What is bankruptcy?
Bankruptcy is the legal method for a debtor to discharge or relieve debt.
One of the primary purposes of the bankruptcy act is to relieve the honest debtor from the weight of
oppressive indebtedness and to provide the debtor with a fresh start. The Bankruptcy Code regulates
what chapter you must file under, what bills can be eliminated, how long payments may be extended,
what possessions you may keep, and all other details concerning the bankruptcy.
Will filing bankruptcy affect my credit rating?
Yes. However, most individuals are able to rebuild
their credit within a few years.
How long will a bankruptcy show on my credit reports?
Credit reporting agencies may not report a bankruptcy case on a persons
credit report after ten years from the date the bankruptcy case is filed.
What is a Chapter 7 bankruptcy?
Chapter 7 cases are commonly referred to as straight bankruptcy
or liquidation cases. An individual debtor is allowed to claim certain property exempt; in
exchange for this, the debtor gets a discharge, which means that the debtor does not have to
pay certain types of debts.
What is a Chapter 13 bankruptcy?
Chapter 13 is a debt repayment chapter. It generally permits
individuals to keep their property by repaying creditors out of their future income. Each Chapter
13 debtor proposes a repayment plan that must be approved by the court. After completion of payments
under the plan, Chapter 13 debtors receive a discharge of most debts.
What chapter should I file under?
Your particular circumstances will determine the best chapter
for you to file under. Due to the intense personal nature of any legal issue we suggest
that you consult with an experienced bankruptcy attorney to ensure your issues are effectively
resolved.
What is a discharge?
The discharge order is issued by the court and permanently prohibits
creditors from taking action to collect dischargeable debts against the debtor personally; this
does not prevent secured creditors from seizing collateral if payments are not kept up, or other
creditors from pursuing property of the estate. Some debts are not dischargeable; this means,
that if the debt is determined non-dischargeable the debtor is still obligated to that creditor.
What is a secured debt?
A secured debt is a debt that is backed by property. A creditor
whose debt is secured has a right to take property to satisfy a
secured debt.
What is an unsecured debt?
A debt is unsecured if you have simply promised to pay someone a
sum of money at a particular time, and you have not pledged any
real or personal property as collateral for that debt.
What is the creditor's meeting?
A meeting of creditors is the single hearing all debtors must
attend in any bankruptcy hearing. The hearing permits the trustee or representative of the United States Trustees Office to review the debtor's petition and schedules with the debtor face-to-face.
What is a reaffirmation agreement?
A reaffirmation agreement is an agreement by which a bankruptcy debtor
becomes legally obligated to pay all or a portion of an otherwise dischargeable debt. Reaffirmation
agreements are strictly voluntary.
Must I complete a briefing from a credit counseling agency
before I can file for bankruptcy?
Yes, all consumers who plan to file for bankruptcy must complete a credit
counseling session from an approved provider and receive a Certificate of Counseling before filing.
Must I complete an approved class on debt management techniques
before I receive my bankruptcy discharge?
Yes, all consumers who have already filed for bankruptcy must complete a
personal financial management course and receive a Certificate of Debtor Education before their case
can be discharged.
Where can I obtain more information about the credit counseling session and the personal financial management course?
http://onlinecounsel.cccsatl.org/b4ufile/
