Financial challenges are a part of life, but if you’re the one who is struggling with financial problems because of several reasons like health issues and other economic situations. Bankruptcy in Kentucky can be the ultimate solution for you.
This article can walk you through the effectiveness of bankruptcy in Kentucky and help you learn more about the process.
How Does Bankruptcy In Kentucky Work?
Filing bankruptcy in Kentucky is like the other states’ processes. Instead of Kentucky state law, the federal law of Kentucky supports the bankruptcy process. Its process helps you get a fresh start by unwinding contract terms between you and your creditors.
Kentucky law plays a significant role by helping you keep the property in your bankruptcy case. Further, you would learn different filing information with the attorney’s help while going through the basics.
Figure 1. Bankruptcy in Kentucky
Chapter 7 Bankruptcy
The majority choose chapter 7 bankruptcy for several reasons. The main reason is that chapter 7 facilitates you with a faster process. The other reason is it’s a cheap option as you don’t need to pay the creditors.
This bankruptcy option works well, especially for those whose property possesses essential items needed for work and living. However, if you have unnecessary luxury items for living, chapter 7 bankruptcy can’t save them.
You may lose your luxury properties if it’s behind your filings. It’s one of the significant drawbacks of filing for Chapter 7 bankruptcy.
Chapter 13 Bankruptcy
In chapter 13, bankruptcy filers must pay their creditors through a five-year repayment plan. However, chapter 7 doesn’t facilitate you with a repayment plan option. The repayment plan comes with benefits for the filers.
This plan helps keep your property and save your house from repossession issues. The only downside of chapter 13 is that it’s an expensive bankruptcy option.
Essential Considerations While Filing Bankruptcy In Kentucky
1. Get Familiar With Bankruptcy Filing Types
Before filing for bankruptcy in Kentucky, one should understand the types of bankruptcy. The majority go for these two types of bankruptcy.
- Bankruptcy Chapter 7
- Bankruptcy Chapter 13
Chapter 7 is often cheaper and makes you stress-free through debt relief more quickly. However, you may face some pros and cons of filing bankruptcy chapter 7.
2. Understand Which Debts You Can Eliminate
Chapter 7 bankruptcy in Kentucky helps to eliminate all unsecured debts. Do check what property you’re more prone to lose. Going through bankruptcy exemptions will be helpful to secure your property and equity while filing for bankruptcy.
3. The Qualification Requirement for Bankruptcy
Using the mean test, you can qualify for bankruptcy in Kentucky. Or you can qualify if your income is below the allowed income of Kentucky.
Figure 2. Requirements for bankruptcy in Kentucky
What Is The Cost For Filing Chapter 7 Bankruptcy in Kentucky?
The estimated cost for filing chapter 7 bankruptcy in Kentucky falls between $1100 to $2000. However, the cost of chapter 7 bankruptcy also depends on different factors, like:
- Location in Kentucky
- The complexity of the case
- The type of bankruptcy
- Attorney charges
Suppose you are concerned about losing your belongings in bankruptcy. Bankruptcy exemptions will be beneficial for you to save your belongings like a car or house.
If you want more profound knowledge about bankruptcy in Kentucky, seeking advice from an expert attorney can make law easy for you. Whether you file for bankruptcy in Kentucky for chapter 7 or chapter 13, it’s crucial to consider the pros and cons of each. It would help you find the most suitable for you.