1. Will I be able to keep my home?
Generally the answer is yes. Most people who file for Chapter 7 relief keep their homes. Homeowners that file bankruptcy are allowed a homestead exemption that allows them to retain a portion of the equity in their home. However, your lender may require you to enter into a reaffirmation agreement which essentially takes your mortgage out of the bankruptcy.
2. Will I lose my automobile(s)?
Probably not. Similar to the homeowner's exemption, individuals that file bankruptcy also get an exemption which protects a portion of the equity in their automobile(s). Likewise, the lender for you vehicle(s) may require you to enter into a reaffirmation agreement which is your promise to repay your loan.
3. Will it ruin my credit?
Filing bankruptcy will likely have an impact on your credit score. However, whether it will have a negative impact depends on your score at the time you file. Generally, most people who are thinking about filing bankruptcy already have low credit scores due to late or missed payments, or overuse of credit. In some cases, individuals see their credit scores improve in a very short time after they file bankruptcy. In other situations, credit scores will generally start to rise within a couple of years of filing bankruptcy.
4. Will I be able to buy a home in the future?
Almost certainly. Filing for bankruptcy does not prevent someone from buying real estate in the future. Generally, after a couple of years, many people will be able to buy real estate.
5. If my spouse does not want to file, will my filing ruin my spouse's credit?
No. Although it often makes sense for both spouses to file together, it is not required. As long as your spouse keeps current with his or her financial obligations, your bankruptcy filing will not have an impact on your spouse's credit score.
6. Will I be able to discharge past income taxes?
Sometimes. Federal and state income taxes that are more than 3 years old may be dischargeable. However, there are several requirements that must be met, and you should consult an attorney to determine whether such taxes can be discharged through bankruptcy.
7. Will I be able to keep personal property?
Yes. Just like with the homeowner's exemption and automobile exemption, individuals have a "wildcard" exemption that covers some or all of their personal property.
8. If I filed bankruptcy in the past, can I file again?
Absolutely. If you filed a previous Chapter 7 bankruptcy, you are eligible to file another Chapter 7 eight (8) years from the date of your previous case. There are no time requirements to file a Chapter 13 bankruptcy, but whether, or not, you can discharge your debt depends on the type of bankruptcy you filed in the past and how much time has elapsed since the filing of your last bankruptcy.
9. Will it eliminate past child support or spousal maintenance?
No. Child support and maintenance, or alimony, are not dischargeable. However, depending on the circumstances, a Chapter 13 may help you get caught up on past due payments through a Chapter 13 plan payment.
10. Will I lose my retirement investments?
Probably not. Most pensions, IRA's, 401(k) plans, and other qualified retirement plans are exempt and you can retain such funds after you file bankruptcy.
11. Will my student loans be discharged?
It is usually very difficult to discharge student loans and generally only attempted in extreme circumstances when an individual has lost much or all of his or her future earning capacity.
12. Will I be able to get my license reinstated if it has been suspended due to parking tickets or other unpaid fines?
In many situations an individual can get his or her license reinstated by filing a Chapter 13 bankruptcy if such suspension is related to unpaid tickets, unpaid toll fines, or certain types of lawsuits due to a car accident.
13. How long does it take to get a discharge?
In Chapter 7, an individual typically receives his or her discharge within 3 to 4 months. However, once an individual files his or her bankruptcy petition, almost all creditors must cease all collection attempts, including harassing telephone calls. In Chapter 13, an individual receives his or her discharge after making all of their payments pursuant to the terms of the plan. Likewise, once a Chapter 13 petition is filed, most creditors must cease all collection attempts.
14. What do I need to bring to my appointment?
You will need to bring your last 6 months of pay advices from all sources of household income. In addition, if you are filing Chapter 7, we will need the last 2 years of federal and state income tax returns or, if you are filing Chapter 13, you will need the last 4 years of federal and state income tax returns. Additional information may be required upon review of your assets and liabilities.