Bankruptcy - FAQ
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How does bankruptcy help me?
Bankruptcy helps the debtor (the person filing for bankruptcy) by getting them out of most kinds of debt. Most debt can be completely eliminated in a Chapter 7 bankruptcy or paid back in one lump monthly sum in a Chapter 13 bankruptcy filing. Filing for bankruptcy will allow the debtor to regain control of their finances in order to make a fresh start.
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Does everyone qualify?
No. Qualification for bankruptcy is based on a combination of your total debt and the amount of income you will be bringing into the household. Your attorney at Elder Law Firm, P.C. will help you decide which is the best option is for you.
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How long does it take to file bankruptcy?
The time period for bankruptcy filing can be as long as a few weeks or as short as the same day you visit. Emergency bankruptcy filings are available through the court’s electronic filing system. The process may be expedited if you furnish the necessary documentation to your consultation.
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What documentation should I bring to my consultation?
In order to determine whether or not you qualifyto file for bankruptcy, or what type of bankruptcy you will qualify for, you will need to furnish your tax returns for the previous two years, a list of monthly expenses, as well as all information pertaining to your current debt situation.
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Will bankruptcy stop repossessions, foreclosures, or garnishments?
Yes. Filing for bankruptcy will place a “stay” on your assets to stop you from losing them. This stay will inform creditors they may not take any action against you regarding your assets.
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Does filing for bankruptcy mean that creditors will stop calling me?
Yes, filing for bankruptcy absolutely means that they will stop calling you. After Elder Law Firm files your bankruptcy, your creditors are only permitted to contact us.
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How exactly does my debt go away when I file for bankruptcy?
When you file under either a Chapter 7 bankruptcy or Chapter 13 bankruptcy, an agreement is made between you and your creditors. Under Chapter 13 bankruptcy, you will repay your debts over a period of three to five years. Under Chapter 7 bankruptcy, you are relieved of your responsibility to pay most debts and creditors will no longer be allowed to contact you. This process is called a discharge of debts and means that your obligation to pay a debt is eliminated.
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How long does the discharge take during bankruptcy?
With Chapter 7 bankruptcy, the discharge usually occurs within 60 days. Under Chapter 13 bankruptcy, the discharge is complete as soon as all payments are made in the three to five year period.
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Will all my debts be discharged in bankruptcy?
No, there is a chance that all your debts may not be discharged in bankruptcy. Debts like child support, taxes, student loans, or other debts incurred from a debtor inappropriate behavior (debts from a drunk driving charge, etc.) will not be discharged in a bankruptcy filing.
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What effect will filing bankruptcy have on my credit score?
Filing for bankruptcy will affect your credit score. However, credit scores are not permanent and you can rebuild it to a high rating over time. Creating and sustaining a solid and responsible credit history post-bankruptcy will help to speed up this rebuilding process.
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How do I recover from bankruptcy?
The financial impact of a bankruptcy will not last forever. Under the Fair Credit Reporting Act, your bankruptcy may remain on your credit report for no more than ten years. In acuality, you can start rebuilding your credit before long before ten years has passed, and you will probably be able to improve your credit score in a much shorter period of time.
At Elder Law Firm, we will discuss your individual situation, advise you about the bankruptcy process, prepare the paperwork for your bankruptcy filing and appear with you at bankruptcy court.
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Does Elder Law Firm inform its clients of meeting times and dates during the bankruptcy process, or will I need to find that information on my own?
At Elder Law Firm, P.C., we make sure you are informed during every step of the bankruptcy process. You will always be notified of any upcoming events in your bankruptcy case. If you provide an email address, this information will also be sent to you via e-mail at your request.
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What happens at my free consultation for a bankruptcy filing?
At your consultation, you will be able to ask the attorney any questions you have. From there the attorney will help you decide your options regarding bankruptcy and give you all the appropriate paperwork and information.
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Do I have to make a decision to file for either Chapter 7 or Chapter 13 bankruptcy at the first meeting?
You ablsolutely do not have to make a decision to file for bankruptcy at the insitial meeting. This consultation is for your benefit. Many clients wish to take the information home and discuss it with a family member or spouse. You will have as much time as you need to decide to file for bankruptcy or not.
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After my bankruptcy consultation, will I be able to contact Elder Law Firm if I have more questions?
Yes! Unlike other firms where clients are left in the dark, Elder Law Firm wants you to be involved. If you have any questions regarding your bankruptcy case, you may call the firm and speak to one of our trained professionals at any time.
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I am married and I want to file for bankruptcy, but my spouse does not. Can I file for bankruptcy by myself or does my spouse have to file for bankruptcy with me?
A person can file for bankruptcy as an individual or jointly, depending on the advantages or disadvantages of each. In order to determine which is better for you, it is advised that you consult with a bankruptcy attorney.
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What are some of the financial pitfalls of divorce?
Sometimes debt overwhelms you during or after your divorce. Many people file for bankruptcy – and a growing number of them are women. More women than couples now ask the courts to declare them legally insolvent and distribute whatever property they have to their creditors. You may want to consider filing for bankruptcy if you have large debts that are likely to stop accumulating and you cannot negotiate a good resolution with your creditors.
Generally, it may be in both spouses’ best interests to file a joint bankruptcy on their marital debts before filing for a divorce. This way, they may be able to eliminate some debts that otherwise would be subject to division during the property settlement portion of the divorce.
For example, if the couple has a lot of consumer debt like credit cards, they may be able to discharge that debt in a Chapter 7 bankruptcy filing. If you are having financial difficulty, you can discuss filing Chapter 7 bankruptcy with your attorney. Your attorney will help you by working in conjunction with your accountant and investment advisor.
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I have decided to file for bankruptcy. How do I get started?
Each person or couple’s situation is different, and a Chapter 7 bankruptcy filing or a Chapter 13 bankruptcy filing may or may not be in your best interest. You may contact Shelley Elder at Elder Law Firm for a confidential consultation.
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In addition to my bankruptcy attorney, are there any other sources that I can refer to for financial information or advice?
Ruth Upchurch, Enrolled Agent (tax professional licensed by the Internal Revenue Service to represent taxpayers before the IRS) is an experienced tax professional and can also assist you in conjunction with your attorney. Contact Ruth Upchurch via the following link:
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