Common Bankruptcy Questions
Bergen County Bankruptcy Attorney
What You Need to Know About Filing for Bankruptcy
The complex bankruptcy process presents a situation that requires an attentive attorney to assist you in navigating through it successfully. Individuals filing bankruptcy are often anxious for what the future holds. They are also attempting to take a hard look at their state of affairs and calculate their options with an even mind.
At The Law Offices of Susan S. Long, we will make sure that you are able to make informed decisions regarding your financial future during this difficult time.
Frequently Asked Bankruptcy Questions
What is bankruptcy?
Federal law provides that an individual who cannot pay his or her debt may be eligible for a fresh financial start. By filing for bankruptcy, an individual’s debt may be eliminated and/or made manageable through a court appointed payment plan.
I am afraid of losing my job if I file for bankruptcy. Who will know I am filing?
Although bankruptcies are public records, other than your creditors and those you choose to disclose the information to, no one needs to know you went bankrupt. Federal law prohibits any employer from discriminating against you for filing for bankruptcy.
Will filing bankruptcy keep my creditors from harassing me or filing a lawsuit?
Yes, you will be protected from any creditor actions from the moment your petition is filed with the court. Creditors cannot call you, initiate or continue any lawsuits, or garnish your wages. Bankruptcy may also help you stop foreclosure on your home and allow you an opportunity to catch up on missed payments. Know your rights against collections harassment.
What is a Chapter 7 bankruptcy?
A Chapter 7 bankruptcy is a liquidation proceeding in which a debtor’s assets are reduced to cash and distributed to creditors. However, the law provides for exemptions which will protect most, if not all, of a debtor’s assets from liquidation. Absent complications, debtors will usually receive a discharge within a few months of filing.
What is a Chapter 13 bankruptcy?
A Chapter 13 bankruptcy is a reorganization bankruptcy in which an individual pays off debt over a period of three to five years. When the court-approved repayment plan is completed, the debtor receives a discharge.
I have heard the bankruptcy laws have changed. What are the new requirements for filing a Chapter 7 bankruptcy?
There are new eligibility requirements in regards to a debtor’s eligibility to file bankruptcy, as well as a requirement that debtors complete two courses. Your attorney will have to determine whether your income and allowable expenses will result in a Chapter 7 or Chapter 13 bankruptcy. However, the majority of debtors will still be eligible to file a Chapter 7. The new laws also require you to complete a credit counseling course prior to filing your case, as well as a financial management course prior to the discharge of your case.
What debts are dischargeable?
Most debts are dischargeable, including credit card debt, medical bills, and certain loans. However, there are several non-dischargeable debts, including student loans, child support, alimony, certain taxes, fraudulent debts and debts not listed on the bankruptcy petition. It also must be noted that bankruptcy will not eliminate the rights of secured creditors, such as lenders of car loans and home mortgages, without the payoff of these debts.
Can I keep my home, car and other personal property?
Federal and state law provide for exemptions on certain personal properties up to a specified amount. Should your property values exceed the exemptions, there are different options to consider in order to keep your property. Each individual’s case will be unique and it is best to discuss questions concerning your personal property with a bankruptcy attorney.
Will my spouse be affected if I file for bankruptcy?
Unless your spouse signed an agreement or contract for any of your debt, he or she will not be affected. If your spouse guaranteed the repayment of or co-signed on a debt, the creditor will look to that spouse for payment when you file for bankruptcy. Even if the spouse is not jointly liable for the debt, it may be to your benefit to file jointly because it will double the exemptions allowed on personal property.
Do I need an attorney? It has been recommended that I use a Bankruptcy Petition Preparer to help me file for bankruptcy.
You are not required to be represented by an attorney when filing for bankruptcy. In fact, there are many areas of the law that do not require an individual to be represented by an attorney. However, bankruptcy is a complex area of the law and there are several legal issues presented in each case. Bankruptcy Petition Preparers are not attorneys and are prohibited from providing any legal advice regarding your bankruptcy. This means they cannot advise you as to which chapter of bankruptcy to file, its potential outcome or whether to file for bankruptcy at all. They also cannot advise you as to which property is exempt, as to which debts or assets to list on your petition, and cannot represent you in court.
How long does a bankruptcy remain on my credit report?
A bankruptcy appears on your credit report for ten years, but the effect can be tempered starting the day after your case is closed.
Will I be able to purchase a car, a house, or anything on credit, in the future?
Yes, you will. When you may be able to depends on your personal situation and prior credit history. However, it is in your best interest to decline or limit credit so that you do not again experience the financial difficulties that required you to file bankruptcy.
For more information, please visit the section explaining the bankruptcy process.
Contact The Law Offices of Susan S. Long
Contact our Bergen County bankruptcy lawyer online or call 201-749-5418 to schedule a free, initial phone consultation. We serve residents in Bergen, Hudson and Passaic counties.