Common Bankruptcy Questions

Here are 10 of the most commonly asked bankruptcy questions and answers:

1. What is bankruptcy? 
Bankruptcy is a right that US citizens are given to relieve themselves of overwhelming amounts of debt through a legal process. There are 2 main types of personal bankruptcy avaliable: Chapter 7 and Chapter 13.

2. Will bill collectors stop calling me after I file bankruptcy?
Yes! The day that your bankruptcy case is filed with the court is legally the last day that anyone can attempt to collect a debt from you. This is called an “automatic stay” and it protects you from collection attempts until your case is over.

3. Will I have to go to court?
Yes, everyone who goes bankrupt is required to attend a hearing known as the “meeting of creditors”. Although all of your creditors will be notified of the date and time of the hearing it is rare that any will show up.

4. Do I have to list all my creditors when I file bankruptcy?
Yes, since the bankruptcy laws changed in 2005 any and all debt in your name must be listed in your bankruptcy paperwork. This does not necessarily mean that all of your debts and/or property will be erased when your bankruptcy is complete.

5. Will I be able to rent after I file personal bankruptcy?
In most rental situations the landlord will do a credit check and notice that “bankruptcy” is on your credit report. This does not stop them from renting to you, but they may want proof that you are making timely payments elsewhere.

6. How do I know if I should file personal bankruptcy?
You are the only person that can decide if personal bankruptcy is right for you, but if you are facing an overwhelming amount of debt that you cannot see yourself coming out of in the next 1-2 years then personal bankruptcy may be a good option for you. Ask friends or family that have filed bankruptcy how it helped them.

7. Who notifies the creditors that I filed bankruptcy?
Your creditors are notified of your bankruptcy by the bankruptcy court via electronic mail or paper mail via the USPS. You will not be required to communicate with creditors once your case has begun.

8. How do I choose a bankruptcy attorney?
Choosing a bankruptcy attorney may be difficult, but it is well worth the research. Again, you can ask friends or family who have filed, speak with your local bar association, or just call local attorneys and request a free consultation.

9. Can I get rid of student loans or tax debts?
In most cases filing bankruptcy cannot get rid of student loans or tax debts. These debts fall into the category of “non dischargeable” debts that are typically not erased by the bankruptcy court.

10. Can I get credit after filing personal bankruptcy?
Yes! One of the common misconceptions about declaring bankruptcy is that your credit will never recover. The day your bankruptcy is discharged you will be ready to start making positive financial decisions that will quickly begin rebuilding your damaged credit.

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