|
Common Bankruptcy Questions
|
|
Can bankruptcy stop garnishments, law suits and creditors from calling?
|
|
Yes. Once
you file for bankruptcy an "automatic stay" will prevent creditors from continuing their collection attempts.
|
Will bankruptcy eliminate all of my debt?
|
|
Not necessarily.
Certain debts like student s loans, taxes, certain credit card debt and other debts generally cannot be discharged.
|
Will I lose all of my assets? |
|
There are a number
of assets that are "exempt" from the bankruptcy process and free from creditors who do not have a lien against the exempt asset. To
learn more about what assets you may be able to keep, click
here.
|
What is a "Fraudulent Transfer"? |
|
A transfer of a debtor’s property made with intent to defraud or for
which the debtor receives less than the transferred property’s value.
|
What is a "No-Asset"
Bankruptcy? |
|
A chapter 7 case where there are no assets available to satisfy any portion of the creditors’
unsecured claims.
|
Can I keep my home if I continue to pay my mortgage/s? |
|
If you have a mortgage on your home but would still like to keep the home, you will need to "reaffirm" the mortgage debt. to learn more about "reaffirmation" of debts, click here.
|
Can I pay back my parents (brother, sister, son, daughter, buddy, etc.) the money they loaned me
a while back, without affecting my bankruptcy? |
|
No. After you file, or within the 90 days before you file, (with some exceptions
that may not apply) or within one year before you file in the case of payments to "insiders" you don’t get
to pick and choose who gets paid. Theses are
called "Preferences". Violations may be voided, or worse, they
may be deemed fraudulent. You can voluntarily pay them back after your discharge if you want.
|
Will a bankruptcy adversely
impact my credit rating? |
|
A bankruptcy will show up on your credit report; however, most people
entering into bankruptcy have already taken significant hits to their credit score so the impact may be limited. Many
find that bankruptcy is actually the first step to restoring their credit score since they have shed the debt that caused
their credit to fall in the first place.
|
Can you reaffirm credit card debt in order to keep the credit card?
|
|
A bankruptcy doesn’t force
termination of credit accounts. It only discharges the debts. Whether the creditor will agree to keep an account
open (regardless whether it carried a discharged debt or not) is at the creditor’s discretion. If there are balances
due on the cards, it is very unlikely that the trustee would approve reaffirmation of two unsecured debts and discharge the
rest. On the other hand, credit card lenders are cold. They may determine that if they took no loss, and since
you wouldn’t be able to file again for 8 years, you are worth keeping as a customer.
|
When I file bankruptcy do I have to list all of my assets and liabilities? |
|
Yes.
Bankruptcy does not allow the debtor to favor one creditor over another and only allows the debtor to keep certain assets.
|
What if you forget to list a liability?
|
|
Your
bankruptcy lawyer will have to amend your case to include the omitted liability.
|
Can all debts be discharged through bankruptcy?
|
|
No.
Certain debts like student loans, taxes, government loans and certain credit card debt cannot be discharged.
|
If I file Bankruptcy will I lose my social security benefits?
|
|
 |
|
|
|
Bankruptcy King and The Drive-In Bankruptcy
|
You’ve heard attorneys advertise on TV that filing bankruptcies is “all they do and they
do it well.” The psychology seems to be that if they do nothing else, and do enormous quantities of them, they
must be very good at it – and they must be very inexpensive. But upon reflection this is similar to a fast-food sales pitch. No
one sells more prepared hamburgers than McDonalds.
The burgers are ready in minutes, and they cost a fraction
of what full-menu restaurants charge. They all taste the same, they all look the same. They are cooked according
to strict standards, so the cooks need know little about the ingredients, and even less about their customer. If
the customer wants or needs something other than that particular hamburger, they can and should go elsewhere. McDonalds
doesn’t sell its hamburgers with the hope that you’ll come back tomorrow and purchase a 4-course dinner –
they don’t sell 4-course dinners. They sell that hamburger with the hope that next time you want a hamburger
you’ll come back and buy another of theirs. The metaphor is transparent.
The bankruptcy-mill law firms provide fast, (relatively)
inexpensive services resulting ultimately in a product identical for all their customers. Their process is regimented
to strict standards, so the “cooks” need to (and seem to want to) know as little about their customer as possible,
for fear of spoiling the assembly-line necessary to produce that many bankruptcies. If you want or need
something different, that’s your problem.
Finally, because “its all they do”, the
bankruptcy mill isn’t trying to win your continued business – they don’t sell any other product or service. What
they want is your referral, and for you to come back when you need your next bankruptcy. In previous years we found that high-quality bankruptcy legal services were priced beyond the reach of most of our
clients. Those down-town attorneys with sophisticated bankruptcy practices focused on large-scale, complex
business bankruptcies. Those who focused on consumer bankruptcy were simply unresponsive or lacked experience in, and appreciation
of the real estate and business industry. Or more disturbingly, they simply were non-responsive or expressed little
concern for our clients.
In this dismal economy the choices were
unacceptable. So Nash & Lodge has now expanded its previous creditor-focused bankruptcy practice to include
debtor representation. We will handle your bankruptcy for the same price the bankruptcy-mill firms do and we’ll do
it well, but we don’t want your next bankruptcy – we don’t want you to have a next bankruptcy. That’s
not all we do.
|
|
|
I Can't Pay All My Bills, Who Should You Pay First?
|
When
money is tight the first dilemma people face is who should I pay first. In many instances, people pay the most aggressive
creditor to stop the phone calls and harassment. This is not a good way to deal with you situation. You need to
create a budget plan that prioritizes debt. Certain debt is essential: housing, food and transportation. You need
a place to sleep, you need food to eat and you need transportation to get to work. You generally do not want to pay
unsecured debt before paying secured debt. While the credit card company may be the most aggressive creditor, they cannot force you to
pay or take any of your assets without first suing you and getting a judgement. On the other hand, the secured creditor can seize the collateral that was put up as security
for the debt provided they follow the terms of the collateral agreement and the controlling law. The Bankruptcy
Trustee and other creditors can also challenge certain payments to creditors if the payments violate the bankruptcy preference rules. These rules allow certain payments made within 90 days and up to one year before
the bankruptcy filing to be recovered to the bankruptcy estate. For more information on bankruptcy preference rules, click here. `
Be careful about paying money out of funds that are protected from bankruptcy and/or judgments to pay off debts.
If you use protected money but then still have to go through bankruptcy you essentially threw that money away. In
some cases, taking the money out of certain retirement funds will trigger a tax consequence.
|
The costs of bankruptcies have risen as a result of the changes enacted by
Congress in 2005 to address precieved abuses of the system. While todays bankruptcies are more complicated and more
expensive, Nash & Lodge also recognizes that most individuals income has decreased. To help address the needs of
our clients we have instituted a flat fee schedule for the different types of bankruptcies that individuals and businesses
are facing. While everyones situation will fit into our cheapest packages, most will. Even if your situation does
not fit into an existing flat fee schedule we can often offer you a flat fee once we have analysised your specific situation.
Our discounted bankruptcy consultation fee is $150.00 which will be charged for an initial consultation, which will credit against our Bankruptcy Retainer if you
decide to proceed with a bankruptcy. We will review your financial situation to help you determine whether you need
a bankruptcy, whether other options are available for you or determine when and what bankruptcy is right for your situation
if we determine that one is necessary.
|
|
|
|
