You may have experienced a financial hardship and are not considering bankruptcy. Perhaps you do estimated that you will qualify for a Chapter 7 bankruptcy after taking a Chapter 7 Means Test Calculator or your assets exceed the Georgia bankruptcy exemptions. Filing Chapter 13 in Georgia may be the best way for you to solve a debt problem. When you do not have the money to pay your debts each month, the situation can be frustrating and stressful. However, seeking help through the bankruptcy court can give you a fresh start, free from debts you cannot pay.
The purpose of this article is to provide as much detail as possible to help you decide whether to file a Chapter 13 bankruptcy in Georgia. We will cover many different areas, but the article’s purpose is to skip around to what’s best for you.
Understanding a Chapter 13 Bankruptcy in Georgia
- Chapter 13 vs. Chapter 7
- Georgia Chapter 13 Means Test
- Chapter 13 Plan Payments in Georgia
- Georgia Bankruptcy Exemptions
- Where are Georgia Bankruptcy Courts Located?
- Who are the Georgia Chapter 13 Trustees?
- Do I Have Alternatives to Filing Chapter 13?
What is the difference between Chapter 7 and Chapter 13 in Georgia?
To obtain a bankruptcy discharge (debt forgiveness) in a Chapter 7 bankruptcy, you must meet income requirements to file under Chapter 7. Chapter 7 bankruptcy cases are often referred to as “liquidation” bankruptcy cases. A Chapter 7 trustee analyzes the debtor’s (the person who filed the bankruptcy case) property to determine if the Chapter 7 trustee can sell the property at a bankruptcy auction. The proceeds from the sale are used to pay the debtor’s unsecured creditors.
However, a Chapter 13 bankruptcy case restructures your debts into a bankruptcy repayment plan. Instead of paying unsecured creditors (i.e. credit card debt, medical bills, and personal loans) the full balance owed on the account, you pay a small percentage of the debt. Once you complete your Chapter 13 plan, these debts are discharged or forgiven.
You are not able to get rid of some debts in bankruptcy. However, through a Chapter 13 plan, you can repay many of these debts in full over three to five years. Priority unsecured debts that must be paid in full in a Chapter 13 or Chapter 7 case include alimony, child support, and most taxes. You must also pay any back mortgage payments in full if you want to keep your home.
The bankruptcy stops foreclosures, repossessions, wage garnishments, and debt-collection lawsuits. A Chapter 13 bankruptcy case allows you to keep your home and your vehicle by giving you more time to catch up the payments. If you want to learn more about the Chapter 13 process, read our Guide to Chapter 13.
Georgia Means Test
The Chapter 13 Means Test is a bankruptcy form used to calculate your average income and your disposable income. Disposable income is the amount of money left over each month after paying allowable living expenses. The information in the Means Test is used when calculating your Chapter 13 plan payment.
All income during the past six months is used to calculate your average monthly income (AMI). Income used for the Means Test includes, but is not limited to, income from wages, salaries, commissions, businesses, rentals, domestic support payments, interest, pensions, retirement income, and other earned income. Social Security Act income does not need to be included in the Means Test. Your average monthly income is multiplied by 12 to calculate your annual average median income. You can use our simple calculator below to help you determine your average monthly income then compare that to the table below. We can also do these calculations for you in our Chapter 7 Calculator.
The Means Test compares your average median income to the average income for households of your size in Georgia. The figures for the Means Test are adjusted based on current information from the Internal Revenue Service and the Census Bureau. Make sure you use the most current figures when completing the Means Test. The most recent figures for the Georgia Means Test are for bankruptcy cases filed on or after April 1, 2020. You have to add $9,000 for each family member to the annual median income if your household size is above 9 people
|# of People||Annual Income|
If your median income is more than the Georgia median income level, you must commit to a five-year Chapter 13 plan. If your median income is below the state median income level, you may qualify for a three-year bankruptcy plan. Although, you can choose a five-year plan to stretch out your payments, if necessary.
What is my estimated Chapter 13 Plan Payment in Georgia
Your Georgia Chapter 13 plan payment depends on several factors.
- Mortgage Arrearage — You must catch up on the balance of past due mortgage payments to keep your house in Chapter 13. You pay your normal mortgage payments outside of the plan.
- Car Loans — You may have several options for paying a car loan. If you meet certain requirements, you can lower your car loan payments in Chapter 13. Typically, most debtors pay their car loans in full through the Chapter 13 plan to save money.
- Priority Unsecured Debts — These debts must be paid in full through your Chapter 13 plan. They include back taxes, alimony, child support, most debts owed to the government, restitution, and administrative amounts (amount owed to the Chapter 13 trustee for administering the case).
- Non-exempt Assets — If any assets have non-exempt equity, you must pay an amount equal to the non-exempt equity to your unsecured creditors.
- Disposable Income — You must pay an amount equal to your disposable income to your unsecured creditors.
There may be other factors that impact the amount of your Chapter 13 plan. If you want to estimate your Georgia Chapter 13 plan payments, use our Chapter 13 Calculator below:
Georgia Bankruptcy Exemptions
Bankruptcy exemptions protect the net equity in your property from being used to increase your Chapter 13 plan payment. Georgia has opted out of the federal bankruptcy exemptions. If you have resided in Georgia for at least 730 days before filing your Chapter 13 petition, you must use Georgia bankruptcy exemptions.
The exemptions cover a wide variety of property, including, but not limited to, homes, vehicles, clothing, personal property, business equipment, retirement accounts, and health aids. Married couples who file Chapter 13 in Georgia can double the exemption amounts if both spouses own an interest in the property.
Georgia bankruptcy exemptions are found in GA Code §44-13-100. The exemption amounts may be adjusted periodically. Therefore, you must have the most current figures for Georgia bankruptcy exemptions when you begin to calculate your bankruptcy plan.
Where are Georgia Bankruptcy Courts Located?
Because Georgia is a large state with a high population, the state is divided into three bankruptcy districts. You may learn more about the three districts below.
- The Northern Bankruptcy District of Georgia has four divisions located in Atlanta, Gainesville, Newnan, and Rome. Each division serves counties in the surrounding areas.
- The Middle Bankruptcy District of Georgia is headquartered in Macon and serves 70 Georgia counties. A staffed bankruptcy court is also located in Columbus. Other locations are only staffed when hearings are held.
- The Southern Bankruptcy District of Georgia has six divisions. The six divisions are Augusta, Statesboro, Savannah, Brunswick, Waycross and Dublin. Only Savannah, Augusta, and Brunswick have staffed bankruptcy offices.
Your county of residence determines in which district and division your bankruptcy case is filed.
Who are the Georgia Chapter 13 Trustees?
Chapter 13 trustees are assigned to each of the three bankruptcy districts in Georgia. A Chapter 13 bankruptcy trustee administers the bankruptcy estate. The trustee reviews all bankruptcy forms, reviews bankruptcy claims, receives bankruptcy payments, and pays creditors.
The Georgia Chapter 13 trustees are:
|Middle||Camille Hope||(478) 742-8706|
|Middle||Anne Kristin Hurst||(706) 327-4151|
|Northern||Melissa J. Davey||(678) 510-1444|
|Northern||Mary Ida Townson||(404) 525-1110|
|Northern||Nancy J. Whaley||(678) 992-1201|
|Southern||Huon Le||(706) 722-5511|
|Southern||Marie Elaina Massey||(912) 466-9787|
|Southern||O. Byron Meredith||(912) 234-5052|
Common Georgia Chapter 13 Bankruptcy Questions
Below we have tried to tackle some of the more common questions that you may have about filing a Chapter 13 bankruptcy.
How much does it cost to file a Chapter 13 in Georgia
The cost to file a Chapter 13 in Georgia is $310. This $310 fee includes a $235 filing fee and a $75 administrative fee. Below shows the fee breakdown. This does not include attorney fees. Attorney fees can range up to $4,000 – $5,000. These fees are often included in the monthly payment plan.
How do I file Chapter 13 in Georgia?
You would have to complete the following steps to file a Chapter 13 bankruptcy in Georgia.
- Determine which bankruptcy type is best for you.
- Determine whether to hire an attorney.
- Complete Your Credit Counseling Course
- Complete the Remaining Bankruptcy Forms
- Calculate Your Chapter 13 Bankruptcy Plan
- Filing Your Chapter 13 Bankruptcy Case
- Assignment of Trustee and 341 Hearing
- Confirmation Hearing
- Complete Your Debtor Education Course
- Continue Making Your Chapter 13 Payments
How often can you file Chapter 13 in Georgia?
You are able to file another Chapter 13 bankruptcy case after 2 from past Chapter 13 bankruptcy discharge. You can see how often you can file for another type of bankruptcy by learning more about the 2-4-6-8 rule.
Do I Have Alternatives to Filing Chapter 13?
You may qualify to file under Chapter 7 of the Bankruptcy Code if you meet income requirements. However, if you want to save your home from foreclosure, owe more on your car loan than your car is worth, have non-exempt property, or owe debts that are not dischargeable in bankruptcy, a Georgia Chapter 13 bankruptcy case may be best.
Bankruptcy may not be your only alternative for debt relief. You might want to explore debt settlement or debt consolidation. Ascend has a Guide to Debt Settlement and a Guide to Debt Consolidation that provides information about these two types of debt relief. The video below should help summarize a Chapter 13 bankruptcy in Georgia.
If you have questions about bankruptcy and debt-relief options, contact Ascend. We provide resources and information to help you explore your options and choose a debt-relief option that is right for you.