Can creditors prevent me from filing bankruptcy?

No, creditors cannot "prevent" you from filing. Even if you signed a document promising not to file, it cannot be enforced against you. However, under certain circumstances, creditors may ask the Court to except (not discharge) certain debts. For instance, if you obtained money through fraud or embezzlement, the obligation to repay the funds would likely be found to be non-dischargeable. Also, if you were found to have caused damage as a result of operating a motor vehicle while under the influence, those damages would also likely be held to be not dischargeable.

Can I keep my house and car if I file bankruptcy?

In most instances, yes. If you are current on your payments, creditors would usually prefer to continue to receive payments rather than take the collateral back. If your vehicle or residence is worth more than you owe, you may be able to "exempt" (that is protect) the value above what you owe. If the value is greater than what the law permits you to protect, you may still be able to retain the home or vehicle by filing a Chapter 13 and paying the extra value over time.

Are there debts that I cannot discharge?

Yes. Domestic support obligations such as child support or spousal support are not dischargeable. Most student loans are not dischargeable. Some taxes, such as income taxes due within the past three years, are also not dischargeable. Certain debts, if creditors file an appropriate objection, may also be held to be non-dischargeable.

What if I cannot remember every creditor that I owe?

Do the best that you can. We want, ideally, to list every creditor so that your creditors receive notice from the Court so that they cease trying to collect from you. We want to search all places that we can to locate your possible creditors. However, even if you miss a creditor or two initially, it may be possible to still include and discharge those debts.

What impact does filing bankruptcy have on my credit?

The filing will appear on your credit for up to ten years. Bankruptcy is not an eraser so it will not wipe out the debts that you have when you file. As to future credit, the fact that you filed bankruptcy will be a factor which a potential future credit grantor will take into consideration when determining first, whether to extend credit and second, at what rate.

How are payments in Chapter 13 determined?

Many factors go into determining what you would ultimately have to pay in a chapter 13 repayment program. However, the starting point is your "disposable income", that is the difference between what you bring home each month and what you need so that you can pay your ongoing living expenses, those such as utilities, food, insurance, transportation,

shelter, clothing, prescriptions and ongoing medical services, etc. The difference between what you bring home and what you would need for ongoing expenses would be typically paid into the Chapter 13 Trustee who, after deducting allowed compensation to cover staff and overhead, would pay your creditors once a month, based upon the plan you propose and the claims your creditors file with the Court.

I need to file bankruptcy, but my spouse does not want to file. Can I file alone and, if so, what impact will my filing have on my spouse?

The fact that you may be married does not prevent one spouse from filing. If there are any obligations for which you and your spouse are both liable, your filing bankruptcy would not relieve your spouse from responsibility to that creditor. Your spouse's credit is separate from yours. Being married does not, by itself, obligate your spouse to your debts. If you and your spouse have no joint obligations, no notice of your bankruptcy should appear on your spouse's credit.

Can I file for bankruptcy if I don't have much debt?

There is no minimum amount of debt that you must have in order to file. That said, the Court and other parties will review your filing to determine if you have an ability to pay some of your debt. If you have minimal debt, but no real ability to make meaningful payments, you should be fine. However, if you are able to pay a meaningful repayment, you may not be able to file a Chapter 7, but could file a Chapter 13.

Can I have too much debt to file bankruptcy?

There are limits as to how much debt you can have and be able to file a Chapter 13. However, they are well into the millions of dollars and rarely affect consumer filers.

How do I know which bankruptcy chapter to file?

Your attorney can discuss the different chapters and help you to decide which you feel is best in your particular situation. Some considerations may include whether you have assets that might be at risk if you filed a Chapter 7, whether you need to save your home or vehicle, and whether you filed a previous bankruptcy.

How often can I file for bankruptcy?

You are not eligible to receive a discharge in a Chapter 7 if you filed, and received a discharge in, a Chapter 7 within the preceding 8 years. You may be able to file a Chapter 13, but you would only be eligible for a discharge in a Chapter 13 if you did not receive a discharge from a Chapter 7 case filed in the previous four years.

Can I file for bankruptcy on some of the accounts I owe, or do I have to include all of them?

You are required to list all debts that you have when you file, regardless of the chapter you choose to file. Failure to list all debts could result in your case being thrown out of court. You may, however, be able to pick and choose to keep particular debts if you file a Chapter 7. In a Chapter 13 you cannot treat similar creditors differently.

If I file for bankruptcy, will the cosigner of my loan still have to pay?

Maybe. If you agree to pay the debt out of your Chapter 7, or agree to pay the full amount of the debt plus the contract rate interest, the creditor may leave your cosigner alone as the creditor will be receiving all that the creditor is entitled to from you. However, your ability to discharge a debt does not affect the rights of the creditor to pursue your cosigner for the full balance of the debt. That's why creditors like to have cosigners - it gives them more people to go after to collect.

What are the differences between secured and unsecured debt?

Secured debt occurs when you give a creditor a right to property in exchange for the creditor loaning you money. Common examples of secured loans would be a home mortgage, a vehicle loan, or buying furniture or electronics on credit. An unsecured debt is one where only your promise to repay the loan is given to the creditor. Common examples of unsecured loans would be credit cards, medical debt, utilities, deficiency balances on repossessed vehicle or apartment evictions, taxes, and student loans. The creditor would have no property that they could try to collect against. But be careful - if you were sued by an unsecured creditor and the creditor obtained a judgment against you prior to you filing bankruptcy, that creditor may have had the Court place a judgment lien against your property, thereby possibly converting that unscured debt into a secured one.

Can I file for bankruptcy and stop a lawsuit or wipe out a money judgment against me?

Yes. Filing for bankruptcy invokes what is called the "Automatic Stay". This stops most civil actions against you (it does not stop criminal actions or actions to collect child support or alimony). The lawsuit would be halted so long as the bankruptcy is open. If you complete your discharge, the case will be gone, although the fact that one was filed against you will still remain on your credit report.

If the creditor has obtained a money judgment against you, they cannot collect against you so long as your bankruptcy case is open. But if the judgment has resulted in a judgment lien being filed against you, keep in mind that bankruptcy affect debt - it does not affect liens. If the lien has attached to property of yours, it may survive the bankruptcy discharge and give the creditor a chance to collect against the property after your bankruptcy is complete. Speak with your attorney about your options if this is the situation with you.

What property can I keep, if anything, if I file for bankruptcy?

Very rarely do debtors lose property when they file a Chapter 7 (and never unless they choose to in a Chapter 13, provided they remain current on their payments). When you file, you are permitted to protect through exemptions different types of property up to certain dollar values. Provided your assets are worth less (and this is the situation about 95% of the time), you would not lose anything.

What types of property might be most at risk?

Tax refunds, equity in vehicles, cash value in life insurance, claims against third parties such as for an accident or medical claim are among the most common.

Can I keep my retirement account or Social Security payment if I file for bankruptcy?

Yes. Retirement accounts are specifically by law excluded from your bankruptcy assets. They would still need to be disclosed. But if the account is an IRA, 401k, or pensions, your retirement account is safe, provided you have not suddenly dumped a large sum from a non-exempt source into your IRA.

Can I file for bankruptcy and keep my inheritance?

It depends. If the party leaving you the inheritance has died prior to the filing of the bankruptcy, then maybe not, unless the bequest is minimal. This is also true for anyone who dies within 180 days AFTER you file for bankruptcy. If the inheritance is from someone who died more than 180 days after you filed, you may keep your inheritance.

However, if you are in a Chapter 13 and someone dies while your case is open, even beyond 180 days, you may lose some or all of that inheritance.

How long a bankruptcy case last? And how long does it stay on my credit?

A Chapter 7 case typically runs about four months in most instances. The fact that you filed will remain on your credit for ten years. A Chapter 13 case, unless you are able to pay all of your creditors sooner, lasts a minimum of three years and a maximum of five years. Depending upon your circumstances, you may be forced into a five year plan. The fact that you filed a Chapter 13 case will go on your credit report for seven years from date of filing, not the date your case concluded.

Will I have to go to Court? And will my creditors be there?

You are required to appear for what is called the Meeting of Creditors under section 341. At present, and for the foreseeable future, it is being conducted by telephone, rather than in person. Although your creditors will receive notice of the Meeting, creditors rarely appear. It is typically just a questioning by the bankruptcy trustee appointed to oversee your case. He or she will ask you questions regarding your filing and your financial situation to determine of you meet all the requirements as well as to try to determine whether you do have any non-exempt assets which can be liquidated to provide a distribution to your creditors. The proceeding only takes a few minutes and is generally

non-confrontational. You are under oath, however, and do need to answer the questions truthfully.