If you live in Dallas and cannot pay your bills as promised, you can seek debt relief assistance through the Consumer Credit Counseling Service of Greater Dallas or the United States Bankruptcy Court Northern District of Texas. Your available options include debt negotiation, budget counseling and partial or complete personal bankruptcy.
Financial Counseling
Nonprofit organizations such as the Consumer Credit Counseling Service of Greater Dallas offer financial counseling to people for a nominal fee. Even if you know you want to file bankruptcy, you still need financial counseling before you can legally file a case. The session will help you determine whether you have exhausted all available options to repay your debts, including slashing your household budget or negotiating with your creditors.
Debt Management Plans
Your Dallas credit counselor may help you qualify for a debt management plan. Under this plan, you would pay one lump-sum monthly payment to your selected credit counselor. He would distribute it to your creditors as agreed. While people can sometimes renegotiate their debts without a credit counselor's help, it can be stressful and difficult to do so.
Chapter 7 Bankruptcy
Chapter 7 bankruptcies in Dallas must be filed with the United States Bankruptcy Court Northern District of Texas. Under Chapter 7, a Dallas bankruptcy judge will discharge your obligations to repay most pre-existing debts unless he feels you were dishonest to the court or your creditors. Generally, you must earn less than the state's annual median income level to qualify for Chapter 7; if you earn more money, you can get special permission to file if you prove an inability to partially repay creditors and support your family. As of 2011, the annual median income for a single Texas resident was $38,801, while the yearly level for a family of two was $55,660, according to the U.S. Trustee Program. Families of four could earn up to $66,145 per year.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy enables Dallas residents to partially repay debts over three to five years. This type of case negatively impacts credit ratings for seven years as opposed to 10 years in Chapter 7. But you cannot include every debt in any type of bankruptcy case. Ineligible debts include child support, alimony, recent tax debts, most federal student loans, court fines and any bills related to a crime.
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