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Lafayette Bankruptcy Law Blog

Who is eligible for Chapter 7 bankruptcy?

Many Louisiana residents may struggle with their overwhelming debt for years before deciding to take significant measures to address it. Of course, even if they decide to move forward with Chapter 7 bankruptcy, they must still meet the requirements necessary to receive debt relief through this option. As expected, a major eligibility factor relates to income.

When hoping to qualify for Chapter 7, potential applicants must first pass a means test. This test involves officials looking at a person's income and comparing it to the median, or middle-level, income of the state. If the individual's income level falls below the median income, it is likely that he or she will qualify for Chapter 7. Documentation of passing this test is important in a bankruptcy petition.

Chapter 11 filed after company receives unfavorable court ruling

Companies that have been operating for decades are not immune to serious financial difficulties. In some cases, Louisiana businesses may have been operating well despite the debt liabilities they held, but a sudden financial blow could cause their circumstances to become unmanageable. As a result, they may file for Chapter 11 bankruptcy for help.

This type of scenario recently befell a company operating out of another state. According to reports, Just One More Restaurant licenses the name of several restaurants in and out of the country. However, a recent dispute regarding Palm Steakhouse resulted in financial woes for the company. A lawsuit was filed in which minority shareholders for the restaurant claimed that they had been cheated out of royalties for 40 years. The judge in the case ruled in favor of those shareholders, and as a result, the company was ordered to pay approximately $120 million to those individuals.

Chapter 13 may work for those who do not qualify for Chapter 7

When struggling with financial issues, namely substantial debt, many Louisiana residents want to find the best option for their particular circumstances. They may even have ideas in mind for finding the debt relief they strive for, like filing for bankruptcy. However, it is important to remember that qualifications must be met for Chapter 7 or Chapter 13 bankruptcy.

Though Chapter 7 is the most commonly-filed bankruptcy petition, it is not for everyone who has debt. For instance, Chapter 7 has income limits, and liquidation may not be an option for parties who make over a certain amount of income or have too many valuable assets. As a result, they may need to opt for another type of bankruptcy, like Chapter 13.

Is debt settlement a beneficial debt relief option? Probably not.

Wanting to get out from under crushing debt is a desire of many people in Louisiana and elsewhere. Of course, finding the right option for reaching that goal can be difficult. After all, it can be hard to determine when a debt relief option is legitimate or is a scam that may only make matters worse. While options like bankruptcy are certainly reliable, some individuals may still want information on other possible paths, like debt settlement.

Some parties may think that debt settlement would be a better option than bankruptcy due to the unnecessarily negative reputation that bankruptcy has. However, debt settlement also has the potential for damaging a person's credit. Individuals will need to direct their debt payments to a settlement account, which means that their payments are no longer going toward their actual bills. This action results in delinquency of payments, which damages credit scores.

Automatic Stay: Relief now, time to find a solution

When you bought your house, you thought your career would only continue its upward trend. You wanted a permanent place to settle down with your family. It was nice, but you knew you could afford it. Your kids settled in, getting used to their new school and making new friends.

Then things went south. Over the next few years, your work dwindled until you were making just a fraction of what you earned before. You lost clients and couldn't replace them. You ran into more competition than you expected. Changes to the market made it harder than ever to make a deal.

Payless ShoeSource again files for Chapter 11

When businesses begin to struggle, company owners may consider their options for addressing financial downturns. In some cases, reorganizing and carrying out different business strategies can help businesses see better days again, but in other instances, filing for Chapter 11 bankruptcy may be necessary. For some companies, it may be necessary more than once.

Louisiana readers may be interested in a recent bankruptcy filing made by Payless ShoeSource. According to reports, the shoe chain first filed for Chapter 11 in 2017 and closed hundreds of its stores at that time. That filing allowed the company to eliminate over $435 million in liabilities. However, a second filing became necessary, and the company filed that petition recently. This current filing listed debt liabilities as totaling between $500 million and $1 billion.

Bankruptcy can often help with medical debt relief

Ideally, every Louisiana resident would remain in perfect health or, at the very least, have the insurance or other funds to fully cover their medical expenses without issue. Unfortunately, that type of ideal scenario does not exist for everyone. In fact, when a medical emergency or serious condition arises, the associated expenses can commonly leave people seeking debt relief.

Approximately two out of every three bankruptcy filings result from medical-related issues. In some cases, the financial problems could stem from the medical bills themselves, or they could come from a person losing income due to a medical condition that leaves him or her unable to work as much as before. Additionally, even with insurance coverage and a comfortable income level, individuals may not escape the financial woes to which medical problems can often lead.

As amount increases, numerous individuals may need debt relief

Money problems as a whole are not a unique issue. Unfortunately, many Louisiana residents and those elsewhere struggle with financial issues. However, each person's exact struggles are different and so are the ways in which they choose to seek debt relief. In any case, it is important to remember that relief options are available.

It was recently reported that Americans are currently carrying a substantial amount of debt. Since 2013, that debt amount has increased by $1 trillion, and the total amount of consumer debt reaches nearly $4 trillion. The report breaks down that amount as $1.6 trillion in student loans, $1 trillion in consumer credit and $1.2 trillion in auto loans. While many people work to pay off their outstanding debt, money mistakes can easily lead to difficulties.

Charlotte Russe files for Chapter 11 bankruptcy

Many factors can play into the success or lack thereof of businesses. At any time, a company could face financial difficulties that leave it reeling. When this happens, it is not uncommon for companies to try to find their best options for addressing the issues they face, which often includes considering Chapter 11 bankruptcy.

Louisiana readers may be interested in a recent report indicating that women's apparel company Charlotte Russe has filed for Chapter 11. Though the company was able to reduce its debt by $124 million last year, it is continuing to struggle. The current amount of debt the company has was not given in the report. However, the business hopes that the bankruptcy filing will allow for its financial struggles to be addressed effectively.

Formulate a plan to pay off credit card debt

If you're drowning in credit card debt, you may struggle with the idea that it's possible to eventually rid yourself of this burden. While it's a long road, there are many steps you can take to pay off credit card debt and regain control of your finances.

Before you can formulate a plan to pay off your credit card debt, it's important to put an end to your spending. If you're always adding more debt to your current balance, you'll never make the progress you're seeking.

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Richoux Law Firm, L.L.C.
110 E. Kaliste Saloom Road
Suite 205
Lafayette, LA 70508

Toll Free: 888-327-5740
Phone: 337-205-7049
Fax: 337-456-6299
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