Bankruptcy FAQ

Will I lose all of my property?

Probably not, most if not all of your property Is ”exempt property” property that is set aside to you free and clear. Some property, such as cash, investments, luxury items, and in many cases income tax refunds, are not exempt and must be paid over to your creditors. You must make arrangements to pay secured debt, mortgages, car loans, furniture loans etc. if you want to keep that property.

What kind of debts can I get rid of?

There are some debts that we cannot discharge, or get rid of. They include student loans,  child support and alimony, fines and restitution in criminal cases, debts incurred by fraud, debts incurred by intentional infliction of injury on another person, and income tax debts that have come due in the last three years There may be some other non-dischargeable debt. The great majority of your debt is likely dischargeable. Doctor bills, hospital bills, credit card debt are all dischargeable. To get an accurate determination of your in dischargeable and non-dischargeable debt we need to get together and review that debt.

Do I qualify for a bankruptcy?

There is no minimum amount of money that you must owe to qualify for a bankruptcy. But there is of course a point at which it makes no sense to file. That's an issue that we will have to review when we meet to discuss your case.. If you have  filed a bankruptcy in the past , the bankruptcy code sets some time limitations on your ability to file a new case. If you have received a discharge under chapter 7 you cannot another chapter 7 for eight years. Nor can you file a chapter 13 reorganization for six years unless you propose a good faith reorganization plan that pays at least 70% of your debt. If you have filed a chapter 13 reorganization ,and received a discharge, you cannot file a Chapter 7 within four years but you can file another chapter 13 at any time. are also restrictions on what kind of bankruptcy from file based on your income and expenses. Again that is a determination that we must make after reviewing your finances.

What is the difference between Chapter 7 and Chapter 13?

Chapter 7 is a liquidation. A Chapter 7 trustee takes your non-exempt property and sells it, pays herself a commission and distributes the balance of that money to your unsecured creditors. In a Chapter 7, if you want to keep your secured property,  you will have the enter into a new contract with the creditors. A chapter 13 is a reorganization plan for debtor's with a regular source of income.

In a chapter 13 the debtor is in control not the trustee, and the objective of a chapter 13 is to propose a repayment plan where the debtor can pay certain doubts like mortgage arrearages and car loans and discharge other debts. You can do everything in a chapter 13 that you can do in a Chapter 7 plus a lot more stuff. A chapter 13 is not a consolidation, we are not putting everything in a big pile and paying it off. A chapter 13 is a restructuring of your debt with different kinds of debts being treated in different ways, including discharging unsecured debt.

What does a bankruptcy cost?

Bankruptcies are not cheap, but in a chapter 13 bankruptcy attorneys fees, filing fees and administrative expenses can be paid over a period of time. With payments as low as to $100 per month, and a $100 upfront docketing fee. In a Chapter 7 the majority of the fees must be paid up front as well as a $299 filing fee. Those fees must be paid up front because an attorney's fee is no different from a doctor bill or credit card, and if the bankruptcy is filed before those fees are paid the attorney cannot collect them from you and they will ultimately be discharged.

How long does it take to get a bankruptcy filed?

We will need to meet three times at a first meeting I will explain bankruptcies, how they work, and what we can they cannot do at the second meeting we will review  your debts, your income and expenses and your financial affairs. Finally you will need to meet with your case manager to review and sign your bankruptcy paperwork the whole process should not take more than a week to 10 days. It is important, however, that you provide me with the information set out in the bankruptcy checklist that I need to prepare your paperwork.