Frequently Asked Bankruptcy Questions
Below you will find answers to some of the most common questions people have
when filing for bankruptcy in Ohio. Having a clear understanding of how bankruptcy
works and how filing for bankruptcy will affect your life, will allow you
to make the decision that is best for you.
How will filing for bankruptcy affect my credit?
There is no clear answer to this question. Unfortunately, if you have been
sued in foreclosure or you are behind on your bills, your credit is already
downgraded. Bankruptcy will probably not make things any worse, and can bring
an end to your financial stress and provide you with a fresh financial start.
The fact that you filed a bankruptcy can remain on your credit record for
ten (10) years. However, it is important to understand that bankruptcy wipes
out most old debts; as a result, you are likely to be in a better position
to pay your current bills, and you may be able to get new credit.
Can calls and threats from creditors be stopped.
Upon the filing of the bankruptcy, all creditor calls must stop. If you are experiencing problems with creditors calling you day and night, you should consider filing bankruptcy as a means of legally stopping all telephone calls. Your creditors will be violating the law if they call you after the filing, and as part of my representation of you, I will write "cease and desist" letters to any creditor who does so. In my experience, these letters have been 100% effective in stopping any creditors contacting you after the filing of your petition.
What are the costs involved with filing for bankruptcy?
First there are court costs. The
court costs are $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. If you hire an attorney
you will also have
to pay the attorney’s fees. Your attorney may not pay
your filing fee for you. In the case of Chapter 13 bankruptcies,
the
attorneys’ fees
are set uniformly by court order. In the case of Chapter 7
bankruptcies, I will meet with you and structure attorneys’ fees
and a payment plan which is fair for you.
What will happen to
my home and car if I file bankruptcy?
In most cases, you will
not lose your home or car during your bankruptcy case as long as you keep
you monthly payments current.
If you have
equity in the
property it may be fully exempt. If the sale of
the property will not result in a meaningful distribution to creditors, your
home and
car will
not be sold.
Even
if your property is not fully exempt, you may be able to
keep it if you pay its fair value to creditors in Chapter 13. Your
attorney
should
be
able to
fully advise you regarding any property loss before you file
Chapter 7.
Can I Own Anything after filing for Bankruptcy?
Yes! Many people believe they cannot own
anything for a period of time after filing for bankruptcy. This is simply
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.
Will
filing for bankruptcy wipe out all of my debts?
Yes, but with some exceptions. Bankruptcy
will normally not relieve you of the following:
-
money owed for child support
or alimony, fines, and some taxes;
-
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;
-
most student loans ( unless “undue
hardship” provides
an exception )
-
mortgages or other liens which are not paid
in the bankruptcy case, excepting any
deficiency judgment.
Will
I have to appear in Bankruptcy Court?
In most bankruptcy cases, you only have to go to
a proceeding called the “first
meeting of creditors” to meet with the bankruptcy
trustee assigned to your case. Although any creditor
who chooses to come can attend, it is extremely
rare that they do so. Most of the time, the meeting
will be a short and simple procedure where you are
asked a few questions about your identify, your employment,
your bankruptcy forms and your financial situation.
Will i have to appear in Bankruptcy Court?
Last sentence "your attorney will charge you an additional fee should you have to attend this type of hearing."
Occasionally,
if complications arise, or if you choose to dispute
a debt, you may have to appear before
a judge at
a hearing.
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. Your attorney will charge you an additional fee should you have to attend this type of hearing.
What are the different forms of bankruptcy cases I should consider?
There are four types of bankruptcy cases provided under the law:
Chapter 7 is known as “straight” bankruptcy or “liquidation.” In
some cases, it requires a debtor to give up property which exceeds certain
limits (called “exemptions”) so the property can be sold to pay
creditors. However, from a practical standpoint, this is by far the most common
type of bankruptcy. Your attorney will advise you whether you should file Chapter
13, instead of Chapter 7, in the event you run the risk of losing any of your
valued property in Chapter 7.
Chapter 11, known as “reorganization”, is used by businesses and
a few individual debtors whose debts are very large.
Chapter 12 is reserved for family farmers.
Chapter 13 is called “debt adjustment.” It requires a debtor to
file a plan to pay debts (or portions of their debts) from current income but
allows to keep property, even if the property is in foreclosure.
Most people filing bankruptcy will want to file under either Chapter
7 or Chapter 13. Either type of case may be filed individually or by a married couple
filing jointly. Married couples may also file individually without any consequence
to their non-filing spouse, if the spouse is not a co-signer or co- maker.
What if I Don’t Have
Complete Financial Records?
It is essential
to list every creditor by name and mailing address in your petition. If you
do not have
complete
financial records
for your
debts,
you can obtain a copy of your credit report
by contacting one of the three major
credit bureaus. They will charge you around
$8.50 per report; the report is free if you
have been
denied credit in the
previous 60
days or if
you have
been the victim of credit fraud.
To order
a credit report by mail, provide your full name, including middle initial
and Jr.,
Sr., or any
other designation
you have
used; current
address and previous addresses for the
last five years; Social Security number;
date of birth; spouses’ first name;
home phone number, name of current employer
and signature. Here is the contact information
for each of the three major credit bureaus:
P.O. Box 105496, Atlanta, GA
30348-5496. By phone: 1-800-997-2493,
or 1-800-685-1111.
Online:
www.equifax.com.
Transunion,
Consumer Disclosure Center, P.O. Box 1000, Chester, PA 19022.
By phone: 1-800-888-4213.
Online: www.transunion.com.
Experian, P.O Box 2002, Allen, TX 75013. By phone: 1-888-397-3742. Online: www.experian.com.
If you have a credit
report you have obtained and you want me to use it
in your case,
make sure that
all
of your creditor
addresses
are
listed. If the
credit report you bring to me does
not have the creditors addresses
listed, I can’t use it to prepare your
petition.
|
