Filing Bankruptcy

Bankruptcy stays on your credit record for ten years. However, most people are able to obtain creditor shortly after they complete filing bankruptcy and sometimes even while they are in bankruptcy. Generally, it is possible to get a good rate on a home mortgage two years after you file Chapter 7 bankruptcy, assuming you qualify in all other respects. If your credit is already bad, bankruptcy may improve it.

The filing of a bankruptcy petition creates an automatic court order against your creditors from collecting from you. As soon as your bankruptcy is filed, creditors must stop judgments, wage garnishments, evictions, foreclosures, telephone calls, and even billing statements.

Your spouse does not have to file bankruptcy jointly with you. If the debts are in your name only, there is no reason for your spouse to file with you.

It is very rare that filing bankruptcy causes a problem with renting a home or apartment. With millions of bankruptcy cases filed in recent years, it is obvious that people who file bankruptcy are able to find a place to rent. Generally, landlords will take into account prior rental history.

There is no set amount of debt for filing bankruptcy. One thing to consider is whether you are able to pay more than the minimum monthly payments on your credit cards. If you pay only the minimum payments, you will be in debt for many years. The high interest rates and penalties can make it impossible to work your way of the debt. Taking a second job is not always an option. Repossessions, foreclosures, judgments, wage garnishments and bank levies are all possible indications that you have a serious debt problem and need to file for bankruptcy protection.

There is no set amount of debt for filing bankruptcy. One thing to consider is whether you are able to pay more than the minimum monthly payments on your credit cards. If you pay only the minimum payments, you will be in debt for many years. The high interest rates and penalties can make it impossible to work your way of the debt. Taking a second job is not always an option. Repossessions, foreclosures, judgments, wage garnishments and bank levies are all possible indications that you have a serious debt problem and need to file for bankruptcy protection.

The bankruptcy process begins with a consultation at our office. We gather information to draft the paperwork and we explain the bankruptcy process. In addition, we give you a list of approved credit counseling agencies. You must consult with one of the agencies for a credit counseling briefing. This can be done for a small fee in person, by telephone, or internet. You will receive a certificate which you will give to us to file with your bankruptcy papers. After we file the bankruptcy, you will take a short financial management course by an approved credit counseling agency. This can also be done over the internet or by telephone for a small fee. About a month after the bankruptcy papers are filed, we will have a short meeting with the bankruptcy trustee. In a Chapter 7 case, creditors have 60 days after the hearing to contest the elimination of a debt on certain limited grounds, such as fraud. Once the 60 day period expires, the court enters an order discharging your debts. At that point, all of your dischargeable debts are eliminated and no longer owed. In a Chapter 13 case, discharge occurs when you complete your debt consolidation payments. Until that time, you are protected from collection efforts.

We can send you worksheets that cover the information that we need to complete your bankruptcy papers. When you sign the completed bankruptcy papers, you are signing under penalty of perjury that the information is both true and complete. Be sure to tell your attorney everything. Do not try to hide anything because bankruptcy fraud is a federal crime.

A reaffirmation agreement can be made in a chapter 7 case. A reaffirmation agreement is an agreement to repay a debt and take it out of bankruptcy so that it will still be owed at the end of the case. This is normally done with debts that are collateralized. For instance, you might want to reaffirm a mortgage or a car loan. You would agree to continue to be responsible for the payments on the loan; as a result, the creditor would agree to allow you to keep the collateral. In a chapter 13 case, reaffirmation is not necessary because a repayment plan is filed with the court.