Bankruptcy is designed to assist in relieving those who have extraneous
amounts of debt and who can only pay the minimum payments. It is also
for those who have had outside interferences weigh on their finances,
such as a divorce, a severe illness, a loss of employment, or a loss of
a major client.
Bankruptcy laws have become stricter in recent years, far more than
they ever were before. Bankruptcy could easily be handled through
online do-it-yourself services in the past, but the new 2005 Bankruptcy
Act has made petitioning for bankruptcy more complicated. Monthly
payments have increased for payment plans and new regulations are now
in place for granting bankruptcy. More paperwork is now required and
the process is must more complicated and complex.
Before petitioning in Nevada individuals will need to gather all the
necessary paperwork. These include tax returns from the past two years,
monthly living expenses for the household, motor vehicle titles, major
financial transactions, real estate deeds, secured debts, loan
documents, unsecured debts, and property assets for possessions.
Filing for Bankruptcy in Nevada
All paperwork can be filed online through an Internet database with
attorney assistance, through do-it-yourself online databases, or
through face-to-face filing with an attorney. It is advised to consult
an attorney to insure that all the necessary paperwork has been filed
with all the new national stipulations.
Even for those who have filed for bankruptcy in the past, filing for
bankruptcy now can be difficult. Do-it-yourself databases can be useful
but at times some details may be exempt. After a petitioning, if the
paperwork was incorrectly filled out or purposeful, false information
was filed, the case will be dismissed by the court.
Bankruptcy petitions are to be brought to the Nevada bankruptcy court
where they will be subject to a means test. A means test will be taken
for every petition for bankruptcy. This test will calculate an
individual's income and personal expenses for the past six months
against the income and expenses of the state of Nevada.
If an individual's expenses and income comes above the state's median
then Chapter Thirteen bankruptcy will be advised. If an individual's
expenses and income comes below the state's median then Chapter Seven
bankruptcy will be advised. The means test is also designed to filter
out those who are abusing the bankruptcy system. An abuse prevention
act has also been passed to keep bankruptcy in use for only those who
need its services.
Kind of Bankruptcy
Nevada has two different kinds of bankruptcy for individuals: Chapter
Seven and Chapter Thirteen. Chapter Seven bankruptcy will liquidate
non-exempt property through a trustee and use the acquired funds to pay
creditors. This process can halt foreclosure and can relieve
individuals of debts in six months or less.
Exempt items are categorized through the state of Nevada for what can
be liquidated and what cannot. Chapter Thirteen bankruptcy will use an
individual's current income to pay off creditors through a personal
payment plan. Designated monthly payments will then be made for a
maximum of five years or a minimum of three years.