Bankruptcy is a federal law; in such filing bankruptcy can only be done in federal court. The basic bankruptcy laws are therefore the same throughout the United States, the only variations in the State laws relating to what assets an individual debtor is allowed to keep, called "exemptions" (Texas exemptions are here) There is also variations in the effect of bankruptcy as different states have different durations of bankruptcy.
A bankruptcy starts with the filing in bankruptcy court of the official petition and a lengthy document called a Statement of Financial Affairs. This statement contains extensive information including a detailed list of all your Secured debts (home loans or autoloans - "secured" loans are loans with property as collateral) , Priority debts (this includes taxes), Unsecured debts, contact information for creditors, and a list of debtor assets.
Bankruptcy Laws Texas
You can still file for Chapter 7 bankruptcy under the new laws. However, there wil be a little more effort and paperwork for you and your bankruptcy lawyer to fill out.
Chapter 7 Bankruptcy
A Chapter 7 bankruptcy (straight bankruptcy) is a bankruptcy in which the debtor turns over all non-exempt assets to the bankruptcy lawyer. The bankruptcy lawyer will raise as much cash by selling these assets. After a period of time (usually 3-5 months) the debtor will receive a discharge of all dischargeable debts.
Federal laws provide a means test to determine if you are eligible to file for Chapter 7 Bankruptcy in Texas. If your income is below the median family income in Texas you will be eligible.
Chapter 13 Bankruptcy
The main advantage of Chapter 13 bankruptcy in Texas is you can save your home from foreclosure! (Texas Home Buyers) You must still pay your mortgage payments as laid out by the chapter 13 plan.
Another advantage of a chapter 13 bankruptcy is you get to avoid dealing with creditors! Your bankruptcy lawyer will deal with your creditors for you.
You are eligble to file for chapter 13 bankruptcy in Texas if your unsecured debts are less than $307,675 and secured debts are less than $922,975.
What do I get to keep if I file bankruptcy?
Each state offers different sets of rules of what you can keep if you file bankruptcy. Texas offers a state or federal set of exemptions. The exemptions can be found here
