bankruptcy faq

There are many basic questions, confusion, and even misunderstandings about bankruptcy. What follows are 19 of the more common bankruptcy FAQ we get and hear.

Credit After Bankruptcy FAQ

Question: Will I ever get credit again?

Answer: Yes! You might be surprised to learn you’ll get targeted offers after your case is done. Use one or two cards responsibly and your score will likely go up, possibly even higher than it is now. But surprising at it seems, you will get credit again.

Question: Great, but how long will it take to rebuild my credit, and how long is it reported against me on my credit report?

Answer: Your credit report will show a Chapter 7 bankruptcy for 10 years, and a Chapter 13 bankruptcy reported for seven years from the date you filed.

Question: So I won’t get credit again for seven or ten years?

Answer: Actually, if you’re pro-active and manage it right, it’s possible to have new and good credit two years after the bankruptcy discharge.

Question: Will I keep my house, car, or other valuables if I file Chapter 7 bankruptcy?

Answer: If done right, you should be able to keep your car and home.  Most cases we file don’t lose their property. Just because a Santa Clarita bankruptcy attorney can protect your belongings doesn’t mean you can if you do this yourself. Lots of people who use a bankruptcy dabbler or paralegal lose things.  Don’t take a chance because it’s just forms.

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Chapter 7 Bankruptcy FAQ

Question: Will I keep my house, car, or other valuables if I file Chapter 7 bankruptcy?

Answer: If done right, you should be able to keep your car and home.  Most cases we file don’t lose their property. Just because a Santa Clarita bankruptcy attorney can protect your belongings doesn’t mean you can if you do this yourself. Lots of people who use a bankruptcy dabbler or paralegal lose things.  Don’t take a chance because it’s just forms.

Question: It’s just forms, can I do my own bankruptcy?

Answer: Yes, and you can do your own surgery and cut your own hair during the coronavirus quarantine. It doesn’t mean you’ll be happy with the result.

Question: What are 5 things that can go wrong if I file bankruptcy without a lawyer or hire a dabbler or paralegal?

Answer: We’re doing this bankruptcy FAQ so that you avoid bankruptcy disaster. So here are just five things that can and do go wrong:

  • Credit card lawsuit for recent usage and/or fraud
  • Bankruptcy trustee sells your house or other belongings
  • U.S. Trustee files motion to dismiss for bad faith
  • Chapter 7 trustee goes after your family or friends for transfers you gave them
  • FBI investigates bankruptcy crimes and puts you in jail

Question: Will my name be published locally where my friends and job know?

Answer: No. While your case is public record if someone has access to the right paid database, it is not easily accessible by using common web search techniques. Only you, your creditors and your bankruptcy lawyer will know.

Question: Will I lose my job if I file bankruptcy?

Answer: It is against federal law to fire someone for filing bankruptcy.

Chapter 13 Bankruptcy FAQ

Question: How is Chapter 13 bankruptcy different from Chapter 7 bankruptcy?

Answer: Chapter 13 is where you make debt repayments on some or all of your debt for a set period of months.

Question: Who decides the Chapter 13 bankruptcy payment?

Answer: You and your bankruptcy lawyer propose it, but it needs to get approved by the trustee and judge.

Question: Why on earth would I want to repay my debt?

Answer: Sometimes you don’t have a choice if you have good income sufficient to pay some of it, or if you otherwise would’ve lost your house in Chapter 7 bankruptcy, and a host of other reasons.

Question: I’m current on my credit card debt and minimum payments, why is a Chapter 13 better?

Answer: Because in Chapter 13 the payment is often less than you’re paying for all the minimums, it freezes interest so you’re not paying it forever, you can’t get sued during this (unlike debt consolidation), and there’s a definite, preset and defined finish line when you’re done. With credit card minimum payments, you’ll be paying interest on those yourself for decades.

Question:  These bankruptcy FAQ were helpful, how can I afford a bankruptcy?

Answer: We offer an affordable bankruptcy program with a flexible payment plan. Contact us now.