South Carolina bankruptcy laws: What are the Laws Regarding Bankruptcies in the State of South Carolina
Bankruptcy is a legal process that has been set up to essentially give people a fresh start by relieving them of the quite burdensome debts.
If you find yourself struggling to pay your monthly bills, it might be a good idea to file for bankruptcy in South Carolina, as it could help get you back on track. Majority of the citizens are not aware of the bankruptcy process. After you know which type of bankruptcy works best in your situation, it will be much easier for you to file for bankruptcy.
Technically speaking, there is no such thing as South Carolina bankruptcy law; in fact, it has federal laws governing bankruptcy. However, South Carolina state laws will affect your case.
When you declare bankruptcy in South Carolina, most of the time, you will be declaring Chapter 7 bankruptcy, or better known as the process of liquidation. However, you will have to enter a credit counseling program for at least six months before you file for bankruptcy. To make sure that you are eligible, you must also earn less than that of the median annual income for your state in a year. If you meet these qualifications, you are free to file for bankruptcy. As the name liquidation bankruptcy implies, you will be in the process of liquidating your assets to pay off your creditors. The good news is that each state has exemptions which will keep creditors from taking most if not all of your assets/property.
The process of filing for bankruptcy
The first thing that you'll need to do when you register for bankruptcy in South Carolina is to contact a lawyer. It is essential that you find a good lawyer who is well experienced in the laws that pertain to bankruptcy. Next, you need to collect paperwork that contains information such as your income, what significant possessions and property you own, and a list of your current living expenses. The data collected is then used to fill out the various forms required when you file for bankruptcy. The petitions and forms are later filed with the South Carolina district bankruptcy court, and your case is ready to go.
Bankruptcy Law is Federal Law
In Article I, Section 8, the Constitution gives Congress power to enact the uniform bankruptcy laws.
Types of bankruptcy in South Carolina
Chapter 7 Bankruptcy
It frees you, as a debtor from your debts. However, any property that you own, which is not protected under exemption may be sold to repay your debts. If you have secured debts, you will be required to either return that property or work out some agreement to keep the property. You are allowed to file Chapter 7 only once every eight years.
Eligibility for chapter 7 bankruptcy
The court will compare your income to the average salary in your state to see if you can repay your debts. If you earn more income than allowed by Chapter 7, you may only be able to file for a Chapter 13 bankruptcy.
Chapter 13 Bankruptcy
Under this, it allows you to pay your debts over some time. Within three years, but it can be up to five. Majority of the people filing under Chapter 13 will pay back only a part of their debt. It is a good option for people who have a steady monthly income. It is a better option for people who want to remain in possession of their homes. Furthermore, if you have filed for Chapter 13 once before, there are strict rules about filing for bankruptcy repeatedly. There are strict rules also apply if you are trying to change your filing from Chapter 13 to Chapter 7.