Bankruptcy simplified?

Question

So, I need to file bankruptcy. I've thought about my situation for a long time now and I've decided that it's what I want to do. I have a few questions though and figured I'd post on here while I did research.
1) What costs are involved?
2) Do you have to have a lawyer and go to court?
3) Can a business refuse to let you file for your account with them? Can they fight it?
4)I don't know who all I owe money to anymore. I tried to do my credit check but it wouldn't work. When I file, will they be able to bring up all of my debts and creditors?
5)How long does the process take?
6) I have one (or more) account that is with a collection agency that just told me that they are going to send it over to legal services in the next few days. What does that mean? Can I file bankruptcy on this? Is there anything you cannot file on?
7)Will this affect my financial aid at school?
8)What experiences have you had or observed post bankruptcy? What happens and in what amount oft ime?

Answer 1

1. The filing fee (Chapter 7, $299 at the moment) and legal fees or cost of the forms from Staples, Borders, Barnes & Noble, etc. (about $45). They come with instructions. You can download the forms from any bankruptcy court web site, but without instructions. I review drafts of completed bankruptcy forms for MA debtors.

2. No, but remember that a person who represents him/herself has a fool for a lawyer, especially in an area of law with a lot of little gotchas.

3. You MUST list ALL creditors. Any creditor can object to discharge, but they won't, unless you have run up your debt withing the last 90 days on something other than necessities.

4. You should have no problem getting the 3 copies of your credit reports: www.annualcreditreport.com - free, if you don't go for the offers to get your credit score or protect against ID theft.

5. A Chapter 7 takes 6 months, but from filing to 341 meeting (where a trustee examines you under oath about your income and assets) will be about 4-6 weeks. The rest is just waiting for paperwork or time to go by.

6. It means they may sue you. Just include the lawsuit. It will be discharged. You cannot get a discharge from taxes (except federal income taxes due more than 3 years before the date of filing, assuming you filed the returns when you were supposed to), from child support arrears or from student loans (except for a hardship, which is more than just having to file bankruptcy) .

7. No. By law, bankruptcy cannot be considered in student loans.

8. I've been doing bankruptcies (7 and 13) for 35 years. Most people take the opportunity for a "fresh start" and do well. A few do not learn from their mistakes and have to file again years later. Your credit score will improve pretty quickly, and you will get a lot of credit offers after discharge. You may, if your income allows you to pay off the balance every month, want to get one - ONE - credit card with a $300-$500 limit. DO NOT get a higher credit limit. That's enough to hold a rental car or a hotel room, unless you max it out.

Answer 2

Answers to your various questions:
1) the costs vary, court costs for a chapter 7 are 299 and chapter 13 is 274. Attorneys fees for a chapter 7 can range from 500 to 1500 whereas a chapter 13 is somewhere along 2200-3500. You will have to pay a chapter 7 up front a chapter 13 can often times partially be paid through your payment plan depending on your attorney.

2) you don't HAVE to have a lawyer, but bankruptcy is not something to take lightly and having a lawyer is a very good idea. It will be cheaper than paying off your debt to begin with, so look at it as the alternative to paying your debt (if it isn't cheaper, you shouldn't be filing bankruptcy)

3) A business can't refuse to let you file, they can object to discharge, but it's hard for them to object, they must prove fraud or conversion to stop you from getting a discharge (unless it's a nondischargeable debt like student loans, child support or taxes)

4) Did you try annualcreditreport.com? you need all three credit reports as not all creditors report to all bureaus. Additionally, medical bills aren't reported to credit reporting agencies unless they're in collections so pulling your credit report isn't guaranteed to find all your creditors. It is your duty to figure out who all you owe money to. Stop throwing the bills away and keep them and give them to whichever attorney you hire.

5) For a Chapter 7 it takes about 4-6 months. For a chapter 13 it takes 3-5 years.

6) What they are telling you means they are going to sue you for themoney and obtain a judgment. Rest assured you can still file on the debt, if they get a judgment they can garnish your wages but a bankruptcy will stop that.

7) I would thinks so, but speak with a financial aid advisor at school

8) You will be inundated with credit card offers and won't be able to get good interest rates, but you can rebuild your credit. You will probably feel less stressed as all those creditors will not be contacting you anymore once you file.

Answer 3

http://www.answers.com/topic/bankruptcy?cat=biz-fin

this site has alot of answers.....

You are going to hear diff. things from diff people....your best bet is to check your states laws, every state has its own website. Go there, and look up state laws and statutes, and search bankruptcy.

As far as I am aware, I have looked into bankruptcy also:

1. Lawyers fees & filing fees; Can be anywhere from $500-a couple thousand depending on the Attorney and the chapter you are filing as well as the amount of creditors you owe.

2. You don't HAVE to have a lawyer, a paralegal could more than likely file their own bankruptcy, but I wouldn't suggest it unless you know the laws and procedures inside and out.

3. No, a business cannot refuse to allow you to file bankruptcy on a debt you owe them, check out the FDCPA.

4. You need to contact the 3 major credit bureaus, Equifax, Experian, and Transunion. They are all online and you are entitled to one free credit report from all 3 bureaus per year. You do not want to miss any of your creditors when you file bankruptcy, get all of them in there so you can start out fresh.

5. Can take months, can take a year. Have a consult with a lawyer in your area, they will let you know better than anyone can.

6. You can file on all debts aside from federal student loans and back taxes. You will always owe those. The collection agency can do nothing worse than report your debt to the credit bureau. The only debts you need to worry about are the 2 mentioned about government or IRS can and will garnish wages, as well as legal judgments such as if you hurt someone and were taken to court, and the judge ruled against you and you owed money, someone could garnish your wages on a judgment.

7. No, but ask them to be sure.

8. It will take 7+ years for a bankruptcy to fall off your credit report. It will take a good while for you to be able to get credit from most honest creditors. I suggest you do everything in your power NOT to accrue any more debts after filing, you don't want to start all over again. Bankruptcy isn't something we should fall back on when we decide not to pay, its an option for those who can't.

I understand, don't think I'm talking down to you or think bad of people who file....Its a fact of life these days...its just the people who do it every 7 years because they don't want to pay their bills I dislike.

Good luck and get a good Attorney!

Answer 4

When i did my BK back in 1996 it cost me 125$ for a paralegal to give me the paperwork to fill out (about 50 pages) and it was a 175$ filing fee. I also had to make i think 4 copies of the documents to be filed which at the time cost about 4 dollars at kincos. A lawyer will run you at least 1200 if you use them and its basically the same thing that a paralegal will do. They give you the paper work with questions for you to answer and then they just make the paperwork all neat and typed up.. If you have forgotten what creditors you have, they can still come after you for the debt if you dont put them on the bankruptcy papers. (there is no central computer or anything that brings up all your debts so you know who you owe money to.) Only way to find out who you owe money to is with a credit report if you have forgotten. Oh you also have to send paperwork to all the creditors letting them know you are filing BK which will costs you 41 cents for each stamp you need to use. The whole process once you file take 90 days. Then you go before a judge and tell him why you cant pay or he just looks over your BK papers and makes comments. Then he says "ok you are Bankrupt" You can not put your student loans on bankruptcy or any taxes you owe the government. Once you are bankrupt, you will start to get a letter or two from companies saying that you commited fraud and they will not pursue you if you sign a peice of paper saying you will pay back the debt. (this is just a scare tactic and I never signed any of the papers and they never came after me nor did i ever hear from them again.) Two years after my BK i got credit card offers again and started building my credit back up.

But let me make a suggestion. I dont know anything about your income, but if your debt is under 10k, you might as well pay it. My debt when i was only 21 was over 41,000 dollars (and that was back when 41,000 was alot of money!) Despite what people say about BK going off your credit in 7 years it doesnt. It stays for the full 10 years, right up to the very day. I was so happy when it went off my credit report and my score finally hit 700 again.

Answer 5

Have you checked to see if you pass the "means" test for filing for Chapter 7 in your state? If you haven't you need to do this...otherwise it's pointless expending energy when you don't even know if you qualify to file. Also, if most of your debt load involves student loans....you can't get these discharged anyway in a Chapter 7 filing....

2) Do you have to have a lawyer and go to court? No....I'm all for saving money...but I wouldn't do a "do it yourself" BK unless I had a very simple case. A botched BK filing can come back to haunt you...and you might have to pay several thousand more in legal fees to undo the damage.

If your debt level is below $15K....you should entertain the possibility of attempting a settlement in the 50% range...If you're dealing with collection agencies...you can go even lower...like 30%...Your creditors would almost gladly accept such a settlement as opposed to loosing everything if you file for BK. Get all terms in writing if you do this. Also, not every creditor would agree to this...so be careful.

Without know the specifics of your income/debt level...it's hard to give more advise.

Answer 6

1. just the lawyers fee
2. yes and yes
3. no. (they can fight it but they never do...too much trouble)
4. they will bring up what is in your credit report, but yu also have to know who else has been after you to pay
5.6 mos to 1 yr
6/ yes...everyhting is included up to that day
7. no

Answer 7

It is important that you start by looking at your debt situation as a whole.