File Bankruptcy FAQ
File Bankruptcy FAQ
Q: What Does it Mean to File Bankruptcy Under Chapter 7?
A: Chapter 7 is a way to file bankruptcy in which all of an individual’s debts are discharged and his property is liquidated. With this type of bankruptcy, a person is declared unable to pay back his debts and is released from the responsibility. His non-exempt property is then liquidated in an effort to pay back some of his existing debts.
Q: What Does it Mean to File Bankruptcy Under Chapter13?
A: Chapter 13 is a way to file bankruptcy in which a payment plan is established to take care of any debts an individual owes. This payment plan generally last for three to five years and is set up by the court. Individuals who wish to keep non-exempt property are best suited for this type of bankruptcy.
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Q: Is a Lawyer Necessary if I File Bankruptcy?
A: If you are going to file bankruptcy, most court officials recommend you use a lawyer to help you navigate the legal documents involved with a bankruptcy case. This will help you avoid problems that could lead to a dismissal of your bankruptcy. If you wish to go pro se, though, you may do so.
Q: After I File Bankruptcy, will I still Have to Deal with Creditors?
A: By law, after you file bankruptcy your creditors must cease from their collection actions. They will not be able to contact you throughout the entire bankruptcy proceedings. If you have secured debt, like a home loan, and haven’t made payments, a creditor may request a lift of the stay from the court. If the judge approves of the lift, you will be required to pay on that debt or it may be seized by the creditor.
Q: If I File Bankruptcy, how will it affect my Spouse?
A: In most states, your spouse will not be affected by your bankruptcy at all, as long as he or she has not taken part in creating the debt. If your spouse signed an agreement with the creditor and shares the debt, he or she will owe the debt as well. Community property states are different however, and consider some debt to be shared by a couple, no matter who has signed for it. If your spouse owes on the debt you filing bankruptcy for, you may want to consider a joint bankruptcy to avoid having to deal with creditors after the bankruptcy is discharged.
Q: Can I Keep my Bankruptcy a Secret?
A: Because they are available to the public, bankruptcy records are hard to keep secret from those who wish to know whether you had to file bankruptcy. Future and current employers may wish to gain access to these files. By law, though, no employer can fire you or refuse to hire you because of a bankruptcy filing.
Q: When can I Expect my Credit Report to Look Good Again?
A: After you file bankruptcy, you can expect for your credit report to say bankruptcy for ten years. You will not be barred from attaining credit for the next decade though. You may be able to obtain credit just a couple of years after you file bankruptcy.
Q: If I File Bankruptcy, do I have to go Before a Judge?
A: Not necessarily. Generally, you will only have to step foot in court once during your bankruptcy, at the 341 hearing. In this hearing, you will be questioned, under oath, by your creditors to help determine whether you are able to pay back the debt you owe. It is important you answer each question you are asked truthfully and completely.
Q: What is the Cost of Filing Bankruptcy?
A: The majority of the time, filing bankruptcy costs about $300. If you choose to go online and file bankruptcy, though, it may cost much less. Lawyers can be expensive, costing one to two thousand dollars, but can be very helpful during bankruptcy cases.
