Married Filing Bankruptcy Without Your Spouse

September 1st, 2017

If you’re married Filing Bankruptcy Without Your Spouse isn’t a problem One of the concerns our clients often have is about their marriage and the effect it may have on bankruptcy. Bankruptcy and marital status do matter, but mostly in ways that are beneficial to the debtor.

Marriage and Filing Bankruptcy Together

Bankruptcy laws allow married couples to file a case together or filing bankruptcy without your spouse is okay too.  This pools their assets and liabilities and wipes out all of the latter for both spouses.  This is beneficial for two reasons.  First, it allows the couple to take advantage of bankruptcy exemptions, particularly the exception for vehicles.  If a person files individually, they may exempt one vehicle from the bankruptcy estate.  If a couple files jointly, they can both take the exemption and keep two vehicles.

Second, in a situation where the couple has been married for a number of years, it is likely that they both contributed to debt.  In that case, filing bankruptcy for just one half of the couple would only eliminate the debts as to the filing spouse.  Creditors could still take action against the non-filing spouse.  This could lead to a situation where, after one spouse has already filed and completed an individual bankruptcy, the other spouse must do the same.  Filing jointly in such cases saves time, money, and stress.

Marriage and Filing as an Individual

That said, there are circumstances where it is beneficial for a spouse to file as an individual.  For instance, it could be a relatively new marriage, or the couple could have all of the debts in the exclusive name of one spouse, leaving the other debt free.  In those circumstances, the married individual can file as an individual, but the marriage will have certain effects.

First, the individual can claim their spouse as a dependent.  This increases their family size to two.  They then may add any children as additional dependents.  This is important, because the means test (the form that determines if a person may file a chapter 7 bankruptcy) is takes into account family size, and the larger the family the higher the cap on income.  The potential downside to this is that when income and expenses are determined, family income, rather than individual, is used.  So, if the filing spouse has a relatively low paying position, they would still need to account for their spouse’s higher income just as if they were filing together.

One more circumstance worth consideration is bankruptcy prior to divorce.  If a couple is planning on divorcing, it can often be extremely beneficial to file a joint bankruptcy beforehand.  This allows for them to eliminate all dischargable debts prior to negotiating the divorce.  One of the more contentious areas for a divorce is who gets what and who pays what.  By eliminating most of the liabilities prior to starting the divorce process, a couple can avoid unnecessary fighting and stress.

Read This Related Oklahoma Bankruptcy Topics; Secured and unsecured debts in bankruptcy

Legal Support For Your Oklahoma Bankruptcy Filing

Married Filing Bankruptcy Without Your Spouse is okay. In most circumstances, a joint bankruptcy is the most beneficial choice for a couple contemplating bankruptcy.  If you are a couple considering bankruptcy, consult an experienced bankruptcy attorney today.  Our Tulsa bankruptcy attorneys can review your situation and help you decide what is best for your circumstances. Free help and questions at 918.739.8984

Oklahoma Medical Bankruptcy Attorneys Can Help

July 14th, 2017

Oklahoma Medical Bankruptcy Attorneys can help you if you’re facing medical bills that are overwhelming you. One of the most common reasons our clients cite for filing bankruptcy is medical debt.  It is a leading source of financial hardship and struggle nationwide.  For many people drowning in medical debt, bankruptcy is a way to start over and build a better financial future.

Medical debt is somewhat different from most other forms of unsecured debt.  There are several reasons for this.  First, medical debt is usually not a choice.  Most people can choose to purchase something with a credit card or to take out a payday loan.  Medical procedures tend to happen whether people want them or not.  No one chooses to have a car accident or a heart attack, but the doctor bills come just the same.  Further, even with good insurance (much less without insurance), out of pocket costs can be staggering.  For those who do not, or cannot, plan ahead financially, a serious accident or illness can cause financial ruin.

Bankruptcy and the Unique Problem of Medical Debt

Though medical debt is a leading cause of bankruptcy, it does present a unique problem when preparing a bankruptcy.  Unlike most forms of debt, medical debt does not appear on a credit report.  Though, there are some exceptions.  For instance, if it passes to a third party debt collector.  It can be difficult to account for all of a person’s medical debt when filing.  This is simply because there is generally no central place reporting it all.  If a person has several different doctors or specialists, it can be very difficult to track down a bill for each one.

In most cases, this is more an annoyance than an actual problem.  In most Chapter 7 cases, none of the creditors receive any payment.  Therefore, all dischargable debts will discharge.  But in a case where creditors do receive payment, leaving out creditors can be a serious problem.  In those cases, a creditor who was left out would at least be entitled to what they would have received had they been included.

Other Bankruptcy Articles Related to will my Oklahoma bankruptcy be approved

Medical Debt and Timing in Bankruptcy

The other major problem with medical debt is that it can be sometimes be difficult to determine the right time to file.  Bankruptcy only addresses debts that come from before the case files.  If the medical debts are from routine procedures, or a one time accident like a car accident or a slip and fall, then it is fairly easy to determine when all the bills have been generated.  Therefore, it helps to determine when a person should file to discharge all of them.  But in a case where there is a longer term issue like cancer, an injury that will require multiple surgeries, or a chronic condition, it becomes a much more difficult question.  A person must balance wanting immediate debt relief versus the prospect of acquiring more medical debt–that cannot discharge–after the bankruptcy files.

Finally, if medical debt passes on to a third party collection agency, that presents its own set of issues.  Companies specializing in medical debt collection are often the most aggressive in pursuing payment.  They do not hesitate to make badgering phone calls, send threatening letters, or file lawsuits to get the payment they want.  This not only increases the stress on the person in debt but can lead to wage or bank account garnishment due to lawsuits.

Help From Oklahoma Medical Bankruptcy Attorneys

If you have significant medical debt that you are struggling to pay, it may be time to consider bankruptcy.  Call our Oklahoma medical bankruptcy attorneys today for help. Don’t let the pressure from medical bill cause you to suffer more health problems. Each year millions of Americans suffer overwhelming debt that’s the result of medical bills that they just cant pay. Don’t go it alone call our Bankruptcy law firm and lets get this taken care of. 918.739.8984

Tulsa Lawyer Examines When is it Time to File Bankruptcy

June 28th, 2017

The most important question a person asks themselves about filing bankruptcy is When is it time to file bankruptcy?  Our clients often fear filing and want to file at the most advantageous moment.  Because everyone’s financial circumstances are different, each person will have a different answer.  That said, there are a few commonalities leading to bankruptcy that help answer the question when is it time to file bankruptcy.

Common Triggers to Filing Bankruptcy

First, and perhaps most obvious, is when a creditor garnishes your wages.  After a creditor sues you, they have the right to collect the judgement.  This often arrises in the form of a garnishment.  This basically makes your employer turn over part of your earnings to the creditor.  This can be a major problem for people who are working to maintain any type of living.  Bankruptcy is a common solution to this problem since it immediately ends the garnishment once you file.

Similarly, if you are facing repossessions, filing is a solution.  Any creditor that repossesses your vehicle will sell it.  They will then use this money to offset anything you owe.  This is problematic though.  The amount the creditor gets in the resale is generally significantly less than what you owe.  So not only do you no longer have the car, you may still owe them thousands of dollars.  Further, auto lenders often file lawsuits on these types of debts which leads to garnishments and possible revocation of driving privileges.

While less common, foreclosure is a very serious trigger for bankruptcy.  There are two options to handling foreclosure in bankruptcy: a Chapter 7 or a Chapter 13 bankruptcy filing.  Chapter 7 bankruptcies will either allow you to wipe out debt by returning the house to the bank, or allow you to reaffirm the house.  Reaffirmation of the house will mean your other debt clears, but you still must make payments on the house.  A Chapter 13 can save the house, even if a foreclosure is already in place and a sheriff’s sale is set.  So long as a Chapter 13 is a feasible option and you file before the sale, it will stop the sale and ensure that you can keep your home.

Read About This Related Article Filing Bankruptcy without a lawyer.

Timing: When to File and How

Outside of those major triggers, the question of filing bankruptcy and when is mostly a question of your confidence in your financial situation.  Generally, if you can make the payments on your debts and still pay bills, you are ok.  If you are using one credit card to pay off another card, or taking out lots of payday loans to make ends meet and get creditors paid, then it may be time to consult a bankruptcy attorney.

As you can see from this article the question when is it time to file bankruptcy is a question that depends on your particular circumstances. Bankruptcy can be a lifeline for people in financial difficulty.  Whether it is due to any of these triggers or some other situation, bankruptcy can be a solution.  Our attorneys have the experience and skill necessary to streamline the process.  Let us help make the way easier for you.  Call now 918.739.8984

Tulsa Bankruptcy Lawyers Discuss Removing Liens From Your Home

June 5th, 2017

Removing Liens From Your Home in bankruptcy is possible if you do the the right thing. Many people who end up filing bankruptcy don’t consider filing until they are under suit by a creditor.  It’s generally best to file bankruptcy before creditors file lawsuits, but most people consider bankruptcy an absolute last resort.  For many debtors, the prospect of suffering wage garnishment before the bankruptcy files is the most serious issue.  For homeowners, however, there is another issue to consider:  liens.

Removing Liens From Your Home

When a creditor successfully sues a debtor, they have a few different options for collecting judgments.  The most common is a garnishment.  This is where the court orders the debtor’s employer to withhold a portion of the debtor’s pay on every check to pay the creditor.  If the debtor owns a home, the creditor can also obtain a lien against the property.  A lien is a claim against the property itself.  Basically, it says that in order for this property to be sold or transferred, the creditor must be paid.  They can receive payment either before the sale or after the sale, but they require payment regardless.  In many cases, debtors don’t even know that the lien exists until they try to sell the house.

Motion to Avoid Liens on Your Home

There is a fix for this problem. It is a Motion to Avoid Lien.  First, if you are contemplating bankruptcy, own a home, and are under suit by a creditor, inform yourself.  Contact your county’s land records department and have them look for any liens against your property (other than your mortgage).  If you do have judgment liens against your property, let your attorney know before the case files.  Making sure that your attorney knows about the liens will save you time, money, and headaches in the future.  Once your attorney knows about the liens, he or she can plan to have the bankruptcy court remove them with a document called a “motion to avoid lien”.  This is separate from the basic bankruptcy process, which is why it is so important for the lawyer to know beforehand that he or she will need to take action.

If your bankruptcy completes, and you become aware that there is a lien against your property, that is still fixable.  Your attorney can ask the court to reopen the case, and after the court grants that request, he or she can file the motion to avoid lien, just as if it had been done during the normal bankruptcy period.  The downside to this approach is time and money.  Reopening the case and filing the motion takes at least four weeks and the court charges several hundred dollars to re-open a case, not including the cost of your attorney’s time and efforts.

Related bankruptcy information asking the question Will my Oklahoma bankruptcy be approved

Call Our Bankruptcy Lawyers For Help

If you own a home and are considering filing a bankruptcy consider removing liens from your home in bankruptcy. Our Tulsa bankruptcy lawyers have helped thousands of people just like you get a successful bankruptcy filed. Regardless of the question we can help you. Call us today or read through our bankruptcy attorneys blog for more information. We can help 918.739.8984

Tulsa Lawyers Explain Filing Oklahoma Bankruptcy During Lawsuits

June 1st, 2017

Filing Oklahoma Bankruptcy During Lawsuits may impact your case. Depending on what kind of lawsuit you’re involved in determines how any potential proceeds form that lawsuit are handled. In certain instances all of the proceeds you hope to win will be exempt while in others they will not.

Auto Accidents and Filing Oklahoma Bankruptcy

Filing Oklahoma Bankruptcy During Lawsuits involving pain and suffering are very common.  Suppose you were injured in an auto accident or on the job, and you were considering filing a claim against the other driver or your employer.  Then you decide to file bankruptcy.  You might think that if you took your personal injury case to court, you would be forced to give up any money you were awarded for your injuries, pain, and suffering in the bankruptcy.  Your attorney could look at your claim and let you know if it qualifies for an “exemption”.  An exemption is money or property that doesn’t get turned over in a bankruptcy.  For claims over personal injury, death, or workers compensation, the exemption can cover up to $50,000.  Your attorney can also tell you how to handle the money so it isn’t mistaken for money that isn’t covered by an exemption.

Other Oklahoma Bankruptcy Information: Secured and unsecured debts in bankruptcy

Restitution Payments and Filing Oklahoma Bankruptcy

Suppose instead that you were the victim of a crime, and you were due to be awarded compensation.  Again, you might assume you’d have to give that up, but your attorney would be able to tell you that such proceeds are also covered by an exemption.  However, suppose you were considering filing a different kind of civil case, like a wrongful termination or a sexual harassment lawsuit.  You would be wise to consult an attorney, because your attorney would tell you to carefully weigh your options.  Those types of cases, unlike injury cases, are not covered by any exemptions.  Therefore, if you win money, the bankruptcy estate could (and likely would) take it.

Contact One of our Bankruptcy Lawyers in Oklahoma:

A dedicated, professional Tulsa bankruptcy attorney can help you sort out your options when you file bankruptcy. We can guide you towards the best decisions for your financial future.  Thinking about bankruptcy in Oklahoma may be scary, but the process of filing doesn’t have to be.  Contact our local bankruptcy firm at 918.739.8984 or read more bankruptcy information on our Tulsa bankruptcy attorneys blog.

Do I need an Attorney to File Bankruptcy in Oklahoma

May 17th, 2017

Although a bankruptcy case is filed in the federal court and controlled by federal bankruptcy laws just like most State Court claims you have a right to file bankruptcy in Oklahoma without a lawyer.  In fact its not entirely unusual to find people representing themselves in bankruptcy court. If you do decide that you want to represent yourself in bankruptcy court there are some basic questions that you will have to decide

How to File Bankruptcy in Oklahoma:

  1. What chapter of bankruptcy should you file. This is a bankruptcy question that is often decided by what your income is. If your income is below the median family income as found in the means test than you qualify for a chapter 7. On the other hand, if your income is above the median family income than a chapter 13 may be what you decide to file.
  2. Once you’ve decided which chapter of bankruptcy is right for you its time to decide in which bankruptcy court to file the case. Oklahoma has three federal bankruptcy courts. Which one you file in depends on what county you live in. Generally, if you live in Northeast Oklahoma you will file your case in Tulsa. If you live in Southern Oklahoma you will file your case in Okmulgee. Finally if you live west of Tulsa on in to Western Oklahoma than your case is filed in Oklahoma City.
  3. If you own real property like a home or land you’ll have to decide which exemption to use. In Oklahoma your home and the land its built on is exempt in the bankruptcy. This means that you’ll have to decide what the proper bankruptcy exemption is an choose it in the paper work. Remember, the exemption is for your primary residence only. This means the exemption does not extend to rental property you may own or other property than your name is listed on.
  4. If you own a car you’ll have to decide if you can keep it in bankruptcy. The answer is maybe. The bankruptcy exemption is 100% provided the value of your car is under a certain amount. Also the exemption only allows one car for each personal filing. So id f you and a spouse is filing than each of you can keep your vehicle in the bankruptcy. There are several other ways to extend the vehicle exemption to additional vehicles but this will require you to do some research

Related Bankruptcy information: Keeping your car in bankruptcy

We Can Help You File Bankruptcy in Oklahoma:

If you need help filing a bankruptcy in Oklahoma or have any questions or concerns about filing bankruptcy feel free to call our Bankruptcy attorneys in Tulsa. We file bankruptcy for our clients in all Federal bankruptcy Courts throughout the State. Bankruptcy doesn’t have to be so hard. Our Oklahoma bankruptcy lawyers have filed thousands of case and have helped our client file both chapter 13 and chapter 7 bankruptcy. Get Help 918.739.8984

Will my Oklahoma Bankruptcy be Approved

October 17th, 2016

One of the worries we get from clients at the beginning of the bankruptcy process is will my Oklahoma bankruptcy be approved?  Assuming the client qualifies in the first place and follows directions, the case will be successfully approved.

Of course, the first step to any successful bankruptcy, particularly a Chapter 7, is qualifying.  The two biggest hurdles to qualifying for a Chapter 7 are previous filings, and income.  As per 11 U.S.C. § 727 (a)(8), debtors are not permitted to receive a discharge in a Chapter 7 if they received a case that was filed in the eight years prior to the current case.  The other hurdle is income.  To qualify for a Chapter 7, a debtor (or joint debtors) must have a family income beneath the median income for a family of the same size in their county of residence.

Qualified to File Now What:

Will my Oklahoma Bankruptcy be Approved has been answered as yes so now what? Once the debtor qualifies to file, the only real obstacle to completing the case and getting it approved  is a failure to follow the directions of the bankruptcy process.  It is important to remember that bankruptcy is a process:  it has well established steps that if followed yield a predicable result (in this case, a discharge).  If they aren’t followed, though, problems will arise.

The two biggest ways in which a client can fail to follow the process are by failing to appear at their 341 hearing, and by failing to complete the debtor education course.  The court requires every debtor to attend a meeting with the trustee before a discharge can be granted.  The trustee asks several questions under oath, establishing that the debtor read and understood their bankruptcy and that they included everything that should be in it.  In addition, the trustee can clear up any questions he or she or a creditor has about the case.  If the debtor fails to attend the first meeting, it will be rescheduled.  If the debtor fails to attend the second reason without a compelling reason, the trustee may move to dismiss the case.

Last Step is Easy so Just Get it Done:

Finally, just as the debtor is required to complete a pre-filing credit counseling course, the debtor is required to complete a post-filing debtor education course.  This course must be completed within 90 days of the date of filing.  Barring a compelling reason for not doing so (such as disability), the court will dismiss the case of any debtor who fails to complete the course without a discharge.  This means the debtor would have to start all over again at the beginning in order to obtain a bankruptcy discharge.

You May Like This Bills-included-in-bankruptcy

Contact a Tulsa Bankruptcy Lawyers For Help:

If, however, a debtor qualifies and follows the directions, their case will almost certainly be concluded successfully with a discharge.  The best advice that can be given to a client is to listen, answer any questions from his or her attorney accurately and honestly, and to follow directions from his or her attorney. So its easy. The answer to the question will my Oklahoma bankruptcy be approved is yes. Once you qualify all that’s required is for you to get the paperwork to your Tulsa bankruptcy lawyers and we’ll help do the rest. Call for information 918-739-8984 today a get a free consultation or read our Tulsa bankruptcy lawyer blog for answers to questions..

Tulsa Bankruptcy Attorneys Discuss Bills Included in Bankruptcy

October 6th, 2016

Bills Included in BankruptcyThe bills included in bankruptcy really means all of them. Its not always simple trying to figure the ins and outs of bankruptcy law in Oklahoma. To begin with our Clients are in deep financial trouble attempting to fend off the stress of finances only to face the complications of bankruptcy law. Clients come to us in a general state of financial panic. They wonder what bills are included in bankruptcy together with a thousand other important questions. We tell them to take it easy and let our bankruptcy lawyers take over. The truth is that Oklahoma bankruptcy doesn’t have to be so hard. Our attorneys take the time to go over your case with you and help reduce the anxiety by providing you with answers to bankruptcy questions.

Common Questions About Bills Included in Bankruptcy:

A question we get asked frequently is “what bills are included in bankruptcy?  Can I exclude some of them?”  The short answer is, all of your debts debts must be included.  The longer answer is a bit more complicated.

11 U.S.C. § 521(A)(1)(a) states the first item in a list of the debtor’s duties is to file a list of his or her creditors.  This has been interpreted to mean all of his or her creditors, no exceptions.  A creditor is any person or entity the debtor owes money to, be it a credit card, a bank, a medical bill, an individual, or anyone or thing else.  A debtor can keep a debt by reaffirmation if he wants to keep property that is secured by that debt, but even in that case, the creditor is still listed.

If Its in Your Name Include the Bill in Bankruptcy:

That said, there is an important distinction to be made.  The duty created by §521 only applies to persons who are actually filing.  If the debtor is married, but filing individually, the only creditors included are ones that the debtor is actually named on.  Suppose the debtor has a credit card in his name, a car loan in both his and his wife’s name, and his wife has a medical bill in her name.  If the debtor is filing by himself, he would include the credit card and the car loan, but not the medical bill, as it is not in his name.  Of course, if the debtor and his wife are filing jointly, all three would be included.

Bankruptcy and Medical Bills of a Spouse:

In Oklahoma one spouse is responsible for the medical debt of the other spouse. This means that if at any time during your marriage either partner gets sick and acquires medical debt both spouses are liable for the debt. Sometimes one spouse files a bankruptcy while the other doesn’t. This is fine and it happens all the time. But, in this situation remember that if there’s medical debt from the other spouse and you don’t list it you might latter be liable for it.

In conclusion, Bills Included in Bankruptcy include a list all of the debts on which you are named. This even includes those things that you intend to keep. However, this doesn’t include bills that you are not named on, even if they are your spouses, except for medical bills.

Keeping Multiple Cars in Tulsa bankruptcy

September 22nd, 2016

Keeping Multiple Cars in Tulsa bankruptcy - South Tulsa Bankruptcy law firmKeeping Multiple cars in Tulsa bankruptcy is possible if you think it through. From Route 66 to I-35, Oklahoman’s love their cars, trucks, and motorcycles.  We often have clients coming in to file bankruptcy who own more than one vehicle.  They want to know if they can keep both their daily driver and their motorcycle, work truck, classic car, or garage project.  Its a question of keeping Multiple cars in Tulsa bankruptcy. In most cases, the answer is yes but, it takes some doing.  Suppose we have a client, we will call him Jim, with two vehicles:  a 2012 Ford Focus, in good condition, with 60,000 miles on it that he drives daily, and a 2005 Honda motorcycle he rides on the weekends.

To determine which vehicles Jim gets to keep, we ask three questions:  how many vehicles does he own, how much are they worth, and how much value does he have in each.

Number of Vehicles Counts in Oklahoma Bankruptcy:

Keeping Multiple Cars in Tulsa bankruptcy depends on the number of vehicles involved. This is important, because according to the bankruptcy code 31 OS § 1(A)(13), each debtor gets an exemption in one vehicle up to $7,500 in value.  In a joint bankruptcy, this means that both debtors get a vehicle exemption.  Jim owns two vehicles, so we know he can almost certainly keep at least one of them right off the bat.

Next, we have to determine how much each vehicle is worth.  When we say “worth,” this means the selling price of the vehicle, based on the year, make, model, mileage, and condition.  For Jim, based on what we know, the Ford would be worth about $6000, and the motorcycle would be worth about $1500.  If we refer back to the previous question, we know for sure, now, that Jim will be able to keep at least one of these vehicles due to the exemption.

Finally, we determine how much value the client has in each vehicle.  Value, in this case, means equity.  So we take into account not just how much the vehicle is worth, but how much is owed on the vehicle to a secured creditor, such as an auto loan.  To figure out the value, we take how much the vehicle is worth, and subtract how much is owed.  Suppose Jim owes just $2,000 on his Ford, and his bike is paid off.  In that case, we would subtract the $2,000 owed from the Ford’s worth of $6,000 and come up with a value of $4,000.  But suppose instead that Jim owed $7,500.  In that case, the vehicle would have a value of $0.  In both of those cases, because the bike is paid off, it is worth the full $1500.

Which Vehicle Gets the Oklahoma Bankruptcy Exemption:

Once we know the value of each vehicle, we determine which one gets exempted.  The first priority is to ensure that the client has a daily driver.  If the daily driver is the vehicle with the most value, it gets the exemption.  However, in many cases, clients have little or no value in their daily driver because they owe close to or more than it is worth.

In that case, we exempt the most valuable vehicle, because they trustee will not take a car with little or no value.  So, for our client Jim, if he owes $2,000 on his Ford, we would exempt it, as it has a value of $4,000 and it is his daily driver.  In that case, the trustee might take his bike.  But if he owes $7,500 on his Ford, we would exempt the bike, because his daily driver has no value, and the bike is the most valuable vehicle remaining.

Contact a Tulsa Bankruptcy Lawyer for Information:

In conclusion, Keeping Multiple Cars in Tulsa bankruptcy is possible and all people can keep at least one.  Whether or not they are able to keep other vehicles depends on how much value each vehicle has.  If you are considering bankruptcy and own multiple vehicles, consult with a bankruptcy attorney and read our Tulsa bankruptcy information blog to determine what the value of your vehicles is, and what the best course of action for protecting them is.

 

Secured and Unsecured Debts in Oklahoma Bankruptcy

September 15th, 2016

Secured and Unsecured Debts in Oklahoma Bankruptcy

The difference between secured and unsecured debts in Oklahoma bankruptcy is important. One of the most frustrating things about bankruptcy for clients is the use of terminology that they’re unfamiliar with.  One of the most frequent questions we get is whats the difference between Secured and Unsecured Debts in Oklahoma Bankruptcy. As part of that question people also ask why does it matter anyway?

Secured Debt Oklahoma Bankruptcy:

Secured debt is the easiest to understand.  To put it simply, secured debt is money that was borrowed to make a specific purchase. Its made with the understanding that the lender will have a claim on the item purchased. For instance, if you go to your bank and borrow $20,000 to buy a new car, the bank gets a “security interest” in the car.  If you stop paying the bank, they can take the car in order to recoup their losses.  The same goes for things like mortgages and home equity loans.  You are giving security in the item in exchange for the money.  This also includes what are called “purchase money security interests.”

These are basically the same as the auto or mortgage loans, but on a smaller scale. An example is, if you take out a $2,000 line of credit at a furniture store, or take out a line of credit at a place like Conn’s to buy a TV.  These are important because often, the property involved in a secured debt is exactly the property that clients want to keep.  Fortunately, they can keep the property by keeping the secured loan, through a reaffirmation agreement.  Secured debts can be discharged in bankruptcy, but the creditor gets the property.

Unsecured Debt in Oklahoma Bankruptcy:

Unsecured debts are basically everything else.  Medical bills, credit cards, payday loans, money borrowed from a friend, judgments, repossessions, and many others are all unsecured.  Essentially, if there isn’t some kind of personal or real property attached to the debt, it is unsecured.  With a few exceptions, specifically, child support, back taxes, and student loans, unsecured debts can be discharged in bankruptcy.

Finally, we are occasionally asked about “priority” debts.  Priority debts are a special type of unsecured debt that is supposed to be paid back before any other unsecured debt.  They have priority over the other unsecured creditors.  Priority debts are usually debts owed to the government, like back taxes or past due child support.  In most bankruptcies, this is a meaningless distinction, because none of the unsecured creditors will be paid back.  In cases where creditors will be paid like a Chapter 13, or a Chapter 7 Tulsa  bankruptcy where assets will be distributed, the priority creditors get paid in full before any other unsecured creditors.

Tulsa Bankruptcy Forgives Secured and Unsecured Debt:

In conclusion, the difference between secured and unsecured debts boils down to whether or not property is attached to the debt.  Priority debts are a special form of unsecured debts but are of no concern to the large majority of bankruptcy cases. Secured and Unsecured Debts in Oklahoma Bankruptcy are both forgiven. If you are concerned about which of your debts are secured or unsecured, contact our South Tulsa Bankruptcy Lawyers Law Office today.