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 FAQs

1. What are the different types of bankruptcy?

 

There are two types of bankruptcy that individuals and families can file under the Bankruptcy Code. Chapter 7 and Chapter 13.

 

Chapter 7 is the most common bankruptcy that is filed. Under Chapter 7, the debtor's (you)debts are discharged by the Bankruptcy Court after a one time hearing before a bankruptcy trustee. You can lose some of your money and property in Chapter 7 but that is rare. The law has built in protections for your retirement, home and automobile. In over 90% of the Chapter 7 cases, the debtor (you) will lose none of your money or property.

 

Chapter 13 is the other bankruptcy that is payment plan that the Bankruptcy Court sets up for the debtor in order to make payments on the debts you owe. After you pay these monthly payments to the Chapter 13 Bankruptcy Trustee for a set period of time---anywhere from 3 to 5 years-- your debt is discharged. Depending on how your Chapter 13 case is set up, you might not have to pay back the entire balances on many of your debts. In addition, you are protected from any collection attempts by your creditors while you are making your payments your Chapter 13 case---this is a big advantage that credit counseling debt consolidations plans cannot provide.

 

The exact payment terms of Chapter 13 Plans will vary for each individual so working with a bankruptcy attorney is recommended in order to insure your Chapter 13 case is successful.

 

 

2. Right now, I cannot pay my debts. Besides bankruptcy, do I have any options?

 

Outside of financial help from another person or better income, if you cannot pay your debts as they come due then really bankruptcy is the only option.

 

The bankruptcy code does not have a provision on who and who cannot file for bankruptcy protection. in theory, anyone can file bankruptcy. Of course bankruptcy courts will deem cases as "abusive filings" and dismiss such cases if the person filing the bankruptcy (you the debtor) do not have a common sense reason for filing the case, such as you have no debt at all or no debt you are looking to continue to pay after the bankruptcy filing. Any competent bankruptcy attorney will advise you not to file, and in fact as an officer of the court, the attorney would be under a professional obligation not to file the case.

 

The best way to look at who can file bankruptcy is the test of whether you, or whether you cannot you can, pay your debts as they become due. If not, as the above questions ask, then really bankruptcy is the only realistic option for you unless another person will help you financially or you somehow can earn more income yourself in a short period of time.

 

You can always call your creditor (those you owe money to) and simply ask them to give you more time to pay them or provide you new payment terms to allow you to pay off your debts. Of course, this often will not work and thus again the Bankruptcy is the option for you. The bankruptcy laws are consumer protection laws passed by Congress to help individuals deal with financial difficulties.These laws are very effective and with the help of an experienced bankruptcy attorney the bankruptcy process will be easier and reassuring to you.

 

 

3. What is the trustee?

 

The Trustee of the Bankruptcy Court is an attorney appointed by the Court to conduct your Meeting of Creditors hearing. This is likely the only "court" hearing you will have to attend in your bankruptcy filing whether a Chapter 13 case or a Chapter 7 case. This Meeting of Creditors is not in a courtroom in front of a Judge with a dark robe.

 

The hearing is conducted in a office room with you the Trustee, your attorney and any of your creditors (the people you owe money to). In almost every case your creditors do not appear at the meeting. The only people there are you, your attorney and the Trustee.

 

The Trustee's job is to review your bankruptcy papers, your financial information (i.e tax returns, wage stubs, etc..) and your budget to make sure you qualify for Chapter 7 or Chapter 13 depending on which case you have filed. Your case might require you to appear in an actual courtroom before a Bankruptcy Judge but that is unlikely.

 

By hiring an experience bankruptcy attorney you will have the confidence that your bankruptcy filing will be performed correctly. You will be advised on how the process works and your bankruptcy papers will be filed correctly. You will know the questions the Trustee will ask you and have plenty of time to prepare for those answers even before your bankruptcy is filed.

 

 

4. What do I have to do to file bankruptcy?

 

You should first meet with an attorney who mainly does bankruptcy work. Most attorneys do not do bankruptcy work on a daily basis. You should seek the advise and counsel of a committed bankruptcy attorney. An attorney that spends most of his or her day filing bankruptcies and going to bankruptcy court.

 

Once you have decided to hire a bankruptcy attorney. He or she will guide you through the process of filing bankruptcy. Because you have hired a bankruptcy attorney, you will not have to worry about whether your attorney will be able to handle the case properly. No attorney is perfect but hiring an experienced bankruptcy counsel insures the best chance that your case will be performed correctly with as little amount of stress to you and your family.

 

The steps your bankruptcy attorney will guide you through to file your case will differ with each individual and family, but you can expect the attorney will be asking for and helping you gather personal financial information for your case such as tax returns, wage stubs, bank statements, your bills etc... to begin your case filing.

 

Once your case is filed, the Bankruptcy Court will issue an Order stopping all collection action by your creditors (the people you owe money to) including any pay stub and bank garnishments. At this time, you will also be issued a hearing date for your Meeting of Creditors, normally the only "court" hearing you will have. The date will be around 30 days out from the filing date. In the meantime, you simply wait for your hearing date and talk with your attorney occasionally to discuss your case and provide him and her with any updates about your financial situation.

 

On the date of your "court" hearing, you will meet your attorney at a downtown office building where you and your attorney will meet with the Bankruptcy Trustee. This meeting will take normally ten to fifteen minutes. By hiring an experience, dedicated bankruptcy attorney you will be completely prepared for this hearing. For most cases, this concludes your bankruptcy case as you simply wait another 60 days for when the Bankruptcy Court will issue a "Discharge" paper which officially eliminates your debts.

 

If you file a Chapter 13 bankruptcy, the steps will be the same except that you will make monthly payments of a fixed amount for a period of time before the Bankruptcy Court issues a "Discharged" paper.  

 

 

5. What if I want to pay some of my creditors?

 

That is fine. When you hire my office, I will explain to you the entire bankruptcy process step by step as well as provide you context on how to understand the legal system. The law is complicated, further many things have a legal effect to it but often do not matter from a practical stand point. My office will explain both to you in a way you can understand--that is our office commitment.

 

Every bankruptcy case that is filed by anyone requires a full financial disclosure to the Bankruptcy Court. If you hear someone say, " Well I did not list that in my case" or " I did not include that in my case" or " I did not have to disclose that in my case"., that means the person is confused about their bankruptcy case or he or she and their lawyer made a mistake. Every debt you have and every thing you own is included in your bankruptcy case regardless of whether you "listed" or not.

There is no "picking and choosing" in bankruptcy law.

 

You will often hear that people kept their home and their car and were able to make payments on these items after the case. And this is true, most people who want to keep their home and car by making future monthly payments can do just that.

 

But it is not because those items are not "included" in the bankruptcy case. These items were not taken by the Bankruptcy Trustee because the law itself protects these items up to a certain value combined with the fact the creditor (the bank you owe) on the item has a lien on the house or the car which allows them to take the house or car if you do not keep paying. If something is not listed on your bankruptcy papers--then the papers need to be amended.

 

To the question, you can, as with the example above on the house and car, continue to pay some of your creditors after the bankruptcy case is completed. Of course, often to do that makes no sense as you filed the bankruptcy (Chapter 7) not to do that, but as indicated, it might well makes sense to keep making payments on your house and car.

 

Once again, hiring an outstanding bankruptcy attorney who will take the time to explain these things well makes your bankruptcy case go much easier for you.  

 

 

6. Can my landlord evict me from my apartment after I file for bankruptcy?

 

Generally no. But there are exceptions to this rule and thus requires the attorney to ask specific questions of you to determine exactly where your landlord is in the eviction process. But the first step should be for you or your attorney to simply talk to your landlord and let him or her know what your current financial circumstances are that is causing you to have trouble paying your rent and that you are taking steps to correct the situation.

 

Bankruptcy will likely be one of those steps. The bankruptcy laws are consumer protection laws designed by Congress to help individuals and business better deal with their debt problems than to simply rely on their own efforts. Bankruptcy law is a critical part of the American system as it is the main way individuals and business place themselves back into a position where they have dramatically better control of their financial situation.  

 

7. What is bankruptcy?

 

Bankruptcy law is a consumer protection law designed to get individuals and families, and even business entities, out of debt troubles quicker and easier than other ways to deal with such problems. The law brings about an immediate and timely end to these debt problems.

 

A form of Bankruptcy law has been in existence since the early years of America.Any individual can file for bankruptcy protection as a federal right. Bankruptcy law is the main legal right that you have at your discretion to end debt problems permanently and without any uncertainty of the results once a Discharge in bankruptcy is issued.

 

Chapter 7 is the most common bankruptcy that is filed. Under Chapter 7, the debtor's (you)debts are discharged by the Bankruptcy Court after a one time hearing before a bankruptcy trustee. You can lose some of your money and property in Chapter 7 but that is rare. The law has built in protections for your retirement, home and automobile. In over 90% of the Chapter 7 cases, the debtor (you) will lose none of your money or property.

 

Chapter 13 is the other bankruptcy that is payment plan that the Bankruptcy Court sets up for the debtor in order to make payments on the debts you owe. After you pay these monthly payments to the Chapter 13 Bankruptcy Trustee for a set period of time---anywhere from 3 to 5 years-- your debt is discharged. Depending on how your Chapter 13 case is set up, you might not have to pay back the entire balances on many of your debts. In addition, you are protected from any collection attempts by your creditors while you are making your payments your Chapter 13 case---this is a big advantage that credit counseling debt consolidations plans cannot provide.

 

To fully understand the bankruptcy law--how it works, the benefits and the process---it is essential to speak with an experienced bankruptcy attorney. He or she will evaluate your specific situation, discuss all of your options, even those outside of bankruptcy, and dispel many of the myths and misunderstandings surrounding the bankruptcy laws. More often then not, after a full understanding of your situation, you will decide that the bankruptcy law is exactly the answer you need to allow you move forward in your life.

 

 

8. What are the major events in the bankruptcy process and when will the bankruptcy be over?

 

The standard Chapter 7 bankruptcy case last about 90 days---from filing the case and receiving a discharge. But you and your attorney will do most of your work before the bankruptcy is filed. The preparation to file your bankruptcy with your attorney can normally take a couple weeks but often can require more time.

 

Once your case is filed, the Bankruptcy Court will issue an Order stopping all collection action by your creditors (the people you owe money to) including any pay stub and bank garnishments. At this time, you will also receive a hearing date for your Meeting of Creditors, normally the only "court" hearing you will have. The date will be around 30 days after the filing date. In the meantime, you simply wait for your hearing and talk with your attorney occasionally to discuss your case and provide him or her with any updates about your financial situation.

 

On the date of your "court" hearing, you will meet your attorney at a downtown office building where you and your attorney will meet with the Bankruptcy Trustee. This meeting will take normally ten to fifteen minutes in length.

 

By hiring an experience, dedicated bankruptcy attorney you will be completely prepared for this hearing. For most cases, this concludes your bankruptcy case as you simply wait another 60 days for the Bankruptcy Court to issue your "Discharge" paper which officially eliminates your debts.

 

If you file a Chapter 13 Bankruptcy, the steps will be the same except that you will make monthly payments of a fixed amount for a period of time before the Bankruptcy Court issues your "Discharged" paper.

 

After your Discharge, the Court later administratively "closes" your case.    

 

 

9. What do I have to disclose about my finances in a bankruptcy filing?

 

As discussed earlier, in Bankruptcy law you are required to make a complete disclosure of all your financial information. Although this might seem a difficult task, hiring an experienced and dedicated bankruptcy attorney will help you complete this requirement making the process more manageable.You can expect to have to disclose any and all information about your financial life. This includes tax returns and bank accounts.

 

In order to benefit from the powerful relief the bankruptcy laws provide to you, the law requires that you completely disclose all information about your finances. You are require to provide this information to your bankruptcy attorney so he or she can properly prepare your case for filing. A dedicated attorney will help you in gathering this information and making sure that the information is properly disclosed.

 

This is a serious aspect of the Bankruptcy law. If a full disclosure is not performed in your bankruptcy case, you are opening yourself up to not only your bankruptcy case being dismissed by the Court, but you can be criminally prosecuted for any intentional failure to disclose any information about your finances.  

 

Hiring an experience, dedicated bankruptcy attorney will go along way to helping you fulfill the full financial disclosure requirement required by the Bankruptcy Code.

 

 

10. What does it cost to file bankruptcy?

 

Normally, a Chapter 7 bankruptcy attorney fees are $ 600 to $ 1000.00. For Chapter 13, attorney fees are $ 1500 to $ 2000.00. The fees can be higher if your case is unusually complicated. After a full evaluation by an experienced bankruptcy attorney he or she will be able to give you a specific flat fee or if hourly charging is appropriate---which is rare.

 

In addition to your attorney fees there are court costs for filing a bankruptcy petition. The costs to file bankruptcy change over time as the Bankruptcy Court's administrative expenses increase.You can expect to pay over $ 300.00 for filing costs.

 

 

11. Will I have to give up all my assets?

 

No. In fact in the vast majority of cases of Chapter 7 bankruptcy filings, you the debtor do not lose anything at all. Why? The bankruptcy laws have certain protections built in to prevent the Bankruptcy Trustee from taking your retirements accounts, home, automobiles and personal property and belongings. This is the main reason why the bankruptcy laws are effective. The debtor (you) really does not suffer any loss and now has a chance for a fresh financial start. Here is a list of some of the protection for your money or property pursuant to the statue 2329.66:

 

(1)

 

(a) In the case of a judgment or order regarding money owed for health care services rendered or health care supplies provided to the person or a dependent of the person, one parcel or item of real or personal property that the person or a dependent of the person uses as a residence. Division (A)(1)(a) of this section does not preclude, affect, or invalidate the creation under this chapter of a judgment lien upon the exempted property but only delays the enforcement of the lien until the property is sold or otherwise transferred by the owner or in accordance with other applicable laws to a person or entity other than the surviving spouse or surviving minor children of the judgment debtor. Every person who is domiciled in this state may hold exempt from a judgment lien created pursuant to division (A)(1)(a) of this section the person's interest, not to exceed one hundred twenty-five thousand dollars, in the exempted property.

 

(b) In the case of all other judgments and orders, the person's interest, not to exceed one hundred twenty-five thousand dollars, in one parcel or item of real or personal property that the person or a dependent of the person uses as a residence.

 

(c) For purposes of divisions (A)(1)(a) and (b) of this section, "parcel" means a tract of real property as identified on the records of the auditor of the county in which the real property is located.

 

(2) The person's interest, not to exceed three thousand two hundred twenty-five dollars, in one motor vehicle;

 

(3) The person's interest, not to exceed four hundred dollars, in cash on hand, money due and payable, money to become due within ninety days, tax refunds, and money on deposit with a bank, savings and loan association, credit union, public utility, landlord, or other person, other than personal earnings.

 

(4)

 

(a) The person's interest, not to exceed five hundred twenty-five dollars in any particular item or ten thousand seven hundred seventy-five dollars in aggregate value, in household furnishings, household goods, wearing apparel, appliances, books, animals, crops, musical instruments, firearms, and hunting and fishing equipment that are held primarily for the personal, family, or household use of the person;

 

(b) The person's aggregate interest in one or more items of jewelry, not to exceed one thousand three hundred fifty dollars, held primarily for the personal, family, or household use of the person or any of the person's dependents.

 

(5) The person's interest, not to exceed an aggregate of two thousand twenty-five dollars, in all implements, professional books, or tools of the person's profession, trade, or business, including agriculture;

 

(6)

 

(a) The person's interest in a beneficiary fund set apart, appropriated, or paid by a benevolent association or society, as exempted by section 2329.63 of the Revised Code;

 

(b) The person's interest in contracts of life or endowment insurance or annuities, as exempted by section 3911.10 of the Revised Code;

 

(c) The person's interest in a policy of group insurance or the proceeds of a policy of group insurance, as exempted by section 3917.05 of the Revised Code;

 

(d) The person's interest in money, benefits, charity, relief, or aid to be paid, provided, or rendered by a fraternal benefit society, as exempted by section 3921.18 of the Revised Code;

 

(e) The person's interest in the portion of benefits under policies of sickness and accident insurance and in lump sum payments for dismemberment and other losses insured under those policies, as exempted by section 3923.19 of the Revised Code.

 

(7) The person's professionally prescribed or medically necessary health aids;

 

(8) The person's interest in a burial lot, including, but not limited to, exemptions under section 517.09 or 1721.07 of the Revised Code;

 

(9) The person's interest in the following:

 

(a) Moneys paid or payable for living maintenance or rights, as exempted by section 3304.19 of the Revised Code;

 

(b) Workers' compensation, as exempted by section 4123.67 of the Revised Code;

 

(c) Unemployment compensation benefits, as exempted by section 4141.32 of the Revised Code;

 

(d) Cash assistance payments under the Ohio works first program, as exempted by section 5107.75 of the Revised Code;

 

(e) Benefits and services under the prevention, retention, and contingency program, as exempted by section 5108.08 of the Revised Code;

 

(f) Disability financial assistance payments, as exempted by section 5115.06 of the Revised Code;

 

(g) Payments under section 24 or 32 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C. 1 , as amended.

 

(10)

 

(a) Except in cases in which the person was convicted of or pleaded guilty to a violation of section 2921.41 of the Revised Code and in which an order for the withholding of restitution from payments was issued under division (C)(2)(b) of that section, in cases in which an order for withholding was issued under section 2907.15 of the Revised Code, in cases in which an order for forfeiture was issued under division (A) or (B) of section 2929.192 of the Revised Code, and in cases in which an order was issued under section 2929.193 or 2929.194 of the Revised Code, and only to the extent provided in the order, and except as provided in sections 3105.171 , 3105.63 , 3119.80 , 3119.81 , 3121.02 , 3121.03 , and 3123.06 of the Revised Code, the person's rights to or interests in a pension, benefit, annuity, retirement allowance, or accumulated contributions, the person's rights to or interests in a participant account in any deferred compensation program offered by the Ohio public employees deferred compensation board, a government unit, or a municipal corporation, or the person's other accrued or accruing rights or interests, as exempted by section 145.56 , 146.13 , 148.09 , 742.47 , 3307.41 , 3309.66 , or 5505.22 of the Revised Code, and the person's rights to or interests in benefits from the Ohio public safety officers death benefit fund;

 

(b) Except as provided in sections 3119.80 , 3119.81 , 3121.02 , 3121.03 , and 3123.06 of the Revised Code, the person's rights to receive or interests in receiving a payment or other benefits under any pension, annuity, or similar plan or contract, not including a payment or benefit from a stock bonus or profit-sharing plan or a payment included in division (A)(6)(b) or (10)(a) of this section, on account of illness, disability, death, age, or length of service, to the extent reasonably necessary for the support of the person and any of the person's dependents, except if all the following apply:

 

(i) The plan or contract was established by or under the auspices of an insider that employed the person at the time the person's rights or interests under the plan or contract arose.

 

(ii) The payment is on account of age or length of service.

 

(iii) The plan or contract is not qualified under the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C. 1 , as amended.

 

(c) Except for any portion of the assets that were deposited for the purpose of evading the payment of any debt and except as provided in sections 3119.80 , 3119.81 , 3121.02 , 3121.03 , and 3123.06 of the Revised Code, the person's rights or interests in the assets held in, or to directly or indirectly receive any payment or benefit under, any individual retirement account, individual retirement annuity, "Roth IRA," "529 plan," or education individual retirement account that provides payments or benefits by reason of illness, disability, death, retirement, or age or provides payments or benefits for purposes of education, to the extent that the assets, payments, or benefits described in division (A)(10)(c) of this section are attributable to or derived from any of the following or from any earnings, dividends, interest, appreciation, or gains on any of the following:

 

(i) Contributions of the person that were less than or equal to the applicable limits on deductible contributions to an individual retirement account or individual retirement annuity in the year that the contributions were made, whether or not the person was eligible to deduct the contributions on the person's federal tax return for the year in which the contributions were made;

 

(ii) Contributions of the person that were less than or equal to the applicable limits on contributions to a Roth IRA or education individual retirement account in the year that the contributions were made;

 

(iii) Contributions of the person that are within the applicable limits on rollover contributions under subsections 219, 402(c), 403(a)(4), 403(b)(8), 408(b), 408(d)(3), 408A(c)(3)(B), 408A(d)(3), and 530(d)(5) of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 1 , as amended;

 

(iv) Contributions by any person into any plan, fund, or account that is formed, created, or administered pursuant to, or is otherwise subject to, section 529 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C. 1 , as amended.

 

(d) Except for any portion of the assets that were deposited for the purpose of evading the payment of any debt and except as provided in sections 3119.80 , 3119.81 , 3121.02 , 3121.03 , and 3123.06 of the Revised Code, the person's rights or interests in the assets held in, or to receive any payment under, any Keogh or "H.R. 10" plan that provides benefits by reason of illness, disability, death, retirement, or age, to the extent reasonably necessary for the support of the person and any of the person's dependents.

 

(e) The person's rights to or interests in any assets held in, or to directly or indirectly receive any payment or benefit under, any individual retirement account, individual retirement annuity, "Roth IRA," "529 plan," or education individual retirement account that a decedent, upon or by reason of the decedent's death, directly or indirectly left to or for the benefit of the person, either outright or in trust or otherwise, including, but not limited to, any of those rights or interests in assets or to receive payments or benefits that were transferred, conveyed, or otherwise transmitted by the decedent by means of a will, trust, exercise of a power of appointment, beneficiary designation, transfer or payment on death designation, or any other method or procedure.

 

(f) The exemptions under divisions (A)(10)(a) to (e) of this section also shall apply or otherwise be available to an alternate payee under a qualified domestic relations order (QDRO) or other similar court order.

 

(g) A person's interest in any plan, program, instrument, or device described in divisions (A)(10)(a) to (e) of this section shall be considered an exempt interest even if the plan, program, instrument, or device in question, due to an error made in good faith, failed to satisfy any criteria applicable to that plan, program, instrument, or device under the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C. 1 , as amended.

 

(11) The person's right to receive spousal support, child support, an allowance, or other maintenance to the extent reasonably necessary for the support of the person and any of the person's dependents;

 

(12) The person's right to receive, or moneys received during the preceding twelve calendar months from, any of the following:

 

(a) An award of reparations under sections 2743.51 to 2743.72 of the Revised Code, to the extent exempted by division (D) of section 2743.66 of the Revised Code;

 

(b) A payment on account of the wrongful death of an individual of whom the person was a dependent on the date of the individual's death, to the extent reasonably necessary for the support of the person and any of the person's dependents;

 

(c) Except in cases in which the person who receives the payment is an inmate, as defined in section 2969.21 of the Revised Code, and in which the payment resulted from a civil action or appeal against a government entity or employee, as defined in section 2969.21 of the Revised Code, a payment, not to exceed twenty thousand two hundred dollars, on account of personal bodily injury, not including pain and suffering or compensation for actual pecuniary loss, of the person or an individual for whom the person is a dependent;

 

(d) A payment in compensation for loss of future earnings of the person or an individual of whom the person is or was a dependent, to the extent reasonably necessary for the support of the debtor and any of the debtor's dependents.

 

(13) Except as provided in sections 3119.80 , 3119.81 , 3121.02 , 3121.03 , and 3123.06 of the Revised Code, personal earnings of the person owed to the person for services in an amount equal to the greater of the following amounts:

 

(a) If paid weekly, thirty times the current federal minimum hourly wage; if paid biweekly, sixty times the current federal minimum hourly wage; if paid semimonthly, sixty-five times the current federal minimum hourly wage; or if paid monthly, one hundred thirty times the current federal minimum hourly wage that is in effect at the time the earnings are payable, as prescribed by the "Fair Labor Standards Act of 1938," 52 Stat. 1060, 29 U.S.C. 206(a)(1) , as amended;

 

(b) Seventy-five per cent of the disposable earnings owed to the person.

 

(14) The person's right in specific partnership property, as exempted by the person's rights in a partnership pursuant to section 1776.50 of the Revised Code, except as otherwise set forth in section 1776.50 of the Revised Code;

 

(15) A seal and official register of a notary public, as exempted by section 147.04 of the Revised Code;

 

(16) The person's interest in a tuition unit or a payment under section 3334.09 of the Revised Code pursuant to a tuition payment contract, as exempted by section 3334.15 of the Revised Code;

 

(17) Any other property that is specifically exempted from execution, attachment, garnishment, or sale by federal statutes other than the "Bankruptcy Reform Act of 1978," 92 Stat. 2549, 11 U.S.C.A. 101 , as amended;

 

(18) The person's aggregate interest in any property, not to exceed one thousand seventy-five dollars, except that division (A)(18) of this section applies only in bankruptcy proceedings.

 

Like any statue, this statue requires an attorney to properly apply the language of the statue to your particular case. Only a lawyer is allowed by law to give legal advice. Only a lawyer's education, training and experience can guide you to insure your case is filed properly and the right exemption above are claimed in your case. so your money and property is protected.

 

 

***Disclaimer***Attempting to read and interpret a statue on your own without a lawyer's guidance creates the risk that your case is not filed properly and/or you could end up losing money or property needlessly.  

 

 

Finally, Chapter 13 is the payment plan bankruptcy that allows you to consolidate all of your debts and reduce the amount you pay back. A Chapter 13 is not a case where the Trustee tries to take any of your property like a house or a car. The Chapter 13 law only requires that you maintain a monthly payment. Again, hiring an experienced and dedicated bankruptcy attorney will ensure you file the right bankruptcy and that the case is handled properly.

 

 

12. What does Chapter 7 bankruptcy involve?

 

Chapter 7 Bankruptcy is the most common bankruptcy that is filed. Chapter 7 will erase most of the debts that you have allowing you a financial fresh start. The court document that allows you to discharge your debts is the Bankruptcy Discharge.

 

The standard Chapter 7 bankruptcy case last about 90 days---from filing the case and receiving a discharge. But you and your attorney will do most of your work before the bankruptcy is filed. The preparation to file your bankruptcy with your attorney can normally takes a couple weeks but often can require more time.

 

Once your case is filed, the Bankruptcy Court will issued an Order stopping all collection action by your creditors (the people you owe money to) including any pay stub and bank garnishments. At this time, you will also have a hearing date for your Meeting of Creditors, normally the only "court" hearing you will have. The date will be around 30 days out from the filing date. In the meantime, you simply wait for your hearing date and talk with your attorney occasionally to discuss your case and provide him and her with any update about your financial situation.

 

On the date of your "court" hearing, you will meet your attorney at a downtown office building where you and your attorney will meet with the Bankruptcy Trustee. This meeting will take normally ten to fifteen minutes. By hiring an experience, dedicated bankruptcy attorney you will be completely prepared for this hearing. For most cases, this concludes your bankruptcy case as you simply wait another 60 days for when the Bankruptcy Court will issue your "Discharge" paper which officially eliminates your debts.

 

 

13. What does a Chapter 13 bankruptcy involve?

 

The Chapter 13 Bankruptcy is the second most filed bankruptcy case. In Chapter 13, the law forces the people who you owe money to (your creditors) to accept a lower payment amount and a lower balance amount that will be paid by you. The Chapter 13 also in most cases stops the interest that is accruing on your current outstanding debts (except car, house and other secured loans).

 

Chapter 13 is also able to modify the terms of a second mortgage in some situations and Chapter 13 can stop foreclosure actions and allow you to force a payment plan on the mortgage company to allow you to catch up on your mortgage payments over time.

 

The same process for Chapter 7 applies for Chapter 13. You and your attorney will work together to complete the bankruptcy papers making sure there are no legal problems with your case.  The standard time for the Chapter 13 bankruptcy will last about 90 days---from filing the case to when the Court will officially approve your repayment plan. But you and your attorney will do most of your work before the bankruptcy is filed. The preparation to file your bankruptcy with your attorney can normally takes a couple weeks but often can require more time.

 

Once your case is filed, the Bankruptcy Court will issued an Order stopping all collection action by your creditors (the people you owe money to) including any pay stub and bank garnishments. At this time, you will also have a hearing date for your Meeting of Creditors, normally the only "court" hearing you will have. The date will be around 30 days out from the filing date. In the meantime, you simply wait for your hearing date and talk with your attorney occasionally to discuss your case and provide him and her with any updates about your financial situation.

 

On the date of your "court" hearing, you will meet your attorney at a downtown office building where you and your attorney will meet with the Bankruptcy Trustee. This meeting will take normally ten to fifteen minutes. By hiring an experience, dedicated bankruptcy attorney you will be completely prepared for this hearing.

 

Once this hearing is completed you continue making the monthly payments set out in your Chapter 13 Plan---this last anywhere from 3 to 5 years but could be less. Upon completion of your payments the Bankruptcy Court will issue a Chapter 13 Discharge which officially ends your case and erases the remaining balances that are still be due on your debts. Note, your back mortgage payments will be caught up but your long term 15 year or 30 year mortgage will still need to be paid like you were paying it the entire time during the Chapter 13 bankruptcy case.

 

 

14. What is Chapter 20?

 

There is no Chapter 20 provision in the Bankruptcy Code. The term Chapter 20 is an informal way attorneys describe a situation where it might be appropriate for a debtor (you) to file two separate bankruptcies close in time. This involves a complicated legal evaluation by you and your attorney. As always, it is highly recommended to always consult and hire an experienced bankruptcy attorney before attempting to file any bankruptcy case. Multiple bankruptcy filings, as well as filing a bankruptcy without proper legal advice, might compromise your bankruptcy rights.

 

15. What is a Chapter 26 bankruptcy?

 

There is no Chapter 26 provision in the Bankruptcy Code. The term Chapter 26 is an informal way attorneys describe a situation where it might be appropriate for a debtor (you) to file two separate bankruptcy cases close in time. This involves a complicated legal evaluation by you and your attorney. As always, it is highly recommended to always consult and hire an experienced bankruptcy attorney before attempting to file any bankruptcy case. Multiple bankruptcy filings, as well as filing a bankruptcy without proper legal advice, might compromise your bankruptcy rights.

 

16. Can I not be approved for bankruptcy?

 

This is a very rare event. Everyone can qualify for some type of bankruptcy, assuming it makes practical sense to file given one's amount of debt and current income levels, and will be approved by the Bankruptcy Court for either a Chapter 13 or Chapter 7 bankruptcy. Cases where bankruptcy is denied to a debtor is where:

1)You the debtor simply file the wrong bankruptcy type that you do not qualify for, or 2)You the debtor have prior bankruptcy filings that might prevent you from filing again at the present time or, 3)You the debtor engaged in some bad conduct that the Court believes justifies the denial of bankruptcy protection for you.

 

Hiring an experienced bankruptcy attorney will prevent these things from happening to you.

 

17. If I file for bankruptcy, can I keep my credit cards?

 

Practically speaking why would you? The main purpose of Chapter 7 is to provide you the debtor a complete financial fresh start, that is free from debt. One of the main drivers of bankruptcy is credit card debt that one cannot easily get out of given the high interest rates. Why would you want to keep paying on those credit card balances?

 

Having said that,many people will have one or two cards that they have a small balance on and they want to continue their relationship with that particular credit card. You can keep paying voluntary payments to that card on the balance incurred before the filing of the bankruptcy in order to keep the account open. Remember, the Bankruptcy Discharge just prevents the creditor from suing you for any amounts charged before the bankruptcy filing. I you want, you can always pay those balances back voluntarily.    

 

Yet, you will find that after you file Chapter 7 bankruptcy, you will be offered new credit again from various sources. Why? Remember, the law only allows you to file Chapter 7 Bankruptcy once every 8 years. Thus, often you will be offered new credit after you file Chapter 7 because you will not be able to file Chapter 7 Bankruptcy on these new debts anytime soon.

 

(Note: you may file multiple Chapter 13 bankruptcies over a time but this requires caution and thus only an experienced bankruptcy attorney can guide on that decision)

 

Further, with your old debts discharged after your Chapter 7 Bankruptcy, your ability to pay back any new debt is dramatically improved. This is how people will often be able to obtain new financing for a car and even a house within 6 months to a year after the Chapter 7 Bankruptcy filing. Please know that new credit after Chapter 7 bankruptcy is going to vary greatly from individual to individual as some people start making more money after the bankruptcy then they were before which is one of the main factors on why any new credit is offered.

 

In, Chapter 13, the Bankruptcy Trustee does not permit you to incur new debt while in bankruptcy, except possibly for a necessary car loan.

 

Please know, the Chapter 13 Trustee understands that during the life of a Chapter 13 payment plan that you (the debtor) might run into expenses (ie, car repair, house repairs) that in the past you would place on a credit card. Of course, over time that credit balance must be paid off and if you did not then that might be one reason why you needed the bankruptcy law for protection. This is understandable. Yet, while you are in Chapter 13 the law requires you take a different approach to dealing with expenses.  

 

Chapter 13 law will allow you to suspend monthly payments to the Chapter 13 Trustee from time to time so you have additional money to meet these periodic expenses. Moreover, the budget that you start out with in your Chapter 13 Bankruptcy case has in place certain monthly budget amounts for car repairs or house repairs. You must disciple yourself to stick to this budget. If you do, then you will have the money saved throughout the life of the Chapter 13 case to pay in cash these expenses as they arise. But if not, again as indicated, you can request to suspend payments to the Chapter 13 Trustee for a month or two to deal with new expenses. Of course, like anything, there is a limit on the number of suspensions you can apply, and in some cases you cannot be approved for such suspended payments. An experience bankruptcy counsel will guide you here.  

 

18. Are there tax consequences to filing bankruptcy?

 

Generally, there are no tax consequences to filing bankruptcy. However, you should hire an experienced bankruptcy attorney to further discuss this issue. Taxes and bankruptcy law are both complex.

 

 

19. What if I cannot make the payments required under my bankruptcy court ordered plan?

 

A discussion with your bankruptcy attorney on this is important. Generally, you can make adjustments to the amount of the monthly payment you are making to the Chapter 13 Trustee. However, there are some limitations on this as you must continue to propose to the Chapter 13 Trustee a reasonable monthly budget that you are required to live within.

 

Further, a Chapter 13 Plan by law can only last up to a maximum of 5 years. Often, your bankruptcy case has some debts, though normally not all, that require the entire balance to be paid in full (example: back mortgage payments or an automobile balance) by the end of the fifth year. Again, a complete discussion with your bankruptcy attorney is needed to determine whether or not the proposed lower monthly payments to the Chapter 13 Trustee will be acceptable under the law.

 

Along the same lines, you also may ask the Bankruptcy Court to suspend your payments to the Chapter 13 Trustee for several months. Chapter 13 law will allow you to suspend monthly payments to the Chapter 13 Trustee from time to time. Moreover, the budget that you start out with in your Chapter 13 Bankruptcy case has in place certain monthly budget amounts for car repairs or house repairs. You must discipline yourself to stick to this budget. Of course, like anything, there is a limit on the number of suspensions you can apply, and in some cases you cannot be approved for such suspended payments. An experience bankruptcy counsel will guide you here.  

 

When you hire a dedicated experience bankruptcy attorney you will know exactly how and when your Chapter 13 payment amount can be adjusted.  

 

 

20. What happens if my employer filed for bankruptcy and owes me money?

 

This is a case where you are a creditor of your employer who owes you money (back wages). The short answer is that you file a proof of your claim with the bankruptcy court stating the amount of money you believe your employer owes you. It is best to hire a bankruptcy attorney to do this for you.

 

21. How do I know which bankruptcy chapter to file?

 

Consulting with and hiring an experienced bankruptcy counsel will help you greatly in knowing the best type of bankruptcy for you to file, or whether to file bankruptcy at all. Many factors go in to determine what is the best chapter to file. A review of the two main types will help clarify this question for you.

 

1.  Chapter 7 is the most common bankruptcy that is filed. Under Chapter 7, the debtor's (you)debts are discharged by the Bankruptcy Court after a one time hearing before a bankruptcy trustee. You can lose some of your money and property in Chapter 7 but that is rare. The law has built in protections for your retirement, home and automobile. In over 90% of the Chapter 7 cases, the debtor (you) will lose none of your money or property.

 

2. Chapter 13 is the other bankruptcy that is payment plan that the Bankruptcy Court sets up for the debtor in order to make payments on the debts you owe. After you pay these monthly payments to the Chapter 13 Bankruptcy Trustee for a set period of time---anywhere from 3 to 5 years-- your debt is discharged. Depending on how your Chapter 13 case is set up, you might not have to pay back the entire balances on many of your debts. In addition, you are protected from any collection attempts by your creditors while you are making your payments your Chapter 13 case---this is a big advantage that credit counseling debt consolidations plans cannot provide.

 

For most people the Chapter 7 will be the appropriate bankruptcy to file. Most people, after a reasonable monthly budget, do not have enough monthly income to fund a Chapter 13 bankruptcy. The critical question in Chapter 7 is whether the Trustee of the bankruptcy court is able to take some of your money or property to distribute some payment to your debts before the balances are wiped out. In most cases the answer is no.  

 

If you are the rare Chapter 7 case that would allow the Trustee to take some of your money or property, than this is one of the three main reasons why people do Chapter 13.

 

A debtor (you) will do Chapter 13 for one of three main reasons:

 

1. Your budget has excess income to pay a monthly payment in a Chapter 13 repayment plan.

2. You do qualify for Chapter 7 but you will lose some money or property to the Trustee and thus you elect to do Chapter 13 to prevent this outcome.

3. Your house is in foreclosure and you want to stop the foreclosure to begin repayment on your home.

 

Of course, there may be other reasons why a debtor will file a Chapter 13. Once again, hiring an experienced bankruptcy attorney will insure you file the correct bankruptcy case for your situation.

 

 

22. What steps do I need to take before filing for bankruptcy?

 

The first step is making an appointment with a excellent bankruptcy attorney and having a complete consultation with him or her on your specific situation. But even before meeting with a bankruptcy attorney, it is not a bad idea to do some research of your own to begin to understand the bankruptcy law.

 

Anytime you purchase a good or service, the more you know about that good or service the better will be your decision on what to buy and/or who to hire.It is important that you are getting information from reliable, authoritative source. The only source to seek bankruptcy information from is an actual practicing bankruptcy attorney.  

 

My office has made a serious of videos where I talk briefly in those videos about the bankruptcy process. You can Youtube Robert Holmes bankruptcy attorney to find those videos. Of course, reading all the information on this webpage is an excellent way to start the bankruptcy process.

 

The specific steps in actually preparing your case will be outlined by my office once you hire us for your case. We are very specific on the steps you must take to insure your bankruptcy is filed properly. We will help you complete many of the steps and we will always be there to answer your questions or concerns.  

 

23. How long does the bankruptcy process typically take?

 

The standard Chapter 7 bankruptcy case last about 90 days---from filing the case and receiving a discharge. But you and your attorney will do most of your work before the bankruptcy is filed. The preparation to file your bankruptcy with your attorney can normally takes a couple weeks but often can require more time.

 

Once your case is filed, the Bankruptcy Court will issued an Order stopping all collection action by your creditors (the people you owe money to) including any pay stub and bank garnishments. At this time, you will also have a hearing date for your Meeting of Creditors, normally the only "court" hearing you will have. The date will be around 30 days out from the filing date. In the meantime, you simply wait for your hearing date and talk with your attorney occasionally to discuss your case and provide him and her with any update about your financial situation.

 

On the date of your "court" hearing, you will meet your attorney at a downtown office building where you and your attorney will meet with the Bankruptcy Trustee. This meeting will take normally ten to fifteen minutes. By hiring an experience, dedicated bankruptcy attorney you will be completely prepared for this hearing. For most cases, this concludes your bankruptcy case as you simply wait another 60 days for when the Bankruptcy Court will issue your "Discharge" paper which officially eliminates your debts.

 

The same process for Chapter 7 applies for Chapter 13. You and your attorney will work together to complete the bankruptcy papers making sure there are no legal problems with your case.  The standard time for the Chapter 13 bankruptcy will last about 90 days---from filing the case to when the Court will officially approve your repayment plan. But you and your attorney will do most of your work before the bankruptcy is filed. The preparation to file your bankruptcy with your attorney can normally takes a couple weeks but often can require more time.

 

Once your case is filed, the Bankruptcy Court will issued an Order stopping all collection action by your creditors (the people you owe money to) including any pay stub and bank garnishments. At this time, you will also have a hearing date for your Meeting of Creditors, normally the only "court" hearing you will have. The date will be around 30 days out from the filing date. In the meantime, you simply wait for your hearing date and talk with your attorney occasionally to discuss your case and provide him and her with any updates about your financial situation.

 

On the date of your "court" hearing, you will meet your attorney at a downtown office building where you and your attorney will meet with the Bankruptcy Trustee. This meeting will take normally ten to fifteen minutes. By hiring an experience, dedicated bankruptcy attorney you will be completely prepared for this hearing.

 

Once this hearing is completed you continue making the monthly payments set out in your Chapter 13 Plan---this last anywhere from 3 to 5 years but could be less. Upon completion of your payments the Bankruptcy Court will issue a Chapter 13 Discharge which officially ends your case and erases the remaining balances that are still be due on your debts. Note, your back mortgage payments will be caught up but your long term 15 year or 30 year mortgage will still need to be paid like you were paying it the entire time during the Chapter 13 bankruptcy case.

 

24. How do I prepare my bankruptcy payment plan?

 

Chapter 13 is the bankruptcy that is payment plan that the Bankruptcy Court sets up for the debtor in order to make payments on the debts you owe. After you pay these monthly payments to the Chapter 13 Bankruptcy Trustee for a set period of time---anywhere from 3 to 5 years-- your debt is discharged. Depending on how your Chapter 13 case is set up, you might not have to pay back the entire balances on many of your debts. In addition, you are protected from any collection attempts by your creditors while you are making your payments your Chapter 13 case---this is a big advantage that credit counseling debt consolidations plans cannot provide.

 

The exact payment terms of Chapter 13 Plans will vary for each individual so working with a bankruptcy attorney is recommended in order to insure your Chapter 13 case is successful. The short answer on your payment amount is it will be the amount that is left over of your pay after you pay those reasonable, necessary living expenses that make up your monthly budget.

 

25. What if I cannot afford a bankruptcy attorney?

 

It might not matter then for you to even file bankruptcy at all. If your budget is so tight each month that you cannot afford an attorney this might be because you are on a fixed income that is excluded by collection efforts anyway, such as social security income or disability. Of course, there may be reasons why someone on such income would want to file bankruptcy anyway. You should consult with a bankruptcy attorney first.But if you have an income source you should be able gather up enough money over time to be able to pay your bankruptcy attorney to file your case.

 

Most bankruptcy cases are not too complicated in the sense that lawyers need to charge a large fee. It is not recommended to file your bankruptcy case on your own despite what other sources of information might tell you. In the end, a bankruptcy is legal proceeding and your rights can be affected if your case is not handled properly. Only a bankruptcy attorney is qualified to advise on the bankruptcy law and to properly file your case. Not a paralegal or a petition preparer.  

 

26. If I declare bankruptcy, can I lose my house?

 

Yes you can. However, in the overwhelming majority of bankruptcy cases no one will lose their home as long as they keep making their monthly mortgage payments timely. Why? First, in Chapter 13 cases, the Trustee of the bankruptcy court does not sell your property. Chapter 13 is a monthly payment plan by you and not a sales event for the Trustee.

 

In Chapter 7, one can lose one's home. But as indicated above, most people will not unless they wanted to surrender the home in bankruptcy in the first place. The bankruptcy laws have certain protections built in to protect a person's home, car, retirement accounts etc. In the law, we call these protections exemptions.

 

For a piece of real estate that is the place where you physically live this exemption is around $ 132,000.00 in value (note: this amount is adjusted up from time to time but your attorney will tell you the exact number). Moreover, most people who own a home have a mortgage balance still owed. Both of this things prevent the bankruptcy trustee from taking someone's home.

 

Of course, you should consult with and hire a bankruptcy attorney so he or she can fully review your situation to make sure your home will not be in jeopardy in your bankruptcy case.

 

27. Who can use Chapter 7?

 

Normally Chapter 7 can be filed by corporations and individuals.

 

28. Who can use Chapter 13?

 

Normally Chapter 13 can be filed by corporations and individuals. An asset and a liability limit does exists thus requiring many corporations to file Chapter 11.

 

29. When will I be discharged from bankruptcy?

 

30. Can I get credit after bankruptcy?

 

31. What should I do if I know I am going to miss a payment?

 

32. Can I put my assets in someone else’s name before filing for bankruptcy?

 

33. How often, if ever, will I have to go to court during bankruptcy proceedings?

 

Normally only once. We call this a 'Court date' but actually the term is the "Meeting of Creditors". This hearing is where your case is reviewed by a bankruptcy trustee, an attorney appointed by the Court, to determine that your case is in good order. Once the Trustee has completed the review of your case,(around 15 minutes) you are free to go and will likely not have another 'Court date" again in your case.

 

You would only have additional meetings with the Trustee or go before the Bankruptcy Judge if you have a more complicated case or one of your creditors objects to your case. This does not normally exists for most of the cases that are filed, and your case will likely go the same way.

 

Of course, hiring an experienced bankruptcy attorney will insure that your case will be handled properly and if you are require to go to more than one meeting or court appearance you will be ready and your case will be completed properly.

 

34. What should I include on my assets schedule for bankruptcy?

 

The short answer. Everything. When you petition the bankruptcy court to either discharged your debt completely in Chapter 7, or enter into a structured repayment plan in a Chapter 13, you are required to provide a complete financial disclosure. There is no picking and choosing in the bankruptcy world.

 

If you hear someone say that, 'well, I did not put that in my bankruptcy case or I did not list that' (whether it was an outstanding debt or some piece of property or money). That person is mistaken or they misrepresented information to the bankruptcy Court----maybe just by accident, and if they did so intentionally then that introduces the possibility of bad behavior.

 

You will not being doing that when you hire an experienced,professional bankruptcy attorney.  Please know that because you list everything, you property and money and debts you still want to pay, does not mean that you will lose those things. Again, a good attorney will explain the different meanings of the things in the bankruptcy world---some of which is explained in this frequently asked question section. When you hire a good attorney you will know exactly how to proceed with your case properly and achieve the right to debt relief the bankruptcy law provides.  

 

35. How do bankruptcy attorneys charge for their services?

 

Normally, bankruptcy attorneys charge a flat fee for the work they perform on you case. Sometimes, if the case is more complicated you can be charged an hourly rate. Once you have a full, in the office, consultation with an attorney, he or she will be able to tell you what type of fee terms will be in place and what the overall total expense for the case likely will be if an hourly rate, and the exact fee if the case is a flat fee case---most of the cases are flat fee.

 

36. If I declare bankruptcy, can I lose my car?

 

Yes it is possible to lose your car in a Chapter 7 case. But again, as with the example above regarding a house, in the overwhelming majority of cases of Chapter 7 you do not lose your automobile. Again two reasons: 1) Most people have liens on their vehicle (your car payment balance) and 2) The law protects a certain amount of value that your car might have.( At this time that amount exceeds $ 3,600.00 in Ohio and is revised upward from time to time.)

 

When you consult with and hire an experience bankruptcy attorney he or she will be able to fully advise you of the effects, if any, of filing bankruptcy with a vehicle.

 

37. What are the most common reasons for Chapter 7 bankruptcy?

 

Normally, most people need the bankruptcy laws for help because something has happen in their life that was unexpected: 1) A job loss 2) large medical expenses or 3) a divorce and other events. These things can happen to anyone and thus the U.S. Congress put the bankruptcy laws in place to help people with these events.

 

Bankruptcy laws are not meant to punish you for any behavior or event that has happen in your life. As long as you gave your best efforts you are entitled to a fresh financial start in Chapter 7 and a fresh start in Chapter 13 after paying back some of the debts you owe.  

 

38. What are the most common reasons for Chapter 13 bankruptcy?

 

The same reasons people file Chapter 7. Normally, most people need the bankruptcy laws for help because something has happen in their life that was unexpected: 1) A job loss 2) large medical expenses or 3) a divorce and other events. These things can happen to anyone and thus the U.S. Congress put the bankruptcy laws in place to help people with these events.

 

Why someone does Chapter 13 versus not doing a Chapter 7 case requires a lawyer to looks at several factors, some listed in this frequently asked question section. Please consult and hire an experience bankruptcy lawyer who can guide you on whether filing a Chapter 13 or Chapter 7 case is best in your situation.

 

39. Will my co-signers on my liabilities, like a mortgage, be protected if declare bankruptcy?

 

In Chapter 7 the co-signer will be protected if you sign a reaffirmation agreement with the common creditor that you owe money to along with the co-signer. Yet, as covered above, you will only sign a reaffirmation agreement connected to an automobile or a home, not on credit cards. Remember, there might be reasons that you do not sign a reaffirmation agreement even on an automobile and a home. (the main reason is you cannot continue to make the payments!)Again, whether or not you should sign a reaffirmation agreement will require guidance by your attorney.

 

Of course, nothing stops you from voluntarily paying any debts you incurred before the bankruptcy after the bankruptcy case is over. If you absolutely need to protect a cosigner then this option is possible. Most creditors, despite the fact that they can no longer sue you on the old debt, will be more than happy for you to pay them voluntarily on that old debt.(Note: if the payments do not keep the account current, they might still sue your cosigner anyway.)

 

In Chapter 13, the plan can be set up to protect the cosigner from any collection activity despite you filing bankruptcy. This requires guidance by your attorney and will depend on several factors. Hiring an experience bankruptcy counsel will insure that you know all your rights and options in the bankruptcy process.

 

40. What debts are erased by a bankruptcy, and what debts cannot be erased by bankruptcy?

 

Most debts are eliminated after you file Chapter 7 bankruptcy. Typically, credit cards, medical bills, repossessed vehicles, or any debts connected with property that is voluntarily surrendered in the bankruptcy by you.

 

Some of the debts that are not typically discharged are most taxes, child support, criminal fines student loans etc..

 

In Chapter 13, the repayment plan will result in all of your debt receiving some money back before you receive a discharge on the remaining balance. Likewise,there are some debts that are not discharged in Chapter 13 as listed above in Chapter 7.

 

41. Is the debt discharged in bankruptcy considered income that has to be reported on my income tax return?

 

Generally no. You should ask your lawyer and accountant for further details on this matter.

 

42. Does a previous bankruptcy prevent me from filing bankruptcy again?

 

It depends. You can only file Chapter 7 once every 8 years. You may file Chapter 13 more often. You must have a bankruptcy attorney review your entire situation before you attempt to file multiple Chapter 13 bankruptcies within a relatively short period of time. The Bankruptcy Court does not want the bankruptcy laws abused.

 

For every Chapter 13 filing the Court will look to see if there is an abuse of process simply due to the multiple filings. Again, you must hire an experienced bankruptcy attorney to review your entire situation before an answer can be given. You must be careful to not harm your bankruptcy rights by filing careless multiple bankruptcies.  

 

43. Can I file bankruptcy only on my personal or just on my business debts?

 

All debts are listed in your bankruptcy case. It is a complete financial disclosure when you file bankruptcy. As discussed in this FAQ section, some debts may be excluded from the bankruptcy discharge by signing a reaffirmation agreement, and, of course, one can simply voluntarily continue to pay certain debts after your bankruptcy is over.

 

Again, a full discussion with your bankruptcy attorney is best when deciding to reaffirm on debts or voluntarily pay back debt after your bankruptcy filing.

 

44. Will bankruptcy stop wage garnishments?

 

Yes, when you file bankruptcy the Bankruptcy Court issues an automatic stay, which is a court order. This order of the Court will stop a wage garnishment in almost all cases.

 

45. How does a Chapter 13 bankruptcy case begin?

 

A Chapter 7 and Chapter 13 case all begin with the same process. You and your lawyer will sit down together for several appointments to review your entire financial situation. This will also involve a review of your financial life over the last several years. Your attorney's job is to prepare your case for review by a Chapter 7 or Chapter 13 Trustee--the attorney appointed by the Bankruptcy Court to review your case once filed.

 

You will bring to your lawyer's office all relevant financial documents like tax returns, pay information, bank statement, a list of the people you owe etc...After collecting all this information and preparing your bankruptcy schedules your case will be ready for filing.  

 

46. If I file for bankruptcy, does it mean my old bad debts are erased from my credit report?

 

We often get this question? You have to understand what a bankruptcy discharge of debt is and what is the purpose of a credit report. A credit report is nothing more than a history of the debts you have owed, the amounts owed, and the history of the payments you made on those debts.

 

A bankruptcy discharge is an Order by the Bankruptcy Court that legally prevents creditors from suing you in a court of law to collect on any of the debts you owed before the filing of the bankruptcy case.

 

(This assumes that all the debts you owe are dischargeable by the Court in the first place, see above and consult with your lawyer)

 

The bankruptcy discharge does not 'erase' the history of what debts you once had and how you paid them. It simply prevents the creditors from suing you for collection or otherwise collecting through collection letters and phone calls. But the history of the debts you once had remain.(Though overtime the credit reports drop off certain debts simply due to their age.)

 

But what is important is that your current credit report reports the bankruptcy discharge. That way any one looking at your credit report will know that the debts that existed prior to the bankruptcy filing are the ones you are no longer legally responsible for because of the bankruptcy discharge. Your credit rating will improve as you move on from your bankruptcy filing. (See above)

 

 

47. Can the bankruptcy court decide tax disputes?

 

Yes. But only as it relates to whether the taxes owed are dischargeable under the bankruptcy code. The issue of taxes in bankruptcy is a complex area of law and will require that you hire an experienced bankruptcy attorney to determine what taxes are or are not dischargeable.

 

48. How do I determine if should file bankruptcy?

 

A simple test follows: First, total all the debt you have in dollar amounts. Second, contact the people you owe (your creditors) and follow these four steps: 1) Ask for your balances owed to be reduced 2) Demand that your creditors reduced or eliminate the interest rate on your balances 3) Demand a monthly payment that fits within your budget, and 4) Now ask the following question:

 

Can I expect to pay off all my debts within a reasonable period of time given my current income (and likely expected increases in income) and your current monthly expenses under a payment plan you have, or are trying, to set up with your creditors?

 

If no, or if you are already being sued by one of your creditors in court, then it is best to talk to an experienced bankruptcy attorney.

 

49. Do bankruptcy laws vary from state to state?

 

Yes and no. The main bulk of bankruptcy law is Federal law. Thus, the bankruptcy laws are virtually the same among all of the fifty states. However, there are parts of the bankruptcy code that allow the states to fill in certain provisions of the law if the federal bankruptcy law allows it.

 

The main part of the law that is state law created is the exemption provisions. As noted in the earlier questions above, the exemptions are those aspects of the law that allow a person that filed a Chapter 7 to protect certain money and property from being taken by the bankruptcy trustee. See question 11.

 

50. In bankruptcy, what is the trustee?

 

The bankruptcy trustee is a person, normally a lawyer, appointed by the bankruptcy code to oversee your bankruptcy case. In a Chapter 7, the trustee's main job is to not only review your case but to determine if there are any assets (money or property) that you own that could be sold to raise money in order to pay back some of your creditors there outstanding balances.

 

In a Chapter 13 bankruptcy, the Trustee does not attempt to sell any of your money or property but does review your monthly income and expenses in order to determine what monthly payment you shall pay into your Chapter 13 Plan. This payment plan normally pays back only some of the balances owed to your creditors and discharges the rest of the balances at the end of the case.  

 

51. Who will know about my bankruptcy?

 

All court proceedings are public information. Bankruptcy Court is no different. However, unless someone is really looking at the court records for a particular bankruptcy case then no one will know about your case. (Unless you tell them) Remember, the bankruptcy laws are there to help you not to harm you.  

 

52. How much will the whole bankruptcy process cost?

 

Generally, the Chapter 7 bankruptcy will costs around $600 to $800 for attorney fees and around $300.00 for court costs. The attorney fees portion might be substantially more if you have a more complicated bankruptcy filing.

 

Generally, the Chapter 13 bankruptcy filing will be around $1,500.00 to $2,000.00 plus around $300.00 court costs. Again, the attorney fees portion might be more if you have a more complicated bankruptcy filing.

 

53. What is the proposed payment plan?

 

This is for Chapter 13 cases only. The proposed monthly payment plan is the monthly payment you will make to the Chapter 13 Trustee in order for your debts to be paid in the amounts determined by the chapter 13 plan. That specific monthly amount will depend on your income and budget levels.

 

54. What happens after the payment plan is approved?

 

Your creditors are now bound by the terms of the plan and will be discharged at the end of the plan after you have made all required payments.

 

55. What will happen to my bills after I declare bankruptcy?

 

In Chapter 13, all the debts you have will be under the provision of the chapter 13 plan and will be discharged upon the completion of all your payments into the plan. You will maintain, outside of the chapter 13 plan, payments for your necessary ongoing monthly payments...i.e. your monthly food bill, power bill etc...

 

In Chapter 7, all of the debts you were behind, or had a balance on, before the bankruptcy filing will be immediately discharged. (Except certain debts like student loans...etc…) You, of course, will have to continue to make payments for your ongoing monthly bills into the future.

 

56. What are the most common mistakes I can make when filing for bankruptcy?

 

57. What are the advantages of filing for bankruptcy?

 

58. Who notifies the creditors and bill collectors that I declared bankruptcy?

 

59. What if I cannot afford the whole bankruptcy process?

 

60. Is the IRS affected by my bankruptcy filing? Do I still have to pay back taxes and new taxes?

 

61. How does a Chapter 7 bankruptcy case begin?

 

62. What is the role of the Chapter 13 trustee in a bankruptcy?

 

63. Can I file for bankruptcy if I haven’t paid taxes for the last few years?

 

64. What are the disadvantages of filing bankruptcy?

 

65. Does my spouse have to file bankruptcy with me?

 

66. What should I list as my liabilities in a Chapter 7 bankruptcy?

 

67. Does the IRS have to agree to my Chapter 13 plan?

 

68. Can I repay debts owed to relatives before filing for bankruptcy?

 

69. Can my utility providers stop service if I file bankruptcy?

 

70. Can my ex-spouse avoid paying child support if they file for bankruptcy?

 

71. Will I lose my assets if I file for Chapter 7?

 

72. Can I convert from a Chapter 13 to 7 bankruptcy?

 

73. How long will a bankruptcy filing remain on my credit record?

 

74. What are exempt assets in a bankruptcy proceeding?

 

75. What if the court does not approve my Chapter 13 bankruptcy filing?

 

76. What are nonexempt assets in a bankruptcy proceeding?

 

77. How difficult is it to file for Chapter 7 under the new bankruptcy laws?

 

78. What are the main effects of filing bankruptcy under Chapter 13?

 

79. What if I forget to list a liability in my bankruptcy filing?

 

80. Can I save my home and other assets by filing for bankruptcy under Chapter 13?

 

81. What if I cannot make the payments on my Chapter 13 bankruptcy plan?

 

82. What if the court does not approve my Chapter 7 bankruptcy?

 

83. Can I convert from a Chapter 7 to 13 bankruptcy?

 

84. Can I use Chapter 7 bankruptcy to get rid of all my debts?

 

85. What are the alternatives to filing personal bankruptcy?

 

86. I do not have much money. Why should I hire a bankruptcy attorney instead of filing myself?