*UPDATE*BANKRUPTCY QUESTIONS ANSWERED
*UPDATE* MEDICAL BANKRUPTCY INFORMATION

CHAPTER 7 |  CHAPTER 7 HEARING | CHAPTER 13 | CHAPTER 13 HEARING

The traditional bankruptcy is a Chapter 7 bankruptcy.
A chapter 7 bankruptcy involves the discharging of all your debts, except certain taxes, especially those less than tree years old, alimony, child support, student loans less than five years old, debts obtained by fraud, debts incurred in relation to a DUI, certain cash advances less than twenty days before filing, and certain purchases within forty days of filing. In addition, there are some less frequent types of debt which are not dischargeable. If you have any unusual obligations, please mention them to your attorney in the initial consultation.

The discharge of your debts means you will no longer have a legal obligation to pay the debt nor can the creditor attempt to collect from you. However, if the creditor has a lien on your property because you gave him the property as collateral or the creditor has obtained a judgment against you, it will be necessary to take certain steps to enable you to keep the property. The reason for this is that even though the creditor cannot collect the money from you personally, the creditor has an "ownership interest" --- a lien -- a lien -- in the property and has a right to sell the property and take its share. Therefore, if any of your property is secured and you want to keep it, it will be necessary to either agree to continue paying the debt or pay the current fair market value at the time. These options are known as reaffirmation and redemption.

Another option exists in most of the cases not involving land or vehicles -- if you owned the property before the creditor lent you money, it will be possible to keep the property without paying any money through a process known as lien avoidance. The same capability --- lien avoidance --- can be used to eliminate some judgment liens without paying the creditor any money. The practical result of the above law is: At the time you decide to file and have retained us, I suggest you stop paying all debts, except those for houses, land, automobiles, or other vehicles you wish to keep. It is imperative that you keep insurance on any property you intend to keep.

The uncontested Chapter 7 case will take between three and four months from the date of filing to be completed. If your petition is complete and sufficient information has been provided, it will be necessary for you to appear at only one hearing. This hearing will only take five minutes. In all likelihood, none of your creditors will be present, and if any are, I promise I will not permit their questioning to "get out of line." After this hearing, it will take between sixty and ninety days for your debts to be discharged and the case closed.

Finally, it is important to know a Chapter 7 discharge can be obtained only once every six years and one day. Therefore, reaffirming a debt or obtaining new credit is risky because if you cannot pay, your property will be confiscated, and you will be liable for any balance owed after the property is sold.