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Frequently Asked Questions:
(Click on any topic below)
1. Can I keep any of my credit cards?
2. Can I keep my car, truck or van?
3. Will my employer be notified if I file bankruptcy?
4. Will I lose my job if I file bankruptcy?
5. How often can one file a bankruptcy?
6. If I file bankruptcy, does my spouse have to file bankruptcy with me?
7. What happens to my spouse's credit if I file bankruptcy?
8. Will I lose my house?
9. What happens to my job?
10. Can all my debts be discharged?
11. When will my creditors stop calling me?
12. Why should I file?
13. Won't my credit be ruined?
14. Why is it so difficult to pay off a credit card?
15. Will filing a bankruptcy stop a wage garnishment?
Can I keep any of my credit cards?
In almost every situation, your credit card will be canceled. Your credit card may even be canceled if you have a zero balance. It is solely the decision of the credit card company whether you will be allowed to continue to charge on their credit card. If you are interested in keeping a credit card, you should contact the company after the bankruptcy has been filed. If they will allow you to continue to use the card, tell them to forward to our office a "reaffirmation agreement". This agreement obligates you to pay the credit card company but will allow you to use the card.
Can I keep my car, truck or van?
Most people who file Chapter 7 can keep their car, truck or van, whether paid, leased or financed. The vehicle's value and the amount due on the loan, if any, will determine whether the vehicle can be retained under a Chapter 7, or whether a Chapter 13 should be filed in order to keep the vehicle.
Will my employer be notified if I file bankruptcy?
The Clerk of the Bankruptcy Court sends notices to all creditors that you have filed a bankruptcy. A notice is not sent to your employer. However, if your wages are being garnished, your employer will need to know that you filed since the filing of the bankruptcy will stop the garnishment.
Will I lose my job if I file bankruptcy?
No. The United States Bankruptcy code prohibits discrimination by an employer just because you filed bankruptcy.
How often can one file a bankruptcy?
A Chapter 7 can be filed eight (8) years after a discharge in a previous Chapter 7, or six (6) years after a discharge in previous Chapter 13, if more than 70% of claims were paid and the plan was proposed in good faith. A Chapter 13 can be filed four (4) years after a discharge in a previous Chapter 7, or two (2) years after a discharge in a previous Chapter 13 case. It is not allowed to have two bankruptcies open or pending at the same time.
If I file bankruptcy, does my spouse have to file bankruptcy with me?
No. It is not required that your spouse join in on your bankruptcy. However, it may be beneficial for your spouse to join you depending upon the particular Chapter under which you are filing and the nature of your debts.
What happens to my spouse's credit if I file bankruptcy?
If you do not have joint debts with your spouse, his/her credit will not be affected. If there are any joint debts, your bankruptcy will appear on your spouse's credit report and it will affect his/her credit score
Will I lose my house?
Many people are eligible to file a Chapter 7, even if they own a house, depending on the market value of the house and the size of the mortgage. If your house has too much value, it may be necessary to file a Chapter 13.
What happens to my job?
Chapter 7 bankruptcy has no effect upon your job. You have a legal right to file a Chapter 7 and your employer does not have to know that you have filed.
Can all my debts be discharged?
Chapter 7 Bankruptcy will discharge most debts.
For example:
- Bank credit cards
- Utility bills
- Doctor and hospital bills
- Personal loans
- Department store credit cards
- Mail order and catalogue purchases
- Loan balances due on repossessed automobiles
But, Chapter 7 will NOT discharge the following:
- Student loans
- Domestic support obligations including but not limited to child support and alimony
- Most types of taxes
- Most obligations to governmental entities, including parking tickets
- Debts incurred through fraud or willful and malicious injury
- Debts incurred as a result of death or personal injury caused by vehicle operation while under the influence of alcohol or other illegal substances
However, some debts owed to the IRS can be discharged in a Chapter 7.
When will my creditors stop calling me?
After you file bankruptcy you won't be afraid to answer the telephone! At the exact moment that a Chapter 7 or a Chapter 13 Bankruptcy is filed, there is a special Court Order of Protection that comes into existence. It is called the "AUTOMATIC STAY". The Automatic Stay protects you against all types of collection activities.
It STOPS bills, lawsuits, repossessions, foreclosures, IRS liens, and yes, those nasty telephone calls from bill collectors.
Why should I file?
If you are unable to make the monthly payments on your credit cards or your furniture bills...If your automobile is about to be repossessed or has been repossessed...If your house is being foreclosed...If your wages are being garnished...If you owe money to the IRS...If you have a student loan and cannot make the monthly payments...If a creditor is suing you in a court of law, or if a creditor has obtained a judgment against you and you are unable to or do not want to pay the judgment...
If any of the above situations apply to you, or if you are having any other financial difficulties, a Chapter 7 Bankruptcy or a Chapter 13 Wage Earner Plan may be the long sought answer to your financial problems.
How does Bankruptcy effect my credit?
Bankruptcy is a wonderful law. It can help you either eliminate most of your debts with a Chapter 7, or pay them back through affordable monthly payments with a Chapter 13.
Bankruptcy will provide you with a FRESH FINANCIAL START.
The credit ratings for most people that file Bankruptcy are not that good. By eliminating your debts with a Chapter 7 or paying them back with a Chapter 13, your future creditors will know that you are no longer responsible for the debts that you had. We have had numerous Bankruptcy clients hire us a few years after their Bankruptcy has been completed to represent them for the purchase of a home. Bankruptcy is not the end of your credit life.
Why is it so difficult to pay off a credit card?
Let's say that you have a credit card balance of $3,900.00 and that the card has an annual interest rate of 18%. If you are current with your payments, the minimum monthly payment required to keep your account current should be $78.00
If you continue to pay just the minimum monthly payment, and if you make no further charges on the card until you pay off the balance, it would take 35 YEARS to pay off the balance and the total interest paid would be $10,096.00!
Will filing a bankruptcy stop a wage garnishment?
The filing of a bankruptcy petition, whether Chapter 7 or Chapter 13, operates as a "stay", stopping all collection activity against you by creditors, including wage garnishment. A creditor cannot start a wage garnishment once a bankruptcy petition has been filed, and a creditor must stop a wage garnishment once a bankruptcy petition has been filed.
Bankruptcy. Personal Bankruptcy Information - Complete U.S. bankruptcy information. Business Bankruptcy Predictor; Bankruptcy Exemptions for all States; Lawyer Locator; Do it Yourself Bankruptcy; Bankruptcy Statistics; Bankruptcy News and more.
This may be considered an advertisement or Advertising Material under the Rules of Professional Conduct. This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship.
Joseph Wrobel Ltd. is a federally designated debt relief agency pursuant to Title 11 of the US Code. We provide legal assistance and help people file for bankruptcy relief under the Bankruptcy Code. This site was designed to answer those questions that are keeping you up nights. We will provide you with pertinent and timely information concerning bankruptcy. |
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