General Bankruptcy Information
The benefits of Bankruptcy:
When a person files for bankruptcy it is usually because of being unable to handle an overwhelming
amount of debt. Although most individuals find it hard to confront having to file, there are many benefits
to handling your debt in this manner. Whether you file a Chapter 7 or Chapter 13, there are specific
benefits to each. One immediate benefit is that your creditors are generally required to stop contacting
you at once, upon being notified of a filing. All legal actions, repossessions, foreclosure proceedings,
holds on your bank accounts or wage garnishments must stop as the bankruptcy process goes through.
That means relief for you - from the stress and worry you have been living through.
Other benefits to you of filing bankruptcy include a discharge of most all of your debt in a Chapter 7 filing
and a reasonable and affordable restructuring of your debt with a Chapter 13. Both will allow you to get
back in control of your finances and look forward to the future.
Types of debt eliminated:
If you are one of the millions of Americans suffering from an overwhelming debt load which includes tax
bills, mortgage payments, credit card debt, medical debt, and personal loans, you are not alone. More
and more families are having a difficult time keeping up with their payments due to the loss of a job,
divorce, or other unforeseen circumstances. Some of the types of debt you can eliminate with either a
Chapter 7 or Chapter 13 filing include:
- Credit card debt
- Medical bills
- Department store bills
- Personal loans
There are certain types of debt that cannot be discharged in a bankruptcy and must still continue to be
paid regardless of a bankruptcy filing. These include:
- Child support
- Spousal support payments
- Most student loans
- Most income taxes
- Property taxes
- Court-ordered fines or penalties
What may you lose in Bankruptcy:
When filing for bankruptcy protection, you are able to discharge or restructure a lot of your debt. A
bankruptcy filing has restrictions on assets you can keep. Your credit record will be somewhat impacted
by the filing, although will improve as time passes form the date you filed.
While Chapter 7 bankruptcy allows you to discharge almost all your debts with the exception of exempted
debts such as child support or income taxes, certain assets you own may be liquidated in the bankruptcy
process to offset any creditor losses. You must turn over any such property to the Bankruptcy Trustee,
who will sell it to pay creditors. Many times there are few assets available to liquidate over the exempted
assets you are allowed to keep. Below are assets you may lose in a Chapter 7 Bankruptcy.
- Recreational vehicles
- Your primary residence, if your are unable to maintain your mortgage payments. If you are current on
your payments and can continue to make payments, you will likely be able to keep your home.
- A second home or land
- Any inheritance received within 6 months of filing bankruptcy
- Any cash on hand or checking or savings accounts are usually taken in Chapter 7 bankruptcy
proceedings except for a minimal amount you are allowed to keep.
Chapter 13, as it allows for restructuring of your debt, does not seize your assets as long as you complete
your repayment plan. However, if you fail to complete the repayment plan, you could lose some of your
assets. In general, these are the main points which effect you when filing a Chapter 13:
- All available income must be used for repayment of your debts.
- You will pay higher legal fees for a Chapter 13 due to its complexity.
- You will be tied to a strict payment plan for 3 to 5 years, depending on you restructured it.
- You are involved in the bankruptcy court process for the entire term of the 3-5 year plan.
Bankruptcy time line
There are different time lines for how long your bankruptcy will take depending on what type of bankruptcy
you file. In brief, the time line is generally as follows:
Your time line will begin when you file your petition with the Bankruptcy Court. However, there are a few
restrictions which may apply prior to filing that are important. You must be a resident of the district for at
least 90 days prior to filing. You must also obtain counselling from a certified credit counseling agency
no earlier than 180 days prior to filing.
If you have ever filed a Chapter 7 before, you must wait 8 years from the date of your discharge before
you can file again. If you have filed a Chapter 13 previously, you may be eligible to file 6 years after your
discharge. If you filed for a Chapter 7 previously but now need to do a Chapter 13, you must wait at least
4 years from the date of your last discharge.
The first step in any type of bankruptcy filing is to gather all the information about your debts, assets,
income and expenses. Our office will work with you to put this together. Once all information is
gathered, our office will file the legal petition with supporting schedules and statements.
30 days after filing for a Chapter 7 you must file a Statement of Intention, which states which, if any, debts
you wish to reaffirm (Basically, which debts you will keep in order to keep property, such as a car that has
a loan still owing on it).
30 days after filing for your Chapter 13 repayment plan with the Bankruptcy Court, you must make your
first scheduled payments on your debt.
Within 45 days of your filing there will be a Meeting of Creditors.
In a case where there are no assets, approximately 5 to 6 months after your filing for Chapter 7 your
debts will be discharged and your bankruptcy will be finalized.
3 to 5 years after you filing Chapter 13 and having made your payments under the payment plan, you will
receive a discharge from the Bankruptcy Court. All eligible debts will be discharged at this point.
When a person files for bankruptcy it is usually because of being unable to handle an overwhelming
amount of debt. Although most individuals find it hard to confront having to file, there are many benefits
to handling your debt in this manner. Whether you file a Chapter 7 or Chapter 13, there are specific
benefits to each. One immediate benefit is that your creditors are generally required to stop contacting
you at once, upon being notified of a filing. All legal actions, repossessions, foreclosure proceedings,
holds on your bank accounts or wage garnishments must stop as the bankruptcy process goes through.
That means relief for you - from the stress and worry you have been living through.
Other benefits to you of filing bankruptcy include a discharge of most all of your debt in a Chapter 7 filing
and a reasonable and affordable restructuring of your debt with a Chapter 13. Both will allow you to get
back in control of your finances and look forward to the future.
Types of debt eliminated:
If you are one of the millions of Americans suffering from an overwhelming debt load which includes tax
bills, mortgage payments, credit card debt, medical debt, and personal loans, you are not alone. More
and more families are having a difficult time keeping up with their payments due to the loss of a job,
divorce, or other unforeseen circumstances. Some of the types of debt you can eliminate with either a
Chapter 7 or Chapter 13 filing include:
- Credit card debt
- Medical bills
- Department store bills
- Personal loans
There are certain types of debt that cannot be discharged in a bankruptcy and must still continue to be
paid regardless of a bankruptcy filing. These include:
- Child support
- Spousal support payments
- Most student loans
- Most income taxes
- Property taxes
- Court-ordered fines or penalties
What may you lose in Bankruptcy:
When filing for bankruptcy protection, you are able to discharge or restructure a lot of your debt. A
bankruptcy filing has restrictions on assets you can keep. Your credit record will be somewhat impacted
by the filing, although will improve as time passes form the date you filed.
While Chapter 7 bankruptcy allows you to discharge almost all your debts with the exception of exempted
debts such as child support or income taxes, certain assets you own may be liquidated in the bankruptcy
process to offset any creditor losses. You must turn over any such property to the Bankruptcy Trustee,
who will sell it to pay creditors. Many times there are few assets available to liquidate over the exempted
assets you are allowed to keep. Below are assets you may lose in a Chapter 7 Bankruptcy.
- Recreational vehicles
- Your primary residence, if your are unable to maintain your mortgage payments. If you are current on
your payments and can continue to make payments, you will likely be able to keep your home.
- A second home or land
- Any inheritance received within 6 months of filing bankruptcy
- Any cash on hand or checking or savings accounts are usually taken in Chapter 7 bankruptcy
proceedings except for a minimal amount you are allowed to keep.
Chapter 13, as it allows for restructuring of your debt, does not seize your assets as long as you complete
your repayment plan. However, if you fail to complete the repayment plan, you could lose some of your
assets. In general, these are the main points which effect you when filing a Chapter 13:
- All available income must be used for repayment of your debts.
- You will pay higher legal fees for a Chapter 13 due to its complexity.
- You will be tied to a strict payment plan for 3 to 5 years, depending on you restructured it.
- You are involved in the bankruptcy court process for the entire term of the 3-5 year plan.
Bankruptcy time line
There are different time lines for how long your bankruptcy will take depending on what type of bankruptcy
you file. In brief, the time line is generally as follows:
Your time line will begin when you file your petition with the Bankruptcy Court. However, there are a few
restrictions which may apply prior to filing that are important. You must be a resident of the district for at
least 90 days prior to filing. You must also obtain counselling from a certified credit counseling agency
no earlier than 180 days prior to filing.
If you have ever filed a Chapter 7 before, you must wait 8 years from the date of your discharge before
you can file again. If you have filed a Chapter 13 previously, you may be eligible to file 6 years after your
discharge. If you filed for a Chapter 7 previously but now need to do a Chapter 13, you must wait at least
4 years from the date of your last discharge.
The first step in any type of bankruptcy filing is to gather all the information about your debts, assets,
income and expenses. Our office will work with you to put this together. Once all information is
gathered, our office will file the legal petition with supporting schedules and statements.
30 days after filing for a Chapter 7 you must file a Statement of Intention, which states which, if any, debts
you wish to reaffirm (Basically, which debts you will keep in order to keep property, such as a car that has
a loan still owing on it).
30 days after filing for your Chapter 13 repayment plan with the Bankruptcy Court, you must make your
first scheduled payments on your debt.
Within 45 days of your filing there will be a Meeting of Creditors.
In a case where there are no assets, approximately 5 to 6 months after your filing for Chapter 7 your
debts will be discharged and your bankruptcy will be finalized.
3 to 5 years after you filing Chapter 13 and having made your payments under the payment plan, you will
receive a discharge from the Bankruptcy Court. All eligible debts will be discharged at this point.
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