Frequently Asked Questions About Bankruptcy
What is bankruptcy?
Under what conditions can I file bankruptcy?
Can all my debts really disappear if I file for bankruptcy?
Can I keep anything after bankruptcy?
How do I begin to file for bankruptcy?
What does Chapter 7 and Chapter 13 mean?
Do I have to stop using my credit cards right away?
Can my spouse and me file for bankruptcy together?
I’m divorced; do I have to pay the debts we owed as a married couple or that my spouse owes?
Is my Social Security and retirement money included in my bankruptcy?
Can I lose my home if I file for bankruptcy?
How long does my bankruptcy stay on my record?
Can I remove my bankruptcy from my credit report?
When can I get a credit card again?
Can my creditors still bother me after my bankruptcy?
What if I decide I can repay some of my debt?
Can my bankruptcy case ever be reopened again?
 
What is bankruptcy?
Bankruptcy lets you “discharge” your debt when you owe “creditors” more money than you’re able to pay.
 
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Under what conditions can I file bankruptcy?
If you owe money you can file a bankruptcy petition.
 
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Can all my debts really disappear if I file for bankruptcy?
It depends on which chapter of bankruptcy you file. But here is a list of debts that will not go away:
• Local, state and federal government taxes.
• Loans for money, property refinancing etc. that you got if you didn’t fill out the applications truthfully.
• Alimony, maintenance or child support payments issued by a divorce court.
• Court judgments (including DWI) for malicious injury caused by you to another person.
• If you can’t prove hardship, education loans have to be repaid.
• Debts not listed on the bankruptcy petition.
• All the debt you acquired after the bankruptcy petition was filed.
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Can I keep anything after bankruptcy?
You may be able to keep some property. Depending on what individual state laws provide, you many be able to keep some jewelry, a used car that’s not worth a lot, your home and the stuff in it, plus all of the things you need to run your business if you’re self-employed. These things you have are called assets and may still have to be listed on your financial statement form.
 
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How do I begin to file for bankruptcy?
First, make a list of all the people you owe and a list of what you have now. This is a complete statement of your finances. Then your lists are rewritten on the proper forms and become part of the bankruptcy petition along with a money order for the bankruptcy filing fee. It all goes in an envelope and is mailed to the proper court. We’ll show you exactly what you must do every step of the way so you have nothing to worry about.
 
Is there a minimum amount of money you need to owe to file for bankruptcy?
No. It doesn’t matter how much money you owe, you can still file for bankruptcy if you have no way to repay the money. However, if you only have a small amount of debt, and you have a steady job, you may decide to make a deal with the people you owe money so your debt is reduced. Then you don’t have to file for bankruptcy. There are many credit counsellors available to help you. We can refer you to the ones that are best for you.
 
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What does Chapter 7 and Chapter 13 mean?
Chapter 7, the most common form of bankruptcy, is a liquidation proceeding in which the you non-exempt assets, if any, are sold by the Chapter 7 trustee and the proceeds distributed to creditors according to the priorities among creditors established in the Code. If you file correctly, you get relief from your debts within 4-6 months from when you file. If there are assets which are not exempt, the trustee takes control of those assets, sells them and pays creditors as much as the proceeds permit. Any wages you earn after the case is filed are yours; the creditors cannot claim them.
Chapter 13. Some debts that cannot be released in Chapter 7 can be allowed in Chapter 13, a repayment plan for individuals with regular income and unsecured debt less than $336,900 and secured debt less than $1,010,650. You may keep your property and make regular payments to the Chapter 13 trustee out of future income to pay creditors in about three to five years. Repayment with Chapter 13 can be adjusted from 10% to 100% depending on your income and the type of debt. Chapter 13 also provides a way for you to avoid foreclosure and repossession while you repay your debts.
We make it easy for you and our fee is reasonable.
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Do I have to stop using my credit cards right away?
Yes. You must stop using your credit cards immediately. What you buy using your credit cards 40 days before or 20 days after you file for bankruptcy may be declared exempt from bankruptcy.
 
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Can my spouse and me file for bankruptcy together?
Yes. You can file for bankruptcy together using what is called a Joint Petition form. If you are not married, even if you live together, each of you must file an separate individual petition for bankruptcy.
 
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If I’m divorced does that mean I don’t have to pay the debts we owed as a married couple or that my spouse owes?
No. If you cosigned a loan, for example, before you were divorced you may still owe the money for the loan. Whoever doesn’t file may be responsible for all the other’s debts. Your divorce papers may spell out what you should do. Ask your divorce attorney.
 
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Is my Social Security and retirement money included in my bankruptcy?
No. Whatever is not called property by the bankruptcy court such as retirement accounts can never be taken away from you. However, you must be able to identify the money paid by Social Security. This is usually possible only if you had the Social Security payments directly deposited into your bank account.
 
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Can I lose my home if I file for bankruptcy?
If you’re not in foreclosure, no. Although some property may not be exempted. The bankruptcy trustee will determine if your property is exempted or not.
 
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How long does my bankruptcy stay on my record?
Your credit reports will show your bankruptcy only up to a maximum of 10 years.
 
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Can I remove my bankruptcy from my credit report?
No. You can only ask the credited reporting agencies to include your statement of the reasons why you had to file for bankruptcy.
 
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When can I get a credit card again?
Watch your mail. You’ll get applications for new credit cards right away. Be careful though, you’ll get into debt again and that debt won’t be protected by your previous bankruptcy.
 
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Can my creditors still bother me after my bankruptcy?
When you file for bankruptcy your petition is stamped “Relief Ordered” that means you are protected from your creditors that are accepted from your list on your petition. So all you do is send them a letter with a copy of your petition that shows the filing date, and number.
 
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How do my creditors know that I filed for bankruptcy?
The bankruptcy court notifies by mail all our creditors on your list.
 
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What’s a Section 341 meeting?
A meeting that the court Trustee who administers your bankruptcy has with you and the creditors on your petition is called a Section 341 meeting. The Trustee gets information from you relating to your bankruptcy. If you don’t fill out your petition truthfully, your bankruptcy not only will be dismissed, you may be held on perjury charges. Filling out the petition correctly is very important.
 
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Can I add any debt after I’ve submitted my bankruptcy petition?
You can file an amendment for anything that was left out or to correct a mistake, but don’t get caught in a lie for perjury. Get your petition right the first time.
 
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What if I decide I can repay some of my debt?
Use a Reaffirmation Agreement form if it becomes advantageous to repay some of your debt, such as a car loan, after filing for bankruptcy.
 
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Can my bankruptcy case ever be reopened again?
Yes. Whenever your Trustee has cause to question anything irregular about your petition such as mistakes and anything left out, your bankruptcy case will be reopened. Get your first bankruptcy petition filled out right the first time and your usually have nothing to worry about.
Bankruptcy Consulting will show you how to fill out all the forms you need yourself and then you’ll completely understand all the details of your own bankruptcy. You can save a great deal of money by not needing an attorney.
 
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