Q:

Will It Ruin My Credit?

A:

Bankruptcy, in most circumstances, will have a negative impact on your credit score to be sure. However, so do collections and past due bills. The difference is, after a discharge in bankruptcy, you will generally see your scores start to improve over time. In fact, many lenders are very interested in lending to people who have just been discharged because they feel that you will have the funds to pay them back.

Q:

Will They Take My Home?

A:

Almost assuredly no. The bankruptcy code allows substantial exemptions for equity in homes, meaning that under most circumstances creditors cannot seek to have the home sold to repay them.

Q:

Will They Take My Car?

A:

Most of the time no. However, the answer turns on how whether you are leasing or buying your car and how much equity you have in it. Like for homes, the bankruptcy code allows for an exemption of a certain amount of equity in your car before the trustee could seek to have it sold.

Q:

Will I Still Be Responsible for My Business Debts?

A:

There is no bright line answer to this question; rather it is fact and situation specific. This is something we would carefully review to determine how the debts of your business will affect you personally.

Q:

My Neighbor Filed His Own Bankruptcy Papers, I Can Do It Myself, Right?

A:

You just fill in the blanks on some forms, right? NOT SO FAST. The bankruptcy code is complex and ever-changing, and it takes significant and ongoing study to stay abreast of the many changes. Just because you can file your own bankruptcy, doesn’t mean you should. Exemptions are one example of where if you don’t understand the law you might miss exemptions that allow you to keep most or all of your property. Or worse yet, you unintentionally fail to report certain transactions or assets in your filings and you find yourself trying to explain yourself to the Court (not a situation you want to be in!).

Q:

​Should I Take out A Home Equity Loan to “consolidate My Credit Debt?”

A:

There is no one-size fits all answer to this question, but experience has shown that some people who take out a home equity loan to pay off their credit cards, end up maxing out their credit cards again, and find themselves without any equity in their home and once again facing bankruptcy as their only option. Perhaps they would be better off negotiating their credit card debts with the lenders, or perhaps, they should file bankruptcy, get a fresh start and preserve the equity in their home. However, from my experience, I would say that there are very, very few circumstances when taking equity from your home and giving it to unsecured creditors is a good idea.

Q:

Can Creditors Keep Calling Once I Have Filed for Bankruptcy?

A:

Immediately upon filing, an "automatic stay" is issued on your case, which prevents additional collection attempts by your creditors. However, it may take a little time for all of your creditors to be notified of your filing, so you could get a few calls. In that case, I tell my clients to let the creditor know that they are represented by an attorney in a bankruptcy proceeding and give them my name and number, and I will handle the rest.

Q:

Do I Have to Go to Court?

A:

In most cases, the answer is no. You will have to appear for a meeting with a Trustee(called the meeting of creditors) however. This meeting is usually about 5 to 10 minutes and I am there by your side the entire time. 

Q:

I Am Married. Does My Spouse Have to File for Bankruptcy Too?

A:

No. Just because you file for bankruptcy protection does not mean your spouse has to file. However, each situation is unique, and much of the decision on whether to file jointly or not is based upon whose names the debts are in. Depending on which debts are considered joint debts, it may or may not make sense to file together.

Q:

What Happens To My Utilities in A Bankruptcy?

A:

Immediately upon filing your utility company is prohibited from disconnecting or suspending your service. However, this prohibition only lasts for 20 days. In that 20 day time period you have to provide the utility company "adequate assurance" of payment, otherwise the utility can proceed with disconnection.