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Here are some examples of median income figures in Georgia as of November 1, 2011.  If your income is less than these numbers, you should have no trouble filing Chapter 7. 

Median Income Figures in Georgia for cases filed after November 1, 2011:

Individual  -  $39,694 per year

Family of 2  - $50,712 per year

Family of 3  - $55,711 per year

Family of 4  - $64,223 per year

Add $7,500 annually for each additional child or household member

If your income is higher than these numbers, we have to run your budget through a second test called the “means test.”

In addition, prior to filing bankruptcy, you are now required to complete a credit counseling session with an approved credit counseling service.  This credit counseling session can be taken online if you wish.

Chapter 13 - A Court Supervised Repayment Plan

By contrast, Chapter 13 is a personal reorganization that makes sense if you are trying to hang on to everything you own, or if you do not qualify for Chapter 7. You still must undergo pre-bankruptcy credit counseling prior to filing Chapter 13.  Specifically, Chapter 13 is frequently used to stop a mortgage foreclosure or vehicle repossession.

Consider Chapter 7 when...

• high credit card balances with no reasonable expectation to pay these bills in a reasonable time

• high medical bills you cannot pay
   
• unexpected lawsuit such as repossession deficiency, credit card or old apartment complex
   
• loss of job and need to downsize lifestyle
   
• recent divorce has damaged budget
   
• you are under a lot of stress
   

Consider Chapter 13 when...
 

• facing mortgage foreclosure
   
• facing car repossession
   
• had income interruption and now need time to catch up
   
• have too much equity in  house or car to qualify for Chapter 7
   
• want to try to pay back as much as you can
   
• you need to file for bankruptcy but cannot qualify under Chapter 7
   
• you are under a lot of stress

As discussed throughout this web site, bankruptcy is a last resort.  Before filing bankruptcy, do your own research about non-bankruptcy alternatives.  I generally advise my clients to avoid the “debt negotiation” services that you hear advertised on the radio or television. 

I participate in a multi-lawyer blog called the Bankruptcy Law Network.  If you go there and type “debt negotiation” in the search box, you will find a variety of articles like this one from lawyers all over the country discussing the questionable value of paid debt negotiation. 

In 2009, I interviewed a documentary filmmaker named Kenny Golde, who was able to negotiate settlements of hundreds of thousands of dollars of credit card debt.  This interview is posted on my Atlanta bankruptcy blog.  As Kenny and I discuss during our interview, there are no “secrets that the credit companies don’t want you to know.”  Credit companies will negotiate a lower balance, but generally they will not even start to negotiate until you are 3 to 4 months behind, and if you want to settle, you will need cash. 

Depending on the circumstances, Chapter 7 or Chapter 13 can also be used to modify or eliminate IRS and other tax obligations, student loans and judgment debts.  Please fill out my Georgia bankruptcy law new client questionnaire, fax it to me at 770-393-0240 and I’d be happy to schedule an appointment to give you my analysis.

This website copyright 2011 by Ginsberg Law Offices, P.C.  All rights reserved. No reproduction of the original content on this site without express permission of the site owner.  Please direct inquiries to Jonathan Ginsberg, Ginsberg Law Offices, 1854 Independence Square, Atlanta, GA 30338.