Best Bankruptcy & Debt Lawyers in South Carolina

About Bankruptcy & Debt Law in South Carolina, United States

Bankruptcy and debt law in South Carolina deals with the legal process and regulations relating to individuals and businesses who are unable to pay their outstanding debts. The main purpose of these laws is to provide relief to debtors, protect their legal rights, and ensure that creditors receive fair treatment. Bankruptcy is governed primarily by federal law, but certain aspects, such as exemptions and procedures, are influenced by local South Carolina statutes. Alternatives to bankruptcy, such as debt settlement or consolidation, are also available, but each option has specific legal implications that residents should understand before proceeding.

Why You May Need a Lawyer

Legal issues involving bankruptcy and debt can be complicated, and a mistake in handling financial matters can have long-term consequences. Common situations in which you may need a bankruptcy and debt attorney include:

• Facing foreclosure on your home
• Being sued by creditors or debt collectors
• Receiving wage garnishment notices
• Considering filing for bankruptcy (Chapter 7, Chapter 13, or Chapter 11)
• Dealing with persistent harassment from debt collectors
• Needing guidance on debt restructuring, negotiation, or settlement
• Wanting to understand the potential impact of bankruptcy on your credit and assets
• Figuring out how state laws interact with federal bankruptcy protections

Local Laws Overview

While bankruptcy is governed by federal law under the United States Bankruptcy Code, South Carolina has specific laws and procedures that you must follow. For example, debtors in South Carolina must use state-specific exemptions, which determine what property you can keep during bankruptcy. Some key points include:

• Exemptions: South Carolina allows certain exemptions to protect your home, vehicle, personal property, retirement accounts, and other assets up to specific values.
• Foreclosure Process: South Carolina is a judicial foreclosure state, which means lenders must go through the courts to foreclose on a home. Bankruptcy can temporarily halt foreclosure proceedings through an automatic stay.
• Chapter Selection: Most individuals file either Chapter 7 (liquidation) or Chapter 13 (reorganization) bankruptcy. The choice depends on income, assets, and financial goals.
• Means Test: To qualify for Chapter 7, you must pass a means test based on income and expenses compared to the state median.
• Debt Collection Protections: Both state and federal laws protect you against abusive debt collection practices. South Carolina also has statutes regarding debt collection agency licensing and conduct.

Frequently Asked Questions

What types of bankruptcy are available in South Carolina?

Individuals usually file Chapter 7 or Chapter 13 bankruptcy. Businesses may also consider Chapter 11 or Chapter 7. Chapter 7 is for liquidating assets to pay creditors, while Chapter 13 involves creating a repayment plan.

Can I keep my house if I file for bankruptcy in South Carolina?

It depends on the amount of equity in your home and whether it falls within South Carolina's homestead exemption. Many people are able to keep their primary residence if exemptions apply and payments are current.

How long does bankruptcy remain on my credit report?

A Chapter 7 bankruptcy stays on your credit report for up to ten years, while a Chapter 13 stays for up to seven years from the date of filing.

What debts can be discharged in bankruptcy?

Most unsecured debts, such as credit card bills and personal loans, may be discharged. Some debts, including certain taxes, student loans, child support, and alimony, are generally not dischargeable.

How does the means test work in South Carolina?

The means test compares your household income to the South Carolina median income for your family size. If it is below the median, you generally qualify for Chapter 7. If it is above, further calculations determine eligibility.

Will filing for bankruptcy stop creditor harassment?

Yes. When you file for bankruptcy, an automatic stay goes into effect, which legally requires creditors and collectors to stop most collection activities and lawsuits immediately.

What property can I keep if I file for bankruptcy?

South Carolina law provides a list of exemptions for equity in your home, vehicle, personal belongings, retirement accounts, and more. If property value is within exemption limits, you may keep it.

Can I file for bankruptcy more than once?

Yes, but there are time limits between filings depending on the type of bankruptcy previously and currently filed. For example, eight years must pass between Chapter 7 filings.

How does Chapter 13 bankruptcy work in South Carolina?

In Chapter 13, you propose a three to five year repayment plan approved by the court. You make regular payments to a trustee, who pays creditors. This can help stop foreclosure and allow you to retain assets.

Do I need an attorney to file for bankruptcy in South Carolina?

While you are not legally required to have an attorney, bankruptcy is complex and mistakes can have serious consequences. Most experts strongly recommend consulting with a qualified bankruptcy attorney.

Additional Resources

If you need more information or assistance, consider the following resources:

• United States Bankruptcy Court - District of South Carolina - The official court handling bankruptcy cases in the state.
• South Carolina Legal Services - Provides free or low-cost legal assistance to eligible residents facing financial hardship.
• South Carolina Department of Consumer Affairs - Offers resources on debt collection, credit, and consumer protection.
• National Foundation for Credit Counseling - A nonprofit network offering credit counseling and debt management resources.
• Local County Bar Associations - Many provide lawyer referral services to help you find experienced bankruptcy attorneys near you.

Next Steps

If you are struggling with debt or considering bankruptcy in South Carolina, act quickly to learn your rights and options. Start by gathering your financial documents, making a list of your debts, income, and assets, and contacting a knowledgeable bankruptcy attorney for a consultation. An attorney can review your situation, explain your options, and guide you through the steps needed to protect your financial future. If you qualify, utilize free or low-cost legal aid services. Remember, taking early action can expand the solutions available and reduce stress. Your path to financial stability can begin with the right guidance and support.