Home Archives for Filing Bankruptcy

Will Bankruptcy Affect My Credit?

Posted on January 13, 2009 Written by

There is no clear answer to this question. Unfortunately, if you are behind on your bills, your credit may already be bad. Bankruptcy will probably not make things any worse.

The fact that you’ve filed a bankruptcy can appear on your credit record for ten years from the date your case was filed. But because bankruptcy wipes out your old debts, you are likely to be in a better position to pay your current bills, and you may be able to get new credit.

If you decide to file bankruptcy, remember that debts discharged in your bankruptcy should be listed on your credit report as having a zero balance, meaning you do not own anything on the debt. Debts incorrectly reported as having a balance owed will negatively affect your credit score and make it more difficult or costly to get credit. You should check your credit report after your bankruptcy discharge and file a dispute with credit reporting agencies if this information is not correct.

Source: Answers to Common Bankruptcy Questions Pamphlet
National Consumer Law Center, Boston, MA
www.nclc.org

Remember:  The law often changes.  Each case is different.  This pamphlet is meant to give you general information and not to give you specific legal advice.

Filed Under: Filing Bankruptcy

What Else Must I Do to Complete My Case?

Posted on January 12, 2009 Written by

After your case is filed, you must complete an approved course in personal finances.  This course will take approximately two hours to complete.

Many of the course providers give you a choice to take the course in-person at a designated location, over the Internet (usually by watching a video), or over the telephone.

Your attorney can give you a list of organizations that provide approved courses, or you can check the website for the United States Trustee Program office at www.usdoj.gov/ust.

In a chapter 7 case, you should sign up for the course soon after your case is filed.  If you file a chapter 13 case, you should ask your attorney when you should take the course.

Source: Answers to Common Bankruptcy Questions Pamphlet
National Consumer Law Center, Boston, MA
www.nclc.org

Remember:  The law often changes.  Each case is different.  This pamphlet is meant to give you general information and not to give you specific legal advice.

Filed Under: Chapter 13, Chapter 7, Discharge, Filing Bankruptcy

Will I Have to Go to Bankruptcy Court?

Posted on January 11, 2009 Written by

In most bankruptcy cases, you only have to go to a proceeding called the “meeting of creditors” to meet with the bankruptcy trustee and any creditor who chooses to come.  Most of the time, this meeting will be a short and simple procedure where you are asked a few questions about your bankruptcy forms and your financial situation.

Occasionally, if complications arise, or if you choose to dispute a debt, you may have to appear at a hearing.  In a chapter 13 case, you may also have to appear at a hearing when the judge decides whether your plan should be approved.  If you need to go to court, you will receive notice of the court date and time from the court and/or from your attorney.

Source: Answers to Common Bankruptcy Questions Pamphlet
National Consumer Law Center, Boston, MA
www.nclc.org

Remember:  The law often changes.  Each case is different.  This pamphlet is meant to give you general information and not to give you specific legal advice.

Filed Under: Chapter 13, Chapter 7, Filing Bankruptcy

Will Bankruptcy Wipe Out All My Debts?

Posted on January 10, 2009 Written by

Yes, with some exceptions.  Bankruptcy will not normally wipe out:

  • Money owed for child support or alimony;
  • Most fines and penalties owed to government agencies;
  • Most taxes and debts incurred to pay taxes which can not be discharged;
  • Student loans, unless you can prove to the court that repaying them will be an “undue hardship”;
  • Debts not listed on your bankruptcy petition;
  • Loans you got by knowingly giving false information to a creditor, who reasonably relied on it in making you the loan;
  • Debts resulting from “willful and malicious” harm;
  • Debts incurred by driving while intoxicated;
  • Mortgages and other liens which are not paid in the bankruptcy case (but bankruptcy will wipe out your obligation to pay any additional money if the property is sold by the creditor).

Source: Answers to Common Bankruptcy Questions Pamphlet
National Consumer Law Center, Boston, MA
www.nclc.org

Remember:  The law often changes.  Each case is different.  This pamphlet is meant to give you general information and not to give you specific legal advice.

Filed Under: Discharge, Filing Bankruptcy

Can I Own Anything After Bankruptcy?

Posted on January 9, 2009 Written by

Yes!  Many people believe they can not own anything for a period of time after filing for bankruptcy.  This is not true.  You can keep your exempt property and anything you obtain after the bankruptcy is filed.  However, if you receive an inheritance, a property settlement, or life insurance benefits within 180 days after filing for bankruptcy, that money or property may have to be paid to your creditors if the property or money is not exempt.

Source: Answers to Common Bankruptcy Questions Pamphlet
National Consumer Law Center, Boston, MA
www.nclc.org

Remember:  The law often changes.  Each case is different.  This pamphlet is meant to give you general information and not to give you specific legal advice.

Filed Under: Exemptions & What You Get to Keep, Filing Bankruptcy

What Will Happen to My Home and Car If I File Bankruptcy?

Posted on January 8, 2009 Written by

In most cases you will not lose your home or car during your bankruptcy case as long as your equity in the property is fully exempt.  Even if your property is not fully exempt, you will be able to keep it, if you pay its non-exempt value to creditors in chapter 13.

However, some of your creditors may have a “security interest” in your home, automobile, or other personal property.  This means that you gave that creditor a mortgage on the home or put your other property up as collateral for the debt.  Bankruptcy does not make these security interests go away.  If you don’t make your payments on that debt, the creditor may be able to take and sell the home or the property, during or after the bankruptcy case.

In a chapter 13 case, you may be able to keep certain secured property by paying the creditor the value of the property rather than the full amount owed on the debt.  Or you can use chapter 13 to catch up on back payments and get current on the loan. [Read more…]

Filed Under: Exemptions & What You Get to Keep, Filing Bankruptcy, Mortgages, Vehicles

What Must I Do Before Filing Bankruptcy? Alternatives to Consider

Posted on January 6, 2009 Written by

Some of the approved credit counseling agencies offer debt management plans (also called DMPs).  A DMP is a plan to repay some or all of your debts in which you send the counseling agency a monthly payment that it then distributes to your creditors.

Debt management plans can be helpful for some consumers.  For others, they are a terrible idea.  The problem is that many counseling agencies will pressure you into a debt management plan as a way of avoiding bankruptcy whether it makes sense for you or not.  You should not consider a debt management plan if making the monthly plan payment will mean you will not have money to pay your rent, mortgage, utilities, food, prescriptions, and other necessities.

It is important to keep in mind these important points: [Read more…]

Filed Under: Filing Bankruptcy

What Must I Do Before Filing Bankruptcy?

Posted on January 5, 2009 Written by

You must receive budget and credit counseling from an approved credit counseling agency within 180 days before your bankruptcy case is filed.  The agency will review possible options available to you in credit counseling and assist you in reviewing your budget.  Different agencies provide the counseling in-person, by telephone, or over the Internet.  If you decide to file bankruptcy, you must have a certificate from the agency showing that you received the counseling before your bankruptcy case was filed.

Most approved agencies charge between $30/-/$50 for the pre-filing counseling.

If you decide to go ahead with bankruptcy, you should [Read more…]

Filed Under: Filing Bankruptcy

BAP10 Accepts Electronic Filings

Posted on January 5, 2009 Written by

The Bankruptcy Appellate Panel for the Tenth Circuit will accept electronic filing of pleadings starting today.  The U.S. Court of Appeals for the Tenth Circuit is expected to follow suit soon.

To participate in electronic filing, attorneys must register for an Appellate ECF login and password with the PACER Service Center and wait for the Court to respond.  This is login is different from the one used in bankruptcy court electronic case filing.  You may sign up for all participating circuit courts and bankruptcy appellate panels with one login, however.

For more information, you may contact the PACER Service Center or call (800) 676-6856.

Filed Under: Filing Bankruptcy, Kansas Bankruptcy News

Jane Bryant Quinn: Go Bankrupt in 2009

Posted on January 4, 2009 Written by

“The right time to go bankrupt is when you’re financially, stuck but still have assets to protect,” Newsweek financial columnist Jane Bryant Quinn tells her readers.  “If you are reaching the end of your rope, don’t try to hold on.  Save what you can.”

Saying she normally would tell readers to “suck it up, cut spending and repay your consumer debt,” this year she is risking her “good-girl reputation with a subversive idea:  go bankrupt in 2009”.  It is not always possible to pay debt “especially with an economic tsunami rolling over your home, job and health insurance.” [Read more…]

Filed Under: Chapter 7, Exemptions & What You Get to Keep, Filing Bankruptcy

What Does It Cost to File for Bankruptcy?

Posted on January 4, 2009 Written by

It now costs $299 to file for bankruptcy under chapter 7 and $274 to file for bankruptcy under chapter 13, whether for one person or a married couple.  The court may allow you to pay this filing fee in installments if you can not pay it all at once.

If you hire an attorney you will also have to pay the attorney fees you agree to. [Read more…]

Filed Under: Chapter 13, Chapter 7, Filing Bankruptcy

Kansas Bankruptcies Climb 8% in 2008

Posted on January 4, 2009 Written by

Bankruptcy filings increased eight percent in Kansas during 2008, a smaller increase than the 33% national increase seen in most of the country.  A total of 8712 cases were filed here, about 69% as chapter 7 cases for individuals or married couples.  Nationally, 1,064,927 consumer bankruptcy cases were filed in 2008.

Topeka saw slightly more chapter 13 cases than chapter 7 cases in 2008.  Chapter 13 is a reorganization plan for individuals. [Read more…]

Filed Under: Chapter 13, Chapter 7, Filing Bankruptcy, Kansas Bankruptcy News

Chapter 13 (Reorganization)

Posted on January 3, 2009 Written by

In a chapter 13 case you file a “plan” showing how you will pay off some of your past-due and current debts over three to five years.  The most important thing about a chapter 13 case is that it will allow you to keep valuable property–especially your home and car–which might otherwise be lost, if you can make the payments which the bankruptcy law requires to be made to your creditors.

In most cases, these payments will be at least as much as your regular monthly payments on your mortgage or car loan, with some extra payment to get caught up on the amount you have fallen behind.

You should consider filing a chapter 13 plan if you: [Read more…]

Filed Under: Chapter 13, Exemptions & What You Get to Keep, Filing Bankruptcy

Chapter 7 (Straight Bankruptcy)

Posted on January 2, 2009 Written by

In a bankruptcy case under chapter 7, you file a petition asking the court to discharge your debts.  The basic idea in a chapter 7 bankruptcy is to wipe out (discharge) your debts in exchange for your giving up property, except for “exempt” property which the law allows you to keep.  In most cases, all of your property will be exempt.  But property which is not exempt is sold, with the money distributed to creditors.

If you want to keep property like a home or a car and are behind on the mortgage or car loan payments, a chapter 7 case probably will not be the right choice for you.  That is because chapter 7 bankruptcy does not eliminate the right of mortgage holders or car loan creditors to take your property to cover your debt.

If your income is above the median family income in your state, you may have to file a chapter 13 case [Read more…]

Filed Under: Chapter 7, Exemptions & What You Get to Keep, Filing Bankruptcy

What Different Types of Bankruptcy Cases Should I Consider?

Posted on January 1, 2009 Written by

There are four types of bankruptcy cases provided under the law:

  • Chapter 7 is known as “straight” bankruptcy or “liquidation.”  It requires an individual to give up property which is not “exempt” under the law, so the property can be sold to pay creditors.  Generally, those who file chapter 7 keep all of their property except property which is very valuable or which is subject to a lien which they can not avoid or afford to pay.
  • Chapter 11, known as “reorganization,” is used by businesses and a few individuals whose debts are very large.
  • Chapter 12 is reserved for family farmers and fishermen.
  • Chapter 13 is a type of “reorganization” used by individuals to pay all or a portion of their debts over a period of years using their current income. [Read more…]
Filed Under: Chapter 13, Chapter 7, Filing Bankruptcy

What Bankruptcy Can Not Do

Posted on December 31, 2008 Written by

Bankruptcy can not, however, cure every financial problem.  Nor is it the right step for every individual.  In bankruptcy, it is usually not possible to:

  • Eliminate certain rights of “secured” creditors.  A creditor is “secured” if it has taken a mortgage or other lien on property as collateral for a loan.  Common examples are car loans and home mortgages.  You can force secured creditors to take payments over time in the bankruptcy process and bankruptcy can eliminate your obligation to pay any additional money on the debt if you decide to give back the property.  But you generally can not keep secured property unless you continue to pay the debt.
  • Discharge types of debts singled out by the bankruptcy law for special treatment, such as child support, alimony, most student loans, court restitution orders, criminal fines, and most taxes. [Read more…]
Filed Under: Discharge, Filing Bankruptcy, Mortgages, Vehicles
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