Many individuals file for bankruptcy in Rhode Island daily, the reason why everyone does this varies with reasons, from financial recklessness to reasons that are out of their control. The most prominent reasons for filing for bankruptcy are accidental injury, loss of a financial sponsor, unemployment, divorce, and natural disasters. In Rhode Island, there were 1,562 Chapter 7 and 468 Chapter 13 filings in Rhode Island counted in a 12-month period, which came to an end June 30th, 2019.
Chapter 13, bankruptcy is the most used type of bankruptcy. It is called chapter 13 bankruptcy because it is one of the chapters of bankruptcy; it is the most common type of bankruptcy for consumer debtors. The other type of bankruptcy for consumers is chapter 7 bankruptcy. Let’s go into more details of Chapter 13 and Chapter 7 bankruptcy in Rhode Island;
- Chapter 7 vs. Chapter 13 bankruptcy in Rhode Island
- Rhode Island Bankruptcy Means Test
- Rhode Island Chapter 13 and Chapter 7 Plan Payments
- Rhode Island Bankruptcy Exemptions
- Where is the Rhode Island Bankruptcy Court Located?
- Who are the Chapter 13 and Chapter 7 Bankruptcy Trustees in Rhode Island?
- Should I file for Rhode Island Chapter 13 or Chapter 7 Bankruptcy Case?
Chapter 7 vs. Chapter 13 bankruptcy in Rhode Island
Choosing which is best between chapter 7 and chapter 13 bankruptcy can be difficult, and choosing a bad choice can further compound your debt woes. One of the differences between these two is that chapter 13 bankruptcies are usually more expensive and takes a longer time than chapter 7 bankruptcy. Before you’re issued a chapter 7 bankruptcy, you must meet its requirements. Also, a chapter 7 trustee may sell the property if exemptions do not protect it.
For Chapter 13 bankruptcy, you’ll have to pay a little more to the trustee every month to keep the property, during the loan. You may get some discounts on your car payments and mortgage during your Chapter 13 plan, ensure you ask for a discount from your creditors.
Chapter 13 loan allows you to combine your debt, and negotiate a payment plan as single debts, as such, ensure you include all your debt. Another feature of Chapter 13 bankruptcy is that you cannot incur debt, or sell any major asset during this period. Read the Ascend blog to know more about Chapter 13 bankruptcy and other debt relief options.
Rhode Island Bankruptcy Means Test
You must first complete a Means Test. This test will calculate your average monthly earnings for the last six months, and then it will use your average income within those periods to find your annual median income. We built a Chapter 7 means test calculator to help estimate Chapter 7 qualification using information below.
If your median income is less than the average median income on Rhode Island then you’re eligible for a chapter 7 bankruptcy discharge. However, if your average income is higher than the average income of Rhode Island, then you won’t qualify for chapter 7 bankruptcy discharge, except you can prove that your disposable is less than a specific amount. Your disposable income is what’s left after deducting allowed living expenses and the necessary payroll deductions. The data used here are from cases that apply to bankruptcy filed on or after November 1, 2020.
The figures used for means test changes with economic realities. Ensure that you use the latest figures when calculating the means test. The table below should be used for cases filed from the 1st of November, 2020. These are the Rhode Island median income level for households are:
|# of People||Annual Income|
Add $9,000 for anyone that has more than nine household members.
Rhode Island Chapter 13 Plan Payments
Several pieces of information are used to estimate a Chapter 13 payment. The factors that affect how much you pay includes; your recent financial transactions, your disposable income, your non-dischargeable debt, and your nonexempt equity in assets.
You can easily explore your debt relief options by making use of the free online Chapter 13 calculator below that we built. If you want a more detailed calculator that will provide you with more information, and that’s more precise, you should select out a very effective calculator that can estimate you Chapter 13 payments in very few minutes.
Rhode Island Bankruptcy Exemptions
Your net equity can raise your payment in your chapter 13 bankruptcy payments. The bankruptcy exemption in Rhode Island ensures that the borrower does not use net equity to repay unsecured debts like credit card debt and medical expenses.
Rhode Island provides debtors a choice to choose between federal exemptions and state exemptions. The Federal bankruptcy exemptions are often different than the Rhode Island state bankruptcy exemptions.
You will see Rhode Island bankruptcy homestead exemption and other assets exemptionss. Rhode Island may change the rules of their bankruptcy exemptions. Thus, you may need to get in touch with your attorney when you want to file a bankruptcy claim.
Where is the Rhode Island Bankruptcy Court Located?
There is only one district for bankruptcy cases in Rhode Island. As such, any bankruptcy case that is filled in the state must be through that court. You will find the Bankruptcy Court for the District of Rhode Island in Denver, at 721 19th Street. You can call the number of the court during working hours at (Telephone: 720-904-7300). The 341 meeting is a meeting that is arranged by your bankruptcy trustee to ask you some questions under oath. You will be notified by the clerk of court when it’s time for a 341 meeting. The hearing location you’ll be given will be the nearest to your residence.
Who are the Chapter 13 and 7 Trustees in Rhode Island?
There are two trustees in Rhode Island, and each trustee is assigned a case based on the resident of the debtor. Here are the current Rhode Island Chapter 13 Trustees:
|John Boyajian||(401) 223-5550|
If you file for Chapter 13 bankruptcy in Rhode Island, your case will be assigned to one of the two Chapter 13 Trustee. The job of the trustee involves reviewing your monthly claims, reviewing your tax returns, and ensuring every party involved in the bankruptcy plan sticks to the agreement. Here are the current Rhode Island Chapter 7 Trustees:
|Joseph M. DiOrio||(401) 632-0911|
|Stacy B. Ferrara||(401) 828-5800|
|Lisa A. Geremia||(401) 885-1444|
|Charles A. Pisaturo, Jr.||(401) 274-3800|
Should I file Chapter 13 Bankruptcy Case in Rhode Island?
Whether you should file Rhode Island Chapter 7 or Chapter 13 Bankruptcy depends on your financial situation. If you’re neck-deep into debt, then this might be one of the easy ways out. Before filing a bankruptcy case in Rhode Island, you may want to first weigh all the debt relief options before you, as you may have some better alternatives that align with your financial goal.
Some alternatives to chapter 13 bankruptcy are debt settlement, Chapter 7 bankruptcy, and debt consolidation. We implore you to weigh the merits and demerits of each alternative before making your choice. If you find Chapter 13 Bankruptcy is your preferred route out of debt, click here to get started. At Ascend, we’ll guide you on your path to financial freedom.