Personal chapter 7 bankruptcy to discharge credit card debt while a sole proprietor in SC
Used personal cc for sole proprietor business start up in south carolina with 6 used tan beds and used gym equipment- total value resale value about $5000. I Rent an apartment and own 1992 car. Business income 50% less than last year. I am below the median income for my area.
If I file for bankruptcy would chapter 7 or chapter 13 be better for me. The business has no debt- the debt I have is on personal credit cards.
—Tammy
Based on what you shared so far, chapter 7 bankruptcy is going to be the clear option of choice. This would allow you to discharge the credit card debts.
The big issue will be the fact that you own the beds and gym equipment. How much, or whether those items are going to play into whether you can keep the doors open is a question for a bankruptcy attorney. I can tell you that the “tools of trade” exemption is based on South Carolina rules and is less than half of the 5k you valued the equipment at.
That does not necessarily mean you could not still proceed with a chapter 7 and stay open for business.
There may be some creative ways that an attorney can help you use the cash and liquid asset exemptions in the South Carolina chapter 7 bankruptcy rules in order to hold onto the business. There are some other concerns I may have. My questions:
What are the amounts of the credit card debts and who are the banks?
When did you last use the cards to make a purchase?
When did you last make a payment on your credit cards?
If you can answer those questions in a comment reply I can offer some more feedback and perhaps some cautions.
About Michael BoveeMichael started CRN in 2004 with a mission to provide people in need with detailed debt and credit help and education. Michael has participated as an expert panelist in federal consumer protection rule making, collaborated on state law changes governing debt consolidation, has worked as an expert witness in court matters related to the debt relief industry, and is a regular contributor to several personal finance websites.
