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Bankruptcy stops repossessions and foreclosures. Bankruptcy further gives you relief from creditors and peace of mind. Bankruptcy is a proceeding under Federal law whereby you are granted partial or complete relief from the payment of your debts. This relief is provided in the form of an automatic stay issued automatically and immediately upon the filing of the bankruptcy petition which stops creditors from collecting debts from you. The Bankruptcy court enters an order at the end of the case relieving you from responsibility for paying certain debts. Who can file a Chapter 7: Almost any individual or partnership may file a chapter 7 bankruptcy petition if he or she resides in the US. You can file a Chapter 7 bankruptcy petition regardless of whether or not you are employed. The most common reasons for consumer bankruptcy are: unemployment; large medical expenses; seriously over-extended credit; marital problems and other large unexpected expenses. Who can file a chapter 13 bankruptcy petition? Individuals may file chapter 13 bankruptcy petitions if they: reside in the United States; have a source of regular income; and on the date the petition is filed, owe less than $250,000 in unsecured debts and less than $750,000 in secured debts. (Corporations and partnerships may not file a chapter 13 bankruptcy petition). Will the bankruptcy stop bill collectors from calling? Yes. The automatic stay prevents bill collectors from taking any action to collect debts. Once a creditor or bill collector becomes aware of a filing for bankruptcy protection, it must immediately stop all collection efforts. After you file the bankruptcy petition, the court mails a notice to all the creditors listed in your bankruptcy schedules. This usually takes a couple of weeks. Creditors will also stop calling if you inform them that you filed the bankruptcy petition, and supply them with the "docket number" for your case. In some cases, you or your attorney should contact the creditor immediately upon filing the bankruptcy petition, especially if a foreclosure is pending. If a creditor continues to use collection tactics once informed of the bankruptcy they may be liable for court sanctions and attorney fees for this conduct Does the spouse of a married person also have to file bankruptcy? No. In some cases where only one spouse has debts, or one spouse has debts that are not dischargeable then it might be advisable to have only one spouse file. If the spouses have joint debts, the fact that one spouse discharged the debt may show on the other spouses credit report. Can I keep any credit cards? Under some circumstances you may be able to keep some credit cards if the creditor agrees. There are many factors which must be considered. Some of those include the credit card balance at the time of the bankruptcy, what the credit card company is willing to do and your ability to pay the present and future credit card debt What should I do to prepare for filing bankruptcy? First, you should consult with an attorney. An attorney can help you plan for the bankruptcy, decide when to file a bankruptcy petition, or even avoid filing for bankruptcy. 1. If you intend to file bankruptcy you should stop using your credit cards. If you borrow money with the specific intent of discharging the debt in bankruptcy instead of paying it back, the debt is not dischargeable. 2. Don't transfer your assets to friends, family and business associates to protect the assets from your creditors. The transfer may be considered a fraudulent conveyance. If it is, you may lose both the property and your right to a bankruptcy discharge. 3.Call Brown and Brown, LLP for a free consultation. You will need to bring: 1. all of your secured and unsecured creditor information (who you owe) - balances, accounts numbers and mailing addresses. 2. your income information 3. information regarding your house, your cars and any other assets you have.
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