• Questions You May Have About Bankruptcy

  • What is bankruptcy and what does it do?
    It is a legal process established to allow people to get out from under the crush of unpaid bills. Through bankruptcy we can cancel most most or all of your credit card and personal loan debt and stop wage garnishments, creditor harassment, foreclosure of your home and repossession of property.

    Do I have to go to court?
    You have to go to a meeting with the examiner (trustee) appointed to your case. The meeting is generally short; you will be asked questions about your case (please see section titled "The Bankruptcy Process"). Don't worry, I will review everything with you before the meeting.

    Do I have to have lot of debt to file?
    NO. Usually one creditor is either demanding payment or threatening legal action. Often the problem is that you can't pay this creditor and pay for other needed services.

    If I'm married must my spouse file?
    Usually both a husband and wife will file if they are both responsible for many of their bills. However, often only one spouse files. It depends on a variety of factors.

    What happens to my mortgage or car loan?
    You can keep your house and car and you make the monthly payments on time. If you are behind in these payments we formulate a plan to satisfy these missed payments.

    Will my bankruptcy be on my credit report?
    Yes it will, but this will be a good thing. It will tell creditors that all pre-existing debt has been discharged. It will also tell creditors that you are doing something about your credit situation, instead of taking no action or making it get worse. In today's credit world, this is a good thing. Please see the section on Credit.

    Can I obtain credit after I file bankruptcy?
    If you handle yourself in a responsible financial manner after filing bankruptcy and you have a means of income, you should have no problem in obtaining needed credit.

    Will I lose my property if I file bankruptcy?
    NO. If a situation is properly analyzed, it is rare for anyone to lose any property.

    Are secured debts, like mortgages and auto loans, dischargeable?
    It is possible to discharge second or third mortgages and change the terms of auto loans in a bankruptcy case. It will depend on the circumstances of each case. Of course, if you do not want to keep a home or automobile, we would be able to erase your liability on that obligation.

  • Stopping Bill Collectors
    If you have fallen behind on bills and debts, there is a good chance that you are receiving telephone calls from bill collectors. Many of these collectors often go beyond the scope of what the law allows them to say, to the point of being abusive and making false threats.
    However, once you retain a lawyer to represent you in a bankruptcy proceeding, and once these bill collectors are told the name and telephone number of your lawyer, they CANNOT contact you any longer. That is the law.

    If you have retained me to represent you, let these bill collectors know this. Tell them my name and phone number and wish them a good day. End of conversation! Any more time spent on the telephone with them will only hurt you and raise your blood pressure, to boot. If one or more of them should persist in calling you, and this is generally not the case, ask them for their name and telephone number and then contact my office.

    Money On Deposit With A Creditor
    If you have money on deposit with a bank or credit union and you have an outstanding loan or credit card balance with that bank or credit union, before you file bankruptcy you should withdraw the money on deposit and stop any direct deposit into the account, because after you file they will be allowed to take any money on deposit and apply it to the amount owed to them.

    Utility Arrears
    If you are owing a large amount on a current utility bill (gas, electric, telephone), we can list this debt in your bankruptcy petition and this bill will be eliminated and service WILL continue. However, if you want the utility service to continue in your name, the utility company will require that you post a security deposit within no more than 40 days of filing your petition. The amount of the security deposit is determined by adding together the two largest months of usage over the past twelve months.

    If you are not owing a large amount but want to continue this service in your name, it may be better to not list the utility debt in your bankruptcy, and instead pay-off the bill in installments. The utility company must give you time to pay the overdue amount. This installment option must be offered at least five days before any shut-off and the payment plan must be fair.

    Co-Signed Loans
    You may have obtained a loan where another person co-signed and obligated themselves on this account with you. If you have such a loan and we put it on your bankruptcy petition, it will be discharged, but this other person will remain obligated on this loan and may be pursued by the loan company. Let me know if you have such a loan and it is a problem in your case.