The Coronavirus crisis has made many things difficult if not downright impossible. But fortunately — at least for now through early October 2020 — it’s still possible to file bankruptcy in Rhode Island. Here’s a quick list of some of the “essential” details:
court hearings are being conducted by telephone or video (using Zoom.gov) and can even be viewed via YouTube
What hasn’t changed is that there are still Rhode Island attorneys experienced with personal bankruptcy (e.g., Chapter 7 or Chapter 13) who can help guide you through the details of filing bankruptcy. Feel free to give us a call 401-738-3030 or email to set up a free RI bankruptcy consultation.
The Rhode Island Bankruptcy Court allows cases to be filed very quickly. If you submit the necessary papers and filing fees, an experienced attorney may be able file your case in less than 24 hours. You may be able to use this “fast track” filing option to immediately stop creditors from harassing you, prevent your electric or other utilities from being shut off, keep your wages from being attached, or stop your home from being lost to foreclosure if you’ve fallen behind on your mortgage payments.
Of course, filing is only the first step to completing a bankruptcy. And you want to do it right because your bankruptcy filing will be reviewed for errors which could cause your case to be dismissed. So it’s important to find an attorney experienced with bankruptcy when you’re doing a rush filing to avoid costly mistakes. If all goes well, you may have your case successfully processed by the court and closed within 90 days after filing.
A Rhode Island bankruptcy filing can be used to get rid of many types of debt. Filing under Chapter 7 may allow many types of debts to be wiped out completely:
credit card debt
electric, gas, water, and other utility bills
medical, dental, and vision bills
personal and unsecured bank loans
automobile loan obligations remaining on a repossessed vehicle
mortgage loan obligations remaining on a foreclosed home
Any child support obligations, recent taxes, and student loans are generally not eligible for discharge. But in some cases, even student loans can be eliminated in a bankruptcy if it can be shown that these debts create an unreasonable hardship for you.
According to a recent study, the typical Rhode Island house lost 25% of its value last year. For many homeowners, the only alternative to losing a home to foreclosure may be to modify their mortgage. Fortunately, current bankruptcy laws allow for many Rhode Island homeowners to dramatically reduce their monthly mortgage payments.
If your house is valued at less than you own on your first mortgage, you may be able to eliminate most of yoursecond mortgage with a bankruptcy (for owners of rental properties or investment real estate, it’s even better: you can often use a RI bankruptcy filing to modify both the first and second mortgage). This can be done by filing for a Chapter 13 bankruptcy: you eliminate your second mortgage obligation and instead make a series of monthly payments for a limited period of time (between 36 and 60 months, depending on your income).
Given the magnitude of most second mortgages, this approach can result in significant savings. For example, if you have a $40,000 second mortgage, you could potentially eliminate all but $7,200 of your debt in a Chapter 13 bankruptcy.
Yes — in many cases filing a Chapter 13 bankruptcy can stop a home foreclosure sale from proceeding. Over the years, many Rhode Island homeowners have used this type of bankruptcy filing to prevent foreclosure and allow themselves to get caught up on their mortgage payments and keep their house.
People sometimes find it necessary to file bankruptcy again. The good news is you can file again; the bad news is you may want to wait a while. Under the new bankruptcy law, you can file a Chapter 7 bankruptcy eight years after you initially filed for Chapter 7 . You must wait four years to file for Chapter 13 bankruptcy again.
You can actually file for Chapter 13 even before the 4 year limit, but in this case you’ll have to pay back 100% of your debt over time. While this might not sound like an appealing option, it may be a useful approach for people attempting to save their home from foreclosure.
With a Chapter 7 Bankruptcy, many types of debt can be eliminated completely. However, not everyone is eligible to file for Chapter 7 bankruptcy. Multiple factors (such as your income level, family size, medical bills, etc.) determine whether you are eligible for Chapter 7. A Rhode Island attorney experienced with bankruptcy should be able to determine if you’re eligible.
For some people a Chapter 13 Bankruptcy is the best option. People often file for Chapter 13 bankruptcy protection in order to stop foreclosure on their homes. This form of bankruptcy often involves partial repayment of debts over a three- to five-year period.
Since the passage of the new bankruptcy law (the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005), more middle class individuals have been filing for Chapter 13 bankruptcy protection.