Military Bankruptcy Attorney in Killeen, TX

The economic climate over the past decade has caused record numbers of people to file for bankruptcy as a means to regain control over their debt. To make a situation that is already difficult all the more complicated, members of the military must consider a whole range of special concerns before filing for bankruptcy relief.

Our offices in Killeen are located just miles from the entrance of Ft. Hood, and our military bankruptcy attorney has experience counseling service members, veterans, and military contractors who are struggling with their finances. My Killeen legal team and I are honored to lend a hand to the people serving our country who are now struggling through financial issues.

Special Considerations for Military Bankruptcy in Killeen

To help people living in Killeen better understand some of the special concerns that will need to be taken into consideration during military bankruptcy, I have collected the following information about what the process entails:

Dischargeable Debt and Involuntary Allotments

Each of the four types of bankruptcy has its own specific rules and requirements that must be met by people in Killeen. Chapter 7 and Chapter 13 will be available to most people and most small businesses in and around Killeen. People who fall under Chapter 7 or Chapter 13 protection may be able to discharge the debt they owe to Military Star or AAFES. Chapter 7 and Chapter 13 can also be used to stay any involuntary allotments initiated by Military Star or AAFES. Accordingly, these involuntary allotments must be removed from the individual’s paycheck (LES).

Learn About the Servicemembers Civil Relief Act

Security Clearance

Bankruptcy may affect the status of your military clearance. However, you should know that the deciding party will also consider the factors that caused you to file for bankruptcy, your job performance, the relationship you have with your chain of command, and a number of other factors.

There is a chance that your debt may affect the status of your security clearance even if you do not file for bankruptcy. Bearing that in mind, it may be in your best interest to exercise your constitutional rights and file for bankruptcy to deal with your financial issues. Bankruptcy is a responsible and legally guaranteed means to regaining control over your debt.

Even if the status of your security clearance is affected by your bankruptcy, it will not necessarily be permanent. One of the clients our firm recently represented, a soldier from Ft. Hood, had debt that was so severe that his security clearance privileges were revoked altogether. Once we were able to help him work through the process of bankruptcy—his debts were fully and legally discharged—we were able to successfully advocate for the reinstatement of his security clearance privileges. It’s difficult to describe how happy our client was to have his clearance fully reinstated!

Congress made significant amendments to the Bankruptcy Code in 2005. As part of those changes, disabled veterans now receive special considerations that help to make Chapter 7 bankruptcy more accessible to veterans and active members of the military alike. Under these new guidelines, disabled veterans who incurred their debt during active duty in the military or homeland defense are essentially guaranteed to be eligible for Chapter 7—the court will not be able to convert the case to Chapter 13.

Chapter 7 Bankruptcy Eligibility

In many cases, bankruptcy courts consider the call of a servicemember to active duty to constitute a “special circumstance” that will make the servicemember eligible for Chapter 7 relief. As such, members of the reserve components of the armed forces and members of the National Guard will also be eligible for this special relief under Chapter 7. Under this amended Bankruptcy Code, your income over the six months previous to filing will be compared to the income of others of a similarly sized household as determined by the U.S. Census. If your income is less than the median income of others, you will almost certainly be eligible for Chapter 7 relief. However, even if your income is more than the median income of similar households, you may still be eligible for Chapter 7 relief, though the necessary forms are more complex.

Consult with our Bankruptcy Firm in Killeen

It is important to remember that bankruptcy is a perfectly legal and responsible way to bring your finances back under control. In fact, there is no shortage of notable Americans—President Lincoln and Walt Disney included—who chose to file for bankruptcy as a means to deal with their debt. That being said, bankruptcy is still very serious for anyone filing in Killeen. I understand what will be at stake for you, and I may be able to help you find relief for your financial issues. If you are interested in discussing your options in greater detail, please call the Killeen offices of Erin B. Shank, P.C., at (254) 296-1161 today.