When filling out the questionnaire please list every creditor you can think of INCLUDING relatives, friends, etc. If a debt has been turned over to a collection agency, list both the original creditor and the collection agency. It is very important that you show complete and accurate names, mailing address, zip codes and account numbers for every creditor. Debts not listed will not be discharged. If you disagree with a debt (whether or not you owe it), list it anyway and notify our staff so the debt can be disputed. If you fail to list a debt the creditor may contend the bankruptcy does not apply to that creditor.
The following are some types of debts that you may not think to list:
1. Did you co-sign on a car loan or credit agreement together with someone else? If you did, please be sure to list that person’s name and address, and the creditor.
2. Were you recently, or are you now involved in any kind of lawsuit? Are your wages being garnished? If so, please give us the details.
3. You must list child support and alimony obligations in your bankruptcy. This type of debt is not dischargeable but it must be listed.
4. Student loans. this type of debt is also not dischargeable but must be listed.
5. List any taxes, State, Federal or local, that you may owe. This enables us to advise you if the tax will be discharged in the bankruptcy.
Issues Regarding Ch.7 Bankruptcy Secured Debt
When you enter into certain debts, you sometimes sign papers, which entitles your creditor to a “secured interest” in or a lien on your merchandise. This occurs with real estate, cars, mobile homes and when purchasing major (expensive) consumer items such as refrigerators, freezers, furniture and etc. Also, if you have obtained a loan (usually a personal loan) where you have had to “put up collateral”, you have entered into a secured debt transaction. When your petition for bankruptcy is filed, your secured creditors are stopped from taking your merchandise, but only temporarily, if you have merchandise purchased from a secured creditor, or have given items you own as collateral for a loan, you are faced with the following choices:
1. You can keep the merchandise and continue to pay the amount owed. If you decide to do this, your account should always be kept current.
2. You can allow the merchandise to go back to the creditor you purchased it from or to the lender. Your debt is then cancelled with that creditor.
3. You can pay off the debt at the merchandise’s Fair Market Value. This amount is usually considerably less that the actual amount that you owe. If this applies to you, please mention it when you see us.
Lien Avoidance
If you obtained a personal loan where you put up personal property as collateral & the money you borrowed was not used to buy that property, you are entitled to file a lien avoidance action. This entails considerable paperwork and court hearings so there is an additional charge for this extra service. Please discuss this possibility with us to see if you would qualify.
If a creditor has obtained a judgment against you and recorded it in the county in which you live, then the judgment is a lien against any real estate that you may own in that county. This means that the judgment has to be paid from the proceeds of any sale. If this has happened to you and you own your residence, we may have to remove the judgment from your home. This motion should be filed while you are in Bankruptcy. We rely on you to let us know if a judgment is outstanding. This requires a motion and court hearing. So there is an additional fee for this motion.
Reaffirmation
The final option is to “reaffirm the debt or contract”. This means you sign a new contract with the creditor for the amount you still owe and the creditor will arrange monthly payments with you. If you choose to “reaffirm”, please realize that your bankruptcy will no longer protect you against this debt. It will have to be completely paid by you. A “reaffirmation contract” may be reviewed by the Bankruptcy Court and it may necessitate your attendance in Court for approval by the Judge.
IRS Refunds
If you anticipate receiving a refund from the IRS, please advise us. Depending on the time of year, some of that refund may have to be turned over to your trustee.
DO NOT, UNDER ANY CIRCUMSTANCES, ENTER INTO A “RAPID REFUND” LOAN.
Property Exemptions
You do not lose all that you own when you file for bankruptcy. Listed below are some of the exempt items you are allowed to keep. Personal property is valued at its garage sale value in order to determine the exemption amount.
Property exemptions vary depending on your personal situation. This aspect of consumer bankruptcy can be complex and require an Attorney to evaluate your situation it many situations. At your consultation our office will evaluate and give you further information regarding exemptions for your situation.
