I am a cosigner for a debt, how does bankruptcy affect my obligation?
If the debt is a dischargeable debt then you will not have to pay it. However, the cosigner will become primarily responsible for the debt. Be sure to list the co-signer as a creditor in your schedules as they have a contingent claim against you.

Can I keep my house after bankruptcy?
Depending upon which exemption scheme is selected and your circumstances, you may exempt up to $100,000 in equity. When calculating your equity you should use a value that is based upon a forced liquidation as opposed to the best selling conditions to arrive at a value for your home. Once you know the value, subtract the amount owed plus selling and transfer costs from the value to calculate the equity. In a depressed market, liquidated properties are often valued less than what we like to think the property is worth.

Can I keep my credit cards after bankruptcy?
Under some circumstances you may keep your credit cards. There are many factors which must be considered. Some of those include the credit card balance at the time of the bankruptcy, what the credit card company is willing to do and your ability to pay the present and future credit card debt.

Will I lose my job?
No. Bankruptcy laws prohibits discrimination based upon a debtor filing for protection under the bankruptcy laws.

Can I go to jail if I file bankruptcy?
No. There are no debtor’s prisons in the United States.

Will my employer find out about my bankruptcy?
Under normal circumstances, unless your employer is a creditor, your employer will not know.

Will bankruptcy stop a wage attachment?
Yes.

Will bankruptcy stop a judgment?
Yes. Many civil judgments are stopped by bankruptcy.

Will a bankruptcy remove a lien?
Under some circumstances once the bankruptcy proceedings have started, special motion can be filed to remove certain liens. It will take a bankruptcy court order to remove them. This is a complicated area of the bankruptcy law and an attorney should be consulted.

Will bankruptcy stop an eviction action?
Perhaps. However, this will only delay the inevitable. The owner is entitled to possession of his property and at best you will be able to remain in the property until you have received your discharge from bankruptcy or the landlord obtains an order from the bankruptcy court. I must caution you that if the only reason you filed the bankruptcy is to stop an eviction then this might be considered an abuse of Chapter 7. If the bankruptcy court finds that this is true then the court can immediately dismiss the bankruptcy and impose other legal and monetary sanctions on you.

Will bankruptcy stop a foreclosure?
Yes. However, a home is an asset usually secured by a deed of trust. The mortgage company is entitled to apply to the court for relief from the automatic stay, the order preventing creditor action by virtue of the bankruptcy. Depending upon several factors, you may be able to prolong a foreclosure until you have received your discharge from bankruptcy. Usually, to keep a home that is in foreclosure you will have to make a deal with the note holder.

I am divorced, will bankruptcy wipe out my obligation to pay community debts?
In general, you will be discharged from all dischargeable community debts. However, you should discuss this with your family law attorney to understand the other implications of the filing of a bankruptcy during the pendency of a dissolution action (divorce case). Also, remember that if you are discharged from community debts, your spouse is responsible for the entire balance owing on the debt. Put another way, they shift the responsibility on to you.

Are there any debts that I can’t wipe out in bankruptcy?
Yes, there are certain debts that are NOT dischargeable in bankruptcy. Generally speaking, the following debts will not be discharged: Taxes; Spousal and Child Support; Debts arising out of willful misconduct and or malicious misconduct by the debtor; liability for injury or death from driving while intoxicated; non-dischargeable debts from a prior bankruptcy; student loans and criminal fines, penalties and forfeitures. Those debts which are secured will be discharged, however, expect the creditor to take the necessary legal steps to take back the property. In many cases if the debtor’s equity interest in the property is exempt, the debtor may retain the property by redemption or reaffirmation.

Disclaimer:
Bankruptcy Disclaimer: This information deals with Chapter 7 consumer bankruptcy. Each state has its own bankruptcy laws. You need to check with your state for details. Information dealing with Chapter 13 bankruptcy and consumer debt restructuring is not discussed in the above. The information contained in the following is provided for general information purposes only and is not intended to be a legal opinion nor legal advice nor is it intended to be a complete discussion of all the issues related to the area of Chapter 7 consumer bankruptcy. Every individual’s factual situation is different and you should seek independent legal advice regarding specific information.

Note: American Pacific Mortgage Corporation is not a credit repair company; this information is for information purposes only. We are not licensed credit repair specialists or counselors.

*The views, articles, postings and other information listed on this website are personal and do not necessarily represent the opinion or the position of American Pacific Mortgage Corporation.

One of the major benefits of filing for protection under Chapter 7 is that many creditor actions are stayed. This means that debt collection efforts and foreclosure is halted.

Once a creditor or bill collector becomes aware that you have filed for bankruptcy protection, he or she must stop all efforts to collect the debt. After your bankruptcy is filed, the court mails a notice to all the creditors listed in your schedules. This usually takes a couple of weeks. If this is not soon enough, then you should have your representative inform the creditor immediately. If a creditor continues to use collection tactics once informed of the bankruptcy they may be liable for court sanctions and attorney fees for this conduct.

After your bankruptcy is filed, the court mails a notice to all the creditors listed in your schedules. This usually takes a couple of weeks. If this is not soon enough, then you should have your representative inform the creditors immediately. Your attorney deals with your creditors. It may be the only time you ever have the luxury of saying “you’ll have to talk to my lawyer.”

Bankruptcy Disclaimer: This information deals with Chapter 7 consumer bankruptcy. Each state has its own bankruptcy laws. You need to check with your state for details. Information dealing with Chapter 13 bankruptcy and consumer debt restructuring is not discussed in the above. The information contained in the following is provided for general information purposes only and is not intended to be a legal opinion nor legal advice nor is it intended to be a complete discussion of all the issues related to the area of Chapter 7 consumer bankruptcy. Every individual’s factual situation is different and you should seek independent legal advice regarding specific information.

Note: American Pacific Mortgage Corporation is not a credit repair company; this information is for information purposes only. We are not licensed credit repair specialists or counselors.

*The views, articles, postings and other information listed on this website are personal and do not necessarily represent the opinion or the position of American Pacific Mortgage Corporation.

When making financial decisions during the process, you should consult your attorney. In particular there are three items worth mentioning:

  • Under bankruptcy law, certain luxury purchases over $1000 within 60 days of the bankruptcy filing are presumed non dischargeable.
  • Under bankruptcy law, cash advances aggregating $1000 within 60 days of the bankruptcy filing are presumed non dischargeable.
  • Debts involving materially false financial statements are non dischargeable under certain circumstances.

If you file the bankruptcy yourself, you must fill out the forms. There are several forms. There could be between 30 and 60 pages in your petition, schedule and other papers filed at the time of your bankruptcy. You must follow the local and federal bankruptcy court rules in completing the forms. Preparing these forms requires an understanding of both bankruptcy law and local state law in order to enter the information correctly and accurately. The forms have to be typed and a certain number of copies must be included with the filing. Today, many attorneys use a computer system to prepare these forms because of there complexity and voluminous nature.

About 30 to 40 days after you file the bankruptcy you will have to attend a hearing presided over by the bankruptcy trustee. This hearing is called the First Meeting of Creditors. At this hearing the trustee will ask questions under oath regarding the content of your bankruptcy papers, assets, debts and other matters. After the trustee is done, your creditors will be permitted to question you. Do not worry, your attorney will be there to represent you and your attorney will help you prepare for the hearing. Sometimes, after your hearing is over, various creditors will approach you to discuss the status of secured property or your desire to retain a credit card. Your attorney will negotiate with them, with your knowledge and approval.

After this hearing you will normally not need to return to court. However, if a creditor files a motion or an adversary action, you will likely have to return to court. This is the exception and only your attorney can determine if this is likely to happen.

Under normal circumstances, the bankruptcy court will automatically issue the discharge 60 to 75 days after the First Meeting of Creditors.

You can reestablish credit though and be back in “A” credit two years after the discharge of Bankruptcy. The bankruptcy is a judgment and will be listed for a period of up to 10 years after the discharge. You must wait 6 years to file again or if your bankruptcy was dismissed you must usually wait for 180 days to refile.

Bankruptcy Disclaimer: This information deals with Chapter 7 consumer bankruptcy. Each state has its own bankruptcy laws. You need to check with your state for details. Information dealing with Chapter 13 bankruptcy and consumer debt restructuring is not discussed in the above. The information contained in the following is provided for general information purposes only and is not intended to be a legal opinion nor legal advice nor is it intended to be a complete discussion of all the issues related to the area of Chapter 7 consumer bankruptcy. Every individual’s factual situation is different and you should seek independent legal advice regarding specific information.

Note: American Pacific Mortgage Corporation is not a credit repair company; this information is for information purposes only. We are not licensed credit repair specialists or counselors.

*The views, articles, postings and other information listed on this website are personal and do not necessarily represent the opinion or the position of American Pacific Mortgage Corporation.