Bankruptcy Information
*Note: This article is not legal advice, it is a personal opinion based on experience from the author. If you are seeking legal advice please check with your local bankruptcy attorney.
Bankruptcy is referred to as a reorganization or liquidation process. All entities with debt can go to federal bankruptcy court. It’s not hard to qualify for debt elimination. You can choose to repay some of what you owe. If you could would you liquidate what you own. Valuables that could not be covered by a federal exemption will go to auction to cover some of your debt. Chapter 7 lets a person liquidate assets. A variety of individuals would rather reorganize their debt. This means you can keep all your property while making payments for 3 to 5 years. Most or all debt will be cleared with this choice. Many people choose a chapter 13 filing so they can reorganize their debt.
Chapter 7 bankruptcy
If you file for bankruptcy you are known as the debtor. The reason people choose to file a chapter 7 bankruptcy is to release most or all their debt. Any debt included in your discharge will not have to be repaid. A discharge wipes away most debt except for some items held under a lien. In a lien situation you still have to pay the debt or be forced to release the property to the lien holder. When your bankruptcy is discharged creditor wont harass you by phone or mail. Some unsecured debt and old medical expenses can’t be paid back in this case chapter 7 bankruptcy will be an option for you.
Chapter 13 bankruptcy
For chapter 13 bankruptcy a debtor will file a payment plan with the federal courts to pay back some or all the debts that they owe, over a three to five year period. If you need your property file a chapter 13 bankruptcy. Included is valuable items with a balance and equity your federal exemption won’t cover. The courts may order you to make payments towards your secured debts. A chapter 13 bankruptcy allows you to keep your house and car. Debtors can keep some property by making payments over time.
Does the federal court allow more than one bankruptcy?
If you rack up more bad debt after a chapter 7 bankruptcy you can’t file again for 6 years. If you already filed a chapter 13 you can file again whenever you like. Surprisingly chapter 7 only costs $ 200. For a chapter 13 bankruptcy you will pay a $ 155 filing fee and a $ 30 noticing fee. In the case of a spousal joint petition the fees won’t change.
How many court dates will there be?
If you want to file you must attend a proceeding called a meeting of creditors or a 341 meeting. Creditors may or may not come but you will meet a bankruptcy trustee for sure. This event can happen as early as 40 days from filing. You will be asked some questions about your financial issues at this meet. At this meeting a motion or adverse action can be filed. If you need to dispute any debts this would be where you would petition for it. You will be notified of any additional court dates in writing.
What can I expect after filing bankruptcy?
If you are buried in debt a bankruptcy won’t make much difference. A bankruptcy may actually be less damaging than your history of unpaid debts. A bankruptcy will plague you for 10 years. After bankruptcy you will be a very popular candidate for new credit even if they say that your credit score will be affected for 10 years. Are you a person who just needs a fresh start. Living life in debt is no life. After you file bankruptcy you will want to make wise money decisions. Regrettably lots of people were not taught how to use money responsibly. Sometimes the happens because you lost your job and your bills kept coming leaving you in a desperate state. Its torture to be stuck with debt but you can find relief and make wiser choices in the future.
