Answers to Common Bankruptcy Questions

Do I Need a Bankruptcy Attorney?

Hiring a bankruptcy attorney costs money, which seems counterintuitive when the reason you're filing is you have more debt than you can handle. However, a lawyer could save you money in the long run. An experienced bankruptcy attorney in Seattle, WA, will have extensive knowledge of bankruptcy laws and state exemptions which will aid you in making the best use of your filing to expedite getting you back on your feet. Furthermore, there is extensive, complicated paperwork required in bankruptcy cases, and an attorney can help you complete these forms and assure you have all the necessary documentation. Also, creditors can object to exemptions you have filed. An attorney will be able to properly respond to these objections for you.

What Are My Bankruptcy Options?

Chapter 7 bankruptcy will wipe out debt quickly, generally in less than four months. It consists of liquidating assets and having debts discharged. This type of bankruptcy is useful for unsecured debt, such as credit cards or medical bills.

Chapter 13 bankruptcy is debt consolidation and takes approximately 3 to 5 years. Rather than lose property, the debtor has a strict budget that is overseen by a court trustee to pay off the debt.  This type of bankruptcy is used primarily for secured debt, such as a mortgage. 

Can I Choose Which Debt to Include?

No. When filing for bankruptcy, all assets and liabilities must be recorded. You may not keep selected credit card accounts open or exclude any information about your finances, property, or debts. If you do, it is considered fraud under the Bankruptcy Code.  

Will I Lose My House and Car?

Maybe. This depends on the type of bankruptcy you declare. As explained previously, Chapter 7 is a liquidation of assets, so you could be at jeopardy of losing your home and vehicle if they are not protected under a state exemption. However, Chapter 13 is set up to prevent a foreclosure or repossession of your car. As long as you adhere to the budget set out for you, you will not lose your personal property.

Will Bankruptcy Erase My Child/Spousal Support Payments?

No. Alimony and child support are not dischargeable debts. You must also continue your maintenance payments during the bankruptcy proceedings. Falling behind on these payments could cause your bankruptcy case to be dismissed.

Will Bankruptcy Erase My Student Loans?

It is not likely. There are certain instances where student loans are discharged, but that is not common. However, in a Chapter 13 bankruptcy, you may be able to include student loans in your payment plan.

Will Bankruptcy Stop Garnishment of My Checks?

Yes. Paycheck garnishment will stop once you have filed for bankruptcy and your employer has been notified.

How Long Does Bankruptcy Stay on My Credit Report?

Bankruptcy, both Chapter 7 and Chapter 13, may stay on your credit report for up to 10 years.

Will Filing for Bankruptcy Keep Me from Finding a Job?

It is prohibited to discriminate against a person for filing bankruptcy. You cannot lose your job for filing bankruptcy, nor can future employers use it against you.

There are a lot of questions that arise when weighing the option of filing for bankruptcy. Consider hiring a bankruptcy attorney in Seattle, WA, to help guide you through the process, answer your questions, and set you up in the best possible position for your fresh start.

Source : articlesbase.com