Lynch & Belch, P.C.Indianapolis Bankruptcy Lawyers | Chapter 7, 132026-05-28T17:56:33Zhttps://www.lynchandbelchbankruptcy.com/feed/atom/WordPressOn Behalf of Lynch & Belch, P.C.<![CDATA[Record car loan defaults indicate financial instability]]>https://www.lynchandbelchbankruptcy.com/?p=484002026-05-28T17:56:33Z2026-05-28T17:56:33ZEarlier this year, reports came out indicating that car loan delinquency rates had hit record levels. They are as high today as they have been in 32 years, with previous levels of car loan defaults not having been seen since 1994.
These reports looked at subprime borrowers. They also considered those who were 60 or more days behind on making their payments, so they did not include people who had just accidentally missed a single payment. These were borrowers who were unable to pay.
A red flag for the economy
To some degree, this issue is about car loans specifically. For instance, the average monthly payment in 2026 is $774. It is much more than has been paid in previous decades, and it shows that owning a car is just getting more and more expensive.But on top of that, many people look at these reports as a red flag for the overall American economy. It could indicate that bankruptcy filings will rise in the near future.After all, many people are dependent on their cars and prioritize paying off car loans. They will miss other payments, such as credit card payments, before missing that car payment. So when you see the number of car loan delinquencies rise so substantially, it means many of those borrowers are also running into financial instability in other areas of their lives.
Your bankruptcy options
Have you found yourself facing high levels of debt and are unsure how to proceed? It may be time to look into your legal options, such as using bankruptcy to get a fresh financial start.
]]>On Behalf of Lynch & Belch, P.C.<![CDATA[Is property liquidation necessary during Chapter 7 bankruptcy?]]>https://www.lynchandbelchbankruptcy.com/?p=483992026-05-19T10:51:06Z2026-05-19T10:51:06ZMost filers can avoid liquidation entirely
Contrary to what people frequently assume, asset liquidation is not mandatory. Those filing for personal bankruptcy can exempt assets using property protections enshrined in Indiana state law. Indiana does not allow filers to use federal exemptions, but state exemptions cover many forms of property.
Exemptions allow people to preserve most, if not all, important resources during a divorce. Home equity, vehicle equity, house furnishings, trade tools and even retirement savings are potentially exempt from asset liquidation requirements.
Filers who prepare thoroughly with a lawyer have the best chance of optimizing their use of bankruptcy exemptions and preserving their resources. While liquidation is mandatory in cases where filers cannot exempt all of their assets, most people who pass the means test also have personal holdings that fall below the threshold for full exemption during a Chapter 7 bankruptcy.
Reviewing an inventory of resources with a lawyer can help those considering a Chapter 7 bankruptcy filing determine if they are at risk of asset liquidation. The right approach to bankruptcy can maximize financial relief while minimizing any risks associated with the process.
]]>On Behalf of Lynch & Belch, P.C.<![CDATA[Why do cancer survivors often file for bankruptcy?]]>https://www.lynchandbelchbankruptcy.com/?p=483982026-04-30T08:33:21Z2026-04-30T08:33:21ZMore than half of all cancer survivors finish treatment with substantial medical debt, and a significant portion of them eventually file for bankruptcy. Why is bankruptcy so common among cancer survivors?
Insurance gaps lead to big bills
Medical debt can accrue rapidly when a person requires cancer care. The treatment regimen may extend over more than one year, resulting in a patient needing to pay a large deductible two or even three times before they achieve remission.
Then there is the coinsurance to consider. Many modern insurance policies require that patients pay a flat percentage of their total care costs. A 20% coinsurance for cancer treatment could translate to dollars.
Some of the newest and best drugs may not be eligible for insurance coverage at all. Finally, the inability to work while undergoing treatment can increase the financial pressure on cancer patients.
Instead of letting debt collection stress affect a cancer survivor's health, a prompt bankruptcy filing can be beneficial when medical creditors start calling or file a debt lawsuit. Reviewing bankruptcy options with a skilled legal team when a medical creditor attempts to file a lawsuit could help cancer survivors move on with their lives instead of facing years of hardship after their medical battle.]]>On Behalf of Lynch & Belch, P.C.<![CDATA[Which bankruptcy chapter stops Indiana foreclosure better?]]>https://www.lynchandbelchbankruptcy.com/?p=483972026-04-27T09:57:21Z2026-04-27T09:57:21ZFacing an Indiana foreclosure is one of the most difficult financial situations a parent can encounter. The prospect of losing your home and uprooting your children's lives can feel overwhelming. If you are behind on mortgage payments, filing for bankruptcy may help you halt the proceedings. However, Chapter 7 and Chapter 13 each operate under very different provisions. This is why understanding those distinctions helps you choose the option that best safeguards your family.
How chapter 7 offers short-term protection
Chapter 7 is often the first option people consider. Hence, knowing what it can and cannot do is a good place to start. Filing for Chapter 7 bankruptcy usually triggers an automatic stay. This court order immediately suspends all collection actions, including foreclosure proceedings. It gives you a temporary reprieve from the threat of losing your home. However, Chapter 7 does not eliminate your mortgage obligation. Once the court lifts the automatic stay, the bank can resume the foreclosure. If you cannot pay the missed payments right away, the lender will likely proceed with the sale. So, chapter 7 proves most effective if you need short-term relief but do not plan to keep your home.
How chapter 13 lets you fight to stay home
On the other hand, Chapter 13 offers a more structured and long-term solution for parents who want to remain in their home. This option allows you to establish a court-approved repayment plan that distributes your mortgage arrears over three to five years. This way you can continue making your regular mortgage payments while gradually resolving what you owe. As long as you adhere to the plan, the bank cannot foreclose on your home. However, there is one important condition. You must file for Chapter 13 before the court confirms the foreclosure sale. This is why time is a critical factor if you choose this type of bankruptcy filing.
The right choice depends on your situation
With both options now on the table, the focus shifts to what aligns with your specific financial circumstances. Your income, your total debt and how far behind you are on your mortgage all shape which path makes more sense for your family. Every situation is unique and developing a comprehensive view of your finances makes it easier to move forward with confidence. The more clearly you understand your options, the better you can choose the path that keeps your children in the home they know.]]>On Behalf of Lynch & Belch, P.C.<![CDATA[Common myths about filing for bankruptcy]]>https://www.lynchandbelchbankruptcy.com/?p=483962026-04-21T14:02:04Z2026-04-21T14:02:04ZFor many people, the idea of filing for bankruptcy is filled with uncertainty and misinformation. Unfortunately, it’s these myths that prevent people from exploring an option that can provide them with financial relief.
Bankruptcy is a legal process that can help you regain control of your finances, and knowing what is and isn’t true can make a meaningful difference in how you choose to move forward.
Myth 1: Filing for bankruptcy means you failed financially
One of the most persistent myths is that bankruptcy is a personal failure. The reality is that many people turn to bankruptcy due to circumstances beyond their control, such as job loss,medical expenses or other unexpected life events.Bankruptcy is not a reflection of who you are as a person. It’s a legal and practical step toward rebuilding.
Myth 2: You will lose everything
Another common fear is that filing for bankruptcy means you will lose everything you own, including your home, car and personal belongings. In most cases, this isn’t true.Indiana law provides exemptions that allow you to protect certain property, including equity in your home, a vehicle, retirement accounts and everyday household items. You will likely be able to keep the items that mean the most to you.
Myth 3: Bankruptcy permanently damages your credit
Bankruptcy will indeed impact your credit, but it’s not permanent. In fact, you may be able to begin rebuilding your credit sooner than expected. And because bankruptcy can eliminate or reduce overwhelming debt, you may actually begin to improve your financial position over time. With good financial habits, some filers begin seeing an improvement in their credit score within a year or two.Believing these myths can prolong your financial hardship, whilefiling for bankruptcy can provide a clear path toward financial stability. To determine if bankruptcy is the right solution for you, it’s best to speak with someone who can evaluate your situation, explain your options and guide you through the process.]]>On Behalf of Lynch & Belch, P.C.<![CDATA[What to do with medical debt after your hospital stay]]>https://www.lynchandbelchbankruptcy.com/?p=483952026-03-26T08:36:35Z2026-03-28T05:00:38ZSteps to take that can help you regain financial control
Medical bills can feel overwhelming at first, especially when they arrive from different providers. You can take these steps to bring order to the situation:
Review your charges carefully: Ask for an itemized statement and check each entry. This step helps you identify duplicate charges, billing errors or services you did not receive.
Speak with the billing office about possible reductions: Contact the provider and ask if they can lower the total amount. Some hospitals reduce balances when patients can make a partial upfront payment.
Set up a structured payment plan that fits your budget: Request monthly installments instead of paying everything at once. Many providers offer low- or no-interest plans that make repayment more manageable.
Apply for financial assistance as early as possible: Under federal regulations, nonprofit hospitals are required to offer aid programs. Apply as soon as possible since important deadlines can run within months of the first bill.
Keep written records of every agreement you make: Ask for confirmation of payment terms, adjustments and approvals. Clear documentation helps you avoid confusion and resolve disputes if they arise.
Beyond these steps, state law can also shape how medical debt is handled. As of January 29, 2026, Indiana lawmakers have advanced a Senate Bill. They have sent it to the House for further consideration, where it remains pending and has not been enacted into law. The proposed changes would protect certain lower-income patients by restricting wage garnishment. These legal developments highlight why timing and awareness matter.
How early action can safeguard your options
Addressing the issue sooner can give you more time to review charges, ask questions and document each response. It also helps to avoid confusion that often grows when accounts move deeper into collections.
When the balance becomes difficult to manage or when bills remain unpaid, medical debt may also become part of a larger discussion about Chapter 7 bankruptcy. This legal path can discharge many types of qualifying unsecured debt, including medical bills in most cases. If you plan carefully, you may evaluate each option with a clearer view of your finances.]]>On Behalf of Lynch & Belch, P.C.<![CDATA[What are your bankruptcy options in Indianapolis?]]>https://www.lynchandbelchbankruptcy.com/?p=483912026-03-23T15:44:42Z2026-03-23T15:44:42ZChapter 7 bankruptcy: "Liquidation"
Chapter 7 eliminates most unsecured debts, including credit cards and medical bills, typically within four to six months. To qualify, you must pass the Means Test based on Indiana's median household income.
Pros:
Fast relief: Discharges eligible debt in months.
Asset protection: Protect equity in assets like your home (up to $22,750) and car (using the $12,100 wildcard exemption) under Indiana law.
Cons:
Credit impact: Stays on your credit report for a statutory maximum of 10 years from the date of filing and significantly lowers your score.
Income limits: Usually for lower-income individuals, though higher earners with specific allowable expenses or business debts may still qualify.
Non-dischargeable debts: Child support, alimony and recent taxes cannot be discharged. Student loans are also extremely difficult to discharge, requiring you to legally prove "undue hardship" in court.
Chapter 7 may be ideal if you have limited income, require expedited debt relief and can accept the long-term credit ramifications for an immediate fresh start.
Chapter 13 bankruptcy: "Reorganization"
Chapter 13 establishes a three to five year court-approved repayment plan. It is designed for individuals with consistent income who wish to repay debt incrementally.
Pros:
Asset preservation: Keep your home and car and immediately stop foreclosures or repossessions.
Catch up: Pay off mortgage, vehicle, tax and child support arrears over time.
Credit reporting: While federal law permits reporting for 10 years, the three major credit bureaus remove Chapter 13 filings seven years from the filing date, regardless of whether the case was completed.
Cons:
Time commitment: It requires three to five years of monthly payments under court supervision.
Income requirement: You must have a steady income to qualify.
Credit impact: Still significantly damages your credit score.
Chapter 13 could be your optimal choice if you have a steady income, wish to protect valuable assets such as your home or vehicle and prefer a methodical approach to becoming debt-free.
Making an informed decision
Chapter 7 offers rapid debt elimination for lower-income individuals seeking an immediate fresh start, while Chapter 13 provides a structured repayment strategy for those with steady income who want to preserve assets. Both significantly impact your credit, but many individuals rebuild successfully within two to three years through disciplined financial habits.
Understanding these fundamental differences helps you determine the appropriate path for your financial situation.
]]>On Behalf of Lynch & Belch, P.C.<![CDATA[Can self-employed people in Indiana file for bankruptcy?]]>https://www.lynchandbelchbankruptcy.com/?p=483902026-02-27T15:13:58Z2026-02-27T15:13:58ZSelf-employed individuals are eligible to file
Federal law governs bankruptcy, and it applies uniformly in Indiana as it does everywhere else. The legal criteria for debtors delineate a narrow list of parties who cannot file: financial institutions, railroads and insurance companies. Self-employed individuals are not on that list. Freelancers, sole proprietors and independent contractors are also not excluded from filing.
The two most common options are Chapter 7 and Chapter 13, and which one makes sense depends on your situation.
Could Chapter 7 be the right move?
Chapter 7 is a liquidation bankruptcy. It allows eligible individuals to discharge qualifying debts without a repayment plan. Common dischargeable debts include medical bills, credit cards and personal loans, as well as business debts you personally assumed.
To file for Chapter 7, you need to pass the means test. It compares your income to Indiana's median income for your household size. For self-employed filers, that income figure is not your total revenue. You subtract your legitimate business expenses first. The lower that number, the better your chances of qualifying.
The tradeoff is that Chapter 7 does not keep a business running. If staying open matters to you, Chapter 13 may be worth considering.
Could Chapter 13 help you keep working?
Chapter 13 bankruptcy provides a structured path to repay outstanding obligations over three to five years without surrendering your assets, including your business. Creditors cannot pursue you while the plan is active. Whatever eligible debt remains at the end of the repayment period gets discharged.
The requirement is that your income be consistent enough to sustain the payments. For self-employed filers with irregular earnings, that can be a real consideration.
What to expect as a self-employed filer
The financial profile of a self-employed individual is more intricate than a standard filing. The distinction between personal and business finances is rarely clear-cut, and income fluctuates in ways that complicate the calculations. Deductible business expenses and outstanding financial obligations all require precise documentation to get right.
Neither chapter is better than the other. The appropriate path depends on your income, your liabilities and what you want your situation to look like on the other side.]]>On Behalf of Lynch & Belch, P.C.<![CDATA[Can I keep my utilities on during Chapter 7 bankruptcy?]]>https://www.lynchandbelchbankruptcy.com/?p=483882026-02-26T09:23:51Z2026-02-26T09:20:37Z"Will bankruptcy leave us sitting in the dark?" is a common worry for those facing extreme financial hardship in Indiana. This legal tool, after all, is designed to address debts you cannot pay, and utility bills often fall into that category. The good news is that federal law provides valuable protections to keep your essential services running during Chapter 7.
Immediate protection through the automatic stay
The moment you file your bankruptcy petition in Indiana, a court order called the automatic stay takes effect. This order stops most collection actions, including utility disconnections for past-due balances. The automatic stay prevents utility providers, including municipal and private companies, from disconnecting your gas, electric or water services. the provider must typically restore it immediately upon notification of the filing.This protection, however, is temporary and requires you to take specific steps to maintain long-term access to essential services .
Adequate assurance may be necessary
While utility providers cannot disconnect you for old debts, they can request adequate assurance of payment for future usage. Adequate assurance typically includes:
A security deposit, usually equal to about two months of service or, in some Indiana districts, three times your average monthly bill
A guarantee from another person who agrees to pay if you fail to do so
A documentation showing you can pay your current bills on time
An agreement to prepay for upcoming utilities
Utility companies must make the request for adequate assurance within 20 days of your bankruptcy filing. You then have 20 days after receiving the request to provide the assurance or pay the new security deposit.Missing this deadline generally gives companies legal grounds to move forward with a disconnection without asking the court for further permission.
Addressing pre-petition vs. post-petition debt
Chapter 7 bankruptcy treats your utility bills differently depending on when you used the service.
Pre-petition debt: This includes any balance you owed before your filing date. The court typically discharges these amounts, meaning you are no longer legally obligated to pay them.
Post-petition debt: This refers to any service you use after the day you file. You must pay these new bills on time to avoid future shutoffs.
Bankruptcy wipes out the old burdens but requires you to stay current on new expenses. A structured plan can help you maintain a functional home while your case moves forward.
Pursuing bankruptcy with confidence
The primary goal of bankruptcy is to wipe the slate clean by eliminating overwhelming debt. This legal process balances your creditors' interests with your right to keep your household on solid ground. By complying with the rules, you ensure that your path to financial recovery remains clear and stable.]]>On Behalf of Lynch & Belch, P.C.<![CDATA[Can Chapter 13 discharge IRS tax penalties?]]>https://www.lynchandbelchbankruptcy.com/?p=483832026-01-26T08:40:56Z2026-02-16T16:00:05ZTax debt can be a big hurdle, especially when penalties and interest continue to grow. If you owe the Internal Revenue Service (IRS), you may wonder whether Chapter 13 bankruptcy offers some relief and how it compares to Chapter 7. While results often depend on your circumstances, understanding the general differences can help you form realistic expectations.
How Chapter 13 treats IRS tax debt
Chapter 13 focuses on repayment over time rather than quick discharge. You propose a payment plan that usually lasts three to five years. During that period, you make monthly payments based on your income and reasonable living expenses. Those payments can go toward many types of debt, including certain tax obligations.When IRS debt is involved, Chapter 13 often divides what you owe into categories. Recent income taxes often require full payment through the plan. Older income taxes may qualify for partial repayment or discharge if they meet specific timing rules under federal bankruptcy law. Penalties, however, often receive more flexible treatment than the tax itself.
What happens to IRS tax penalties
Tax penalties often follow different rules than the underlying tax debt. In many Chapter 13 cases, penalties, even those tied to more recent taxes, fall into the same group as general unsecured debts such as credit cards or medical bills. As a result, you may pay only a portion of the penalty amount through your plan and any unpaid balance may go away once the plan ends.Chapter 13 may also help stabilize your situation in other ways. For example, interest and penalties often stop adding up after you file, which can make the total balance easier to manage over time.
How Chapter 13 compares to Chapter 7
Chapter 7 works differently and usually moves much faster. It focuses on eliminating qualifying debts within a few months rather than spreading payments over years. While some older income taxes and related penalties may qualify for discharge in Chapter 7, penalties tied to recent taxes often remain.Several differences often stand out:
Time frame: Chapter 13 uses a multi year payment plan, while Chapter 7 typically moves faster.
Payment structure: Chapter 13 allows gradual repayment, while Chapter 7 does not involve a repayment plan.
Penalty treatment: Chapter 13 may allow more flexibility with certain tax penalties than Chapter 7.
Weighing your options carefully
Deciding between Chapter 13 and Chapter 7 involves more than tax penalties alone. Your income, assets and overall debt picture can all influence how each option works for you. Federal bankruptcy law and IRS rules may affect outcomes, so results can vary. Learning how chapter 13 generally operates may help you consider which approach better supports your financial goals and long term stability.]]>