Bankruptcy Frequently Asked Questions:

Filing for Bankruptcy will generally lower someone’s credit rating.  The impact of filing on your credit is one of the factors we will consider during your consultation.  However, most people who have reached the point where Bankruptcy has become advisable, will likely already have a low credit score due to missed payments and a high utilization of available credit.  Also, once the bankruptcy discharge of debt has been granted, the debtor will once again, over a period of time, be able to reestablish credit. 

Employers are usually not notified when a chapter 7 is filed.  While a trustee can contact an employer to seek information as to the debtor’s wages or salary, they typically satisfied with 60 days worth of pay stubs or pay advices along with copies of 2 years of tax returns. 

No.  Filing chapter 7 or chapter 13 bankruptcy is permitted under federal law and is not a criminal proceeding, and a person does not lose any civil or constitutional rights by filing.

No. It is illegal for either private or governmental employers to discriminate against a person as to employment because that person has filed for bankruptcy.  It is also illegal for local, state, or federal governmental units to discriminate against a person, such as the granting of licenses, permits, student loans, and similar grants, because that person has filed for bankruptcy. 

No.  Certain property is exempt and cannot be taken by the trustee on behalf of creditors.   What property is exempt and what property may be required to satisfy debts can vary based on the type and value of the property and whether or not that property has a valid mortgage or lien against it.   In many chapter 7 cases, the trustee will determine there are no assets available for creditors and the debts will be discharged without any surrender of property.  This will be discussed in detail at your first consultation. 

This is a very common question for home owners who are faced with overwhelming debts.  In many cases, the debtor will be able to keep their home, but this will depend on a number of factors, including the current status of their mortgage payments, how much equity has been built up, the income of the debtor, and what other assets and debts the debtor has.   In our free consultation will discuss these factors and determine what options are available in each person’s specific situation, including chapter 7 or chapter 13 bankruptcy.