Bankruptcy

Helping You Make Informed Decisions

If you are planning to file bankruptcy, get in touch with us, Our firm has represented bankruptcy clients since 1980 and may have more experience than many other firms who offer these services.

Speak to our bankruptcy attorneys concerning that choice. Bankruptcy will help you to gain relief from debt collectors, those calling you incessantly on the phone, perhaps save your home or other assets, stop garnishments and gain a fresh start.

Understanding the History

Bankruptcy has long been a part of American, and even English, jurisprudence. It is based on the premise that people besieged by debt collectors cannot be fully productive and are entitled to relief from debts that bankruptcy provides. Several Presidents and business entrepreneurs have filed for bankruptcy in their life and made the turnaround necessary to transition into later success.

Monahan & Johnson
Monahan & Johnson

Types of Bankruptcy

The most common types of bankruptcy for individuals are Chapter 7 and Chapter 13. Which option is most appropriate for your situation should be discussed with the attorney?

There are many advantages to filing for bankruptcy. For instance, bankruptcy stops all legal proceedings against the debtor. This means if you have been sued or are having your wages garnished, the Court proceedings must stop. This is called the “automatic stay.” Other benefits include: creditors are prohibited from commencing lawsuits against you, prohibited from having any contact with you (except through your attorney), and debtors are often able to keep most of their property through the use of what are called exemptions. Exemptions allow you to keep certain types of property up to certain dollar amounts. This means that you do not have to give the bankruptcy trustee exempt property.

An obvious disadvantage to filing bankruptcy is that certain debts are not dischargeable. This means that even after the bankruptcy case is over, you will still have to repay the debt. Such debts include certain taxes, fines, restitution, child support, maintenance, and most student loans. In addition, certain creditors may be allowed to foreclose or obtain ownership on secured items (however, as stated above, the debtor does have the option to reaffirm the debt with the creditor thus, keeping the secured property). A further disadvantage is that a bankruptcy will hurt your credit rating for several years.

However, at the same time, those seeking bankruptcy relief often have challenging credit ratings based upon their debt load.

Our Belief

We have believed that poor credit and no debt is a better situation than poor credit and overwhelming debt because once the debt is gone, it is easier to transition into a more favorable credit situation.

Documents You Need

To file a bankruptcy, a debtor must file certain documents. These documents include Petitions, certain Schedules, a Statement of Financial Affairs, a Statement of Current Monthly Income, and a Statement of Intention. Further, you will pay a filing fee to the Bankruptcy Court. The debtor then must obtain credit counseling before filing any Bankruptcy Petitions. After filing the Petition, the debtor appears under oath before a Trustee to be examined at a meeting of creditors and could be subject to any creditor’s questions, should a creditor choose to appear at the hearing.

Debts are usually discharged approximately 90 days after filing a Petition in a Chapter 7 bankruptcy case. Debts are discharged in a Chapter 13 bankruptcy case at the conclusions of a payment plan.

Monahan & Johnson