A Fresh Start

Most consumers who file bankruptcy have always paid their bills on time, worked hard and done their best to make a positive and successful future for themselves and their family. For them the thought of filing bankruptcy can be horrific. It may suggest failure and come with a deep sense of guilt. However, there is no shame in filing bankruptcy!

Automatic Stay

When an Chapter 7 is filed an automatic stay goes into effect. The automatic stay is similar to a restraining order. A Bankruptcy automatic stay generally prohibits the commencement or continuation of any acts to collect on a debt that arose prior to filing the bankruptcy. Filing bankruptcy can therefore often stop creditor harassment and give you breathing room while preparing for a fresh start. If your property is being foreclosed the pros and cons of a Chapter 7 and the impact the automatic stay has on a foreclosure should be discussed with counsel.

Reaffirmation Agreement

 A common question is what happens to your vehicle after you file bankrptcy? If there is no loan on the vehicle and the vehicles qualifies it may be protected by your attorneny using bankruptcy exemptions. If there is a a loan on the vehilce and repayment does not impose undue hardship, then reaffirmation may be a possiliblity. Debtors may in certain circumstances keep making payments on motor vehicles during and after a bankruptcy filing.  A reaffirmation agreement is an agreement between the original lender and the debtor reaffirming a preexisting debt and subsequently allowing the debt to survive the bankruptcy. Whether a reaffirmation agreement is possible and appropriate is best discussed with your attorney.

Filing a Chapter 13 Bankruptcy: Repayment

Unlike a Chapter 7 bankruptcy a debtor does not receive an rapid discharge of their debt.  A Chapter 13 bankruptcy is designed for individuals who have a source of income and can pay back a portion of their debts, through the bankruptcy trustee. A proposed repayment plan is created and subject to approval  at a confirmation hearing, the the plan is payed over a period from 3-5 years before a bankruptcy discharge will be granted.