One of the most powerful tools of bankruptcy—the "automatic stay"—can stop your car or truck from being repossessed by its creditor. The automatic stay is the law that automatically goes into effect the moment your bankruptcy case is filed to stay—or stop —all collection activity against you or your property. Filing a Chapter 7 or Chapter 13 case … [Read more...]
Stop a Home Foreclosure with Chapter 7 or 13
The bankruptcy power called the "automatic stay"immediately stops a home foreclosurethe moment your bankruptcy is filed. What happens after that depends on whether you file a Chapter 7 or Chapter 13 case, and on what you want to accomplish. Buy Some Time with Chapter 7 A Chapter 7 "straight bankruptcy" cancels an immediately pending foreclosure … [Read more...]
A More Complicated Chapter 13 Case
In the absolutely simplest Chapter 13 case you pay a monthly amount each month based on what you can afford and it's divided prorata among your unsecured debts. So, say, you pay $300 for 36 months, and all of your debts are paid 20% of what you owe, and at the end of the case all the remaining debts are discharged—written off. But Chapter 13 … [Read more...]
The Big Differences between Chapters 7 and 13
The two main consumer/small business bankruptcy options are quite different. Each one has its advantages and disadvantages. So, for many people Chapter 7 is much better, for others Chapter 13 would be. And for others it's a closer call. Even if you have your mind set on one or the other, it's important to discuss both alternatives with your … [Read more...]
Non-Bankruptcy Alternatives
Bankruptcy is not the best option for everyone. If your financial problems look like they can be solved other ways, those alternatives should be explored. Consider both their advantages and disadvantages honestly. Here are three bankruptcy alternatives, highlighting their risks and concerns: 1. Debt Settlement: Once a debt goes into extended … [Read more...]
Who Does What in Bankruptcy?
It's a lot easier to make sense of bankruptcy if you know who's who in the process. Debtor: The person or business filing bankruptcy. A debtor and spouse can file a joint petition in bankruptcy. The debtor has various duties which your attorney will help you with. The debtor's most important duty is simply to be honest and cooperative throughout … [Read more...]
The Bankruptcy Chapters
A Summary of the Chapter Options Each Chapter of bankruptcy is designed for certain kinds of debtors, and certain kinds of circumstances. For consumers and small business owners, usually either Chapter 7“straight bankruptcy” or Chapter 13“adjustment of debts”is appropriate, or occasionally Chapter … [Read more...]
So What is Bankruptcy?
Bankruptcy is not a single thing. It's a set of different legal options for people and businesses to deal with their debts. It's in the U.S. Constitution The U.S. Constitution specifically authorizes bankruptcy. It gives Congress the "Power . . . To establish . . . uniform Laws on the subject of Bankruptcies throughout the United States." (See … [Read more...]
Writing off Non-Support Debts to an Ex-Spouse
Confusing Divorce Debts and Bankruptcy Law In a Chapter 7 "straight bankruptcy" case you CANNOT discharge—legally write off—ANY obligations arising from your divorce decree. This includes support-related and non-support divorce debts. But under Chapter 13 "adjustment of debts" you CAN discharge NON-SUPPORT divorce debts. This is a confusing … [Read more...]
Pay off Newer Income Taxes at Your Own Pace through “Adjustment of Debts”
Chapter 13 vs. Chapter 7 with Income Taxes Chapter 13 is a court-approved payment program which usually takes three to five years to successfully complete. While you might think that being in a payment program doesn't sound nearly as good as simply discharging (legally writing off) your debts in a Chapter 7 case, the fact is that some debts … [Read more...]