Q. I have seen advertisements for cheap flat rate bankruptcies, and/or my accountant has offered to do my bankruptcy, why should I hire a lawyer instead?
A. Financial debt is overwhelming. When you hire our firm to file your bankruptcy petition you will receive a competent and experienced legal assessment of your specific financial situation, that will help correctly determine your eligibility for a specific bankruptcy discharge in accordance with the United States Bankruptcy Code.
At Usar Law Group, you will be represented competently and professionally during every step of your bankruptcy petition. When you hire us, we will be your bankruptcy attorneys until you successfully obtain a bankruptcy discharge decree.
Q. What does Chapter 7 bankruptcy mean?
A. Chapter 7 of the United States Bankruptcy Code allows certain eligible debtors to ask a Bankruptcy Court to release (discharge) them from personal liability from specific debts (usually consumer debts) and to prohibit creditors from taking any further action against the debtor personally to collect those debts, based on the debtor’s financial inability to pay those debts. Chapter 7 provides for the sale of a debtor’s nonexempt and/or certain valuable property and the distribution of the proceeds from those assets to creditors (i.e., liquidation).
Q. What are some of the consequences of filing bankruptcy?
A. Bankruptcy is not always the best option and it carries many serious consequences. For instance, once a debtor is granted a Chapter 7 discharge a debtor cannot file again for such relief for 8 years. A bankruptcy filing also remains on a debtor’s credit report for up to 10 years affecting their ability to get future credit, making it very difficult to obtain a mortgage, lease a car, may sometimes affect employment, the renting or leasing of an apartment.
Certain property may be sold to pay off creditors. Under Chapter 7, a debtor will only be allowed to keep certain property that is valued at a certain amount, this is referred to as exempt property. The type of property and the value of the property is based on federal and state laws that specify what may or may not be claimed. Property not exempt will be sold or turned over to the debtor’s creditors to pay off debts.
Under Chapter 13 a debtor also has to wait at least two years before they may again file for relief under that chapter.
Some debts are not dischargeable. Child support, alimony, student loans, and income taxes owed, certain secured debts, among other debts are not erased and filing bankruptcy will not discharge these debts. On the other hand, child support payments, alimony payments, and social security payments, pension, among others, that are paid to a debtor are exempt property that a debtor may keep.
Failure to be fully transparent when filing a bankruptcy petition, like not disclosing assets, or not accurately disclosing information can result in denial of a discharge, discharge of the bankruptcy case, and/or criminal prosecution. A certain tristate area “Real Housewife” famously serves as an example. As such, careful consideration before filing, in addition to effective legal representation when filing, are essential.
Q. Can I stop collection companies from calling me, prevent my utilities from being shut off, prevent garnishments, etc.?
A. Filing for Chapter 7 or Chapter 13 relief triggers an immediate automatic stay against collection activities related specifically to debts incurred during the pre-filing of your petition for bankruptcy, delaying and stopping foreclosures, repossessions, garnishments, and utility shut-offs. This includes an end to harassing and intimidating calls and letters from collection companies and creditors.