Chapter 2:

What is a Chapter 7 Bankruptcy?
Chapter 7 bankruptcy, is also referred to as straight bankruptcy. It is a liquidation proceeding. All dischargeable debts are eliminated. No money is paid to the court or on the unsecured debts. The debtor receives a ‘fresh start’. The entire process takes less than four months. The debtor is allowed to keep virtually all of their property, assuming it fits into the exemption schedule. I will examine the exemption schedule with you at your first appointment.

What are the most common reasons people file for Chapter 7?
1) Large medical bills;
2) Unemployment or disability;
3) Seriously overextended credit;
4) Marital problems;
5) Other large unexpected expenses.

I filed for bankruptcy before, can I file again?
Yes, you can file a Chapter 7 eight (8) years after your last chapter 7 filing. It used to be six years before the law changed. The time periods differ if your last filing was a chapter 13.

If I use a credit counselor won’t I get a better credit rating than if I file Bankruptcy?
No. A Bankruptcy will cost you less money and you will be able to re-build your credit much faster. Many so called debt counselors are nothing more than a rip off. They are unscrupulous companies in the business of stealing. There are some good ones, but even they have little to offer.

What debts are not erased by a bankruptcy?
1) Debts for personal injury or death caused by your drunk driving;
2) Student loans unless the court finds that the debt would impose an undue hardship on the debtor and his or her dependents; (this is very difficult to prove)
3) Most tax debts;
4) Child support and alimony;
5) Debts pursuant to a divorce judgment and your spouse objects;
6) Debts for obtaining money by fraud, false pretenses, or theft.
7) Debts for some fines and penalties in criminal cases;
8) And a few other very narrow exceptions.

Can I keep my tax refunds?
Generally, yes. The refund will need to be exempted. And assuming you have enough of
an exemption to cover it, you can keep it.

If I am surrendering my home, how long can I stay in it?
You can stay in the home at least 6 months after the foreclosure process has begun.

What happens when the case is filed?
Immediately upon filing, an automatic stay is invoked by the court. This court order prohibits the creditors from calling, writing, or contacting you in any way, or collecting any money by any means. They are literally, ‘dead in the water’.

What if I have been sued, and I have judgments against me, can I still discharge the debt?
Yes, no problem. The fact that they have got a judgment or sued you, will not stop the bankruptcy from discharging the debt.

After the case is filed and completed, I want to pay some of the debts that were discharged, can I?
Yes, after the case is closed, you are free to do as you wish. Technically, paying a debt that was discharged would be a gift to the creditor. You are free to give gifs to anyone you wish.
If I pay one creditor, can the others then come after me then. No.

Will creditors appear at my meeting with the trustee (also called the 341 meeting)?
Probably not. They are allowed to appear and question you. However, in the last one hundred petitions we filed, only one creditor appeared at one meeting.