Personal Bankruptcy in Georgia
Overwhelmed by debt? Georgia law gives you a way out.
What Is Personal Bankruptcy in Georgia?
Personal bankruptcy — also called consumer bankruptcy — is a federal legal process that allows individuals to either eliminate or restructure their debts under court protection. When you file for bankruptcy in Georgia, an automatic stay immediately goes into effect, which legally requires all creditors to stop collection efforts, including phone calls, lawsuits, wage garnishments, and bank levies.
Georgia residents filing personal bankruptcy have two primary options: Chapter 7 and Chapter 13. The right choice depends on your income, the type of debt you carry, and your financial goals.
Chapter 7 Bankruptcy — Liquidation (Fresh Start)
Chapter 7 is the most common form of personal bankruptcy filed in Georgia. It is designed for people who have limited income and overwhelming unsecured debt like credit cards, medical bills, and personal loans.
- Most cases completed in 3 to 6 months
- Eliminates credit card debt, medical bills, personal loans, and certain judgments
- Must pass the Georgia bankruptcy means test to qualify
- Most filers keep all of their property due to Georgia’s bankruptcy exemptions
- Stays on credit report for 10 years
Chapter 13 Bankruptcy — Repayment Plan (Save What You Own)
Chapter 13 is ideal for people who have a regular income and want to catch up on mortgage payments, car loans, or other secured debts while keeping their property.
- Creates a 3 to 5 year repayment plan
- Allows you to stop foreclosure and save your home
- Lets you keep non-exempt property you would lose in Chapter 7
- Can eliminate or reduce certain debts not dischargeable in Chapter 7
- Stays on credit report for 7 years
Stopping Wage Garnishment in Georgia Through Bankruptcy
One of the most immediate and powerful benefits of filing bankruptcy in Georgia is the automatic stay — a court order that takes effect the moment you file. This means:
- Your employer must immediately stop garnishing your wages
- Creditors cannot continue lawsuits or obtain new judgments against you
- Bank levies and account freezes must stop
- Repossession attempts are halted
If your wages are currently being garnished in Georgia, filing bankruptcy can stop it within 24 to 48 hours. Georgia law allows creditors to garnish up to 25% of your disposable earnings — filing bankruptcy puts an immediate end to that.
Eliminating Credit Card Debt in Georgia Through Bankruptcy
Credit card debt is one of the most common reasons Georgians file for bankruptcy. High interest rates, late fees, and minimum payments that barely touch the principal can trap you in a cycle that is nearly impossible to escape on your own.
Chapter 7 bankruptcy can completely eliminate credit card debt. In most cases, you will owe nothing to your credit card companies after your discharge — no settlements, no payment plans, just a clean slate. Chapter 13 can also significantly reduce what you pay back on credit card debt, often paying pennies on the dollar.
Check out our blog on the difference between Chapter 7 and Chapter 13 bankruptcy in Georgia here.
Discharging Medical Debt in Georgia
Medical debt is the leading cause of bankruptcy in the United States. A single hospitalization, unexpected surgery, or chronic illness can generate tens of thousands of dollars in bills that insurance does not fully cover. You are not alone — and you have legal options.
Medical bills are classified as unsecured debt, which means they can be fully discharged in a Chapter 7 bankruptcy. You can eliminate medical debt from hospitals, doctors, specialists, and collection agencies that have purchased your debt. Chapter 13 bankruptcy can also restructure medical debt into manageable payments, often dramatically reducing the total amount owed.
What Property Can You Keep? Georgia Bankruptcy Exemptions
A major concern for people considering bankruptcy is losing their belongings. Georgia’s bankruptcy exemptions under O.C.G.A. § 44-13-100 protect significant assets:
- Home equity: Up to $21,500 ($43,000 for married couples filing jointly)
- Vehicle: Up to $5,000 in equity in one motor vehicle
- Household goods and furnishings: Up to $5,000 total
- Wildcard exemption: Up to $1,200 plus unused homestead exemption (up to $10,000)
- Retirement accounts: 401(k), IRA, pension — generally fully protected
- Life insurance cash value: Protected up to certain limits
The vast majority of Chapter 7 cases in Georgia are “no asset” cases, meaning filers keep everything they own. An experienced bankruptcy attorney can help you structure your filing to maximize your exemptions.
Frequently Asked Questions About Personal Bankruptcy in Georgia
How much does it cost to file bankruptcy in Georgia?
The court filing fee for Chapter 7 is $338 and for Chapter 13 is $313. Attorney fees vary based on case complexity. Many bankruptcy attorneys offer payment plans. Do not let cost stop you from exploring your options — the cost of not filing is often far greater.
Can I file bankruptcy on medical bills only?
Yes. There is no minimum debt requirement for bankruptcy. If medical debt is your primary financial burden, you can file Chapter 7 and discharge that debt entirely, even if you have little to no other debt.
Will I lose my house or car if I file bankruptcy in Georgia?
Most people do not lose their home or car. Georgia’s homestead exemption protects up to $21,500 in home equity, and the vehicle exemption protects up to $5,000 in vehicle equity. If you are current on your payments and your equity is within exemption limits, you can keep both.
Can I file bankruptcy more than once in Georgia?
Yes, but there are waiting periods. You must wait 8 years between Chapter 7 filings, 4 years between Chapter 7 and Chapter 13, and 2 years between Chapter 13 filings.
Will bankruptcy stop wage garnishment immediately?
Yes. The automatic stay goes into effect the moment you file. Your employer is legally required to stop garnishing your wages, typically within 1 to 2 business days of receiving notice of the filing.
What debts cannot be discharged in Georgia bankruptcy?
Certain debts survive bankruptcy regardless of the chapter filed, including:
- Student loans (except in proven undue hardship cases)
- Child support and alimony
- Most recent federal and state tax debts
- Debts from fraud or intentional wrongdoing
- Criminal fines and restitution
- DUI-related injury judgments
Do I have to go to court?
You will attend one brief meeting called the 341 Meeting of Creditors. This is not a courtroom proceeding — it takes place in a conference room with the bankruptcy trustee. Your attorney will be with you. The meeting typically lasts under 10 minutes.