you possess, a bankruptcy may erase your debt. However, before filing for bankruptcy, discuss your financial situation with a bankruptcy attorney in Austin. A bankruptcy attorney in Austin will examine your financial situation and help you decide whether filing for bankruptcy is right for you.
 
If you do decide to file for bankruptcy, your bankruptcy attorney in Austin will recommend that you file for either Chapter 7 or Chapter 13 bankruptcy. This decision will largely be based upon your bankruptcy goals and whether you are eligible for each type of bankruptcy. For example, if you do not have a significant number of assets that you would like to keep after your bankruptcy is complete, your bankruptcy attorney in Austin may recommend that you file for Chapter 7 bankruptcy. However, after the changes to the Bankruptcy Code in 2005, to be eligible to file for Chapter 7 bankruptcy you must either earn less than the median income for the state of Texas, or satisfy the means test. The means test is a calculation that your bankruptcy attorney in Austin will perform that examines the amount of disposable income you have remaining each month after paying all necessary expenses. The smaller the amount of disposable income you have, the more likely you are to be eligible to file for Chapter 7 bankruptcy in Austin.
 
However, if you have assets that you would like to keep after your bankruptcy is complete, your bankruptcy attorney in Austin may recommend that you file for Chapter 13 bankruptcy. To be eligible for Chapter 13 bankruptcy, you must have regular and reliable income for at least 6 months before you file for bankruptcy. Regular and reliable income is important in Chapter 13 bankruptcy because you will develop a repayment plan with a bankruptcy attorney in Austin for your Chapter 13 bankruptcy. The plan will take anywhere from 3 to 5 years to complete and the bankruptcy court must approve 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 each month.
 
Bankruptcy Discharge
Following the completion of your bankruptcy case, the bankruptcy court will grant a bankruptcy discharge. A discharge means that your creditors can no longer legally enforce your debts. 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 how to file for bankruptcy. Therefore, contact a bankruptcy attorney in Austin to answer any questions you have or visit the United States Bankruptcy Court, Western District of Texas’ website http://www.txwb.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.