What if creditors continue to contact me after filing for bankruptcy protection?
The creditors are then violating the bankruptcy automatic stay and you should contact your attorney to make sure they stop calling you. Once you file for bankruptcy the calls and letters should stop, as creditors are forced to follow the bankruptcy automatic stay.
What are the common reasons for a creditor to file an adversary proceeding in my bankruptcy case?
The most common reasons for a creditor to file an adversary proceeding in your bankruptcy are because a large balance transfer, cash advance, or convenience check was made during the six months prior to the filing of the bankruptcy petition without the intent to repay the debt. The other common reason is making a false application for credit prior to filing for bankruptcy. Most of the reasons for an adversary proceeding in bankruptcy is the creditor thinks that you did something dishonest before filing for bankruptcy, and they want to keep that debt from being discharged in bankruptcy.
What are some of the most common reasons people file for bankruptcy?
The most common reasons people file for bankruptcy protection are loss of job, medical emergency, divorce or separation, and reduction in income at current job. Most people do not have any savings and if any of the above things happen, they cannot continue to pay their credit cards bills.
Can I keep my vehicle if I file for bankruptcy?
You can keep your vehicle if you file a chapter 7 bankruptcy. If you are current on your car payments and go into bankruptcy you can continue to make your regular monthly payments and keep your vehicle. The other alternative is to enter in a reaffirmation agreement with the lender to keep your car after filing for bankruptcy. This is often a bad idea, since it will create a new obligation for you after your bankruptcy is finished. The best option is to continue to make regular payments without signing a reaffirmation agreement and the lender will not typically re-posses the vehicle is regular payments are being made. I have only seen a few instances where a creditor will actually take back the vehicle.
Can I keep my home after filing for bankruptcy?
You can keep your home after filing a chapter 7 bankruptcy. A home is similar to a vehicle in that if you are current on the payments and can afford to make the regular monthly payments you can keep your home. I have not seen a lender require a reaffirmation agreement for quite a while on real estate. The other issue is that in order to keep your home you need to determine the amount of equity you have in your home, since the amount of equity in your home will determine what type of bankruptcy you should file.
What debts are not dischargeable in an Illinois chapter 7 bankruptcy?
The types of debts that cannot be discharged in bankruptcy are certain tax debt, most student loan debt, child support payments, court imposed restitution, court fees, debt incurred through fraud or theft, intentional torts, debts not discharged in previous bankruptcies that were not discharged due to fraud.
What types of debt can be discharged in an Illinois chapter 7 bankruptcy?
Most debts are eliminated with the filing of a Chapter 7 bankruptcy. The most typical debt that is eliminated is credit card debt, personal loans, personal liability for vehicle loans, personal liability for home loans, utility bills, medical bills, and other revolving credit. Give us a call for more information regarding your specific debt.
How does bankruptcy affect my credit score?
Bankruptcy stays on your credit score for ten years, and will have a negative affect on your credit rating. Credit ratings are hard to predict given all the different financial circumstances on each individuals credit score. In some cases credit scores will improve a year after filing bankruptcy and people will actually be offered credit cards again. The most important question to ask is what is my current credit score, and how will it look once I cannot make my payments on time. The answer is probably that your credit score will drop to a similar level with filing a bankruptcy, without the benefit of being debt free.
Once I decide to file for bankruptcy what should I do with my credit cards?
If you have made the decision that bankruptcy is the right choice you need to stop using your credit cards immediately. If you continue to use your credit cards without the intent to repay those cards it could be considered bankruptcy fraud, and may prevent you from eliminating that debt. In most cases you should stop making payments on your credit cards and other debt that can be eliminated. I never like to see clients who continued to use credit cards for large purchases after our meetings. It means that they did not listen to my advice and chose to use credit cards before filing for bankruptcy protection.
Do I have to list all debts on my bankruptcy petition?
You must list all debts and all assets on your bankruptcy petition. You must list all debts even loans from family and friends on your bankruptcy schedules. This is one of the cardinal rules of bankruptcy filing. In Illinois you must list all your debt, otherwise that debt may not be discharged.
What period does the bankruptcy court look at to determine eligibility for a Chapter 7 bankruptcy?
To determine if you are eligible for a chapter 7 bankruptcy your income has to be below the median income for the county where you live. The bankruptcy law provides that to determine eligibility for a chapter 7 bankruptcy you have to look at your previous six months worth of income. For example if you file bankruptcy in November, the law says the six months worth of income is May to October to determine if you are eligible.
Can I file bankruptcy without an attorney?
You can file a bankruptcy without an attorney, but remember the old adage “he who represents himself has a fool for a client”. Bankruptcy filing has been made substantially more complex since the new bankruptcy code went into effect in 2005. If you have any assets that need to be protected you should consult with a Chicago bankruptcy lawyer, to prevent losing those assets to the bankruptcy trustee. The lawyer can provide advice regarding the bankruptcy exemptions, if you make a wrong choice on the exemptions it could cost you more than most attorneys charge for filing a bankruptcy. A chapter 13 bankruptcy should never be undertaken without an attorney, they are very complex and full of local rules and customs that even a well versed consumer would not be aware of. If you are thinking about filing for bankruptcy on your own, at least consult with an attorney, sometimes the cost is less than you think.
Will bankruptcy stop a wage or bank garnishment?
A bankruptcy will stop a wage or bank garnishment as soon as the creditor learns of the bankruptcy filing and the automatic stay goes into effect. In some cases you may be entitled to a refund of the garnished funds in the 90 days before filing.
Will I lose my job if I file for bankruptcy?
You cannot be fired from your job for filing for bankruptcy protection it is part of the bankruptcy code. That does not mean that the employer could not find another reason for your termination.