Frequently Asked Questions in Bankruptcy Cases
Question: Will bankruptcy destroy my credit?
Answer: No. Bankruptcy can actually help improve your credit score if your current score is low. If you have a good credit score when you file bankruptcy, you will experience a decreased score after you file for bankruptcy. Within two years of filing for bankruptcy, however, you might be able to raise your score back to around 700 if you take steps to create good credit and do not have any derogatory accounts.
Question: My bank account is frozen. Is there anything you can do to help?
Answer: Yes. If you file bankruptcy within ten days of the account freeze, we can demand that the account garnishment is lifted.
Question: I am embarrassed that I can't repay my debts, and I feel guilty.
Bankruptcy was created to give individuals a fresh start because you have a right take care of the necessities for you and your family before paying your creditors. Also, remember that the Lord's Prayer commands us to both forgive and be forgiven. It is recognized that bad things happen to good people. The sooner you get your finances back on track, the sooner you will feel the relief of having handled the situation.
Question: I owe taxes. You can't help me with those, can you?
Answer: Believe it or not, many taxes and almost all tax penalties are actually dischargeable in bankruptcy. However, it takes a thorough analysis of your tax accounts to make the determination of what is or isn't dischargeable. Even if some of your tax debt is not dischargeable, we can help you with a Chapter 13 or Chapter 11 Plan of reorganization to pay the portion that is not dischargeable over time, and in many cases, interest-free.
Question: Will I lose my assets if I file for bankruptcy?
Answer: In Texas, there are two schemes of asset exemptions available to individuals filing bankruptcy. Both schemes are very generous in different ways. Because of this, it is not common to have a case where assets are taken by a Trustee to pay your creditors. Additionally, if you are one of those people that has an asset with no available exemption, you can choose to file a case under Chapter 11 or 13 where you pay your creditors instead of losing the asset.
Question: How is a bankruptcy attorney paid for their services?
Pricing of Chapter 7 cases depends on the complexity of your situation. Fees for Chapter 13 cases are set by the court, but mostly be paid through your Chapter 13 plan.
Question: If I'm filing Chapter 13, how is my plan payment determined?
Answer: There are multiple factors: i) what secured and priority claims you are required to pay; ii) the Trustee and Court look at your projected disposable income to determine whether your disposable income is sufficient to make a distribution to unsecured creditors. Both factors may fluctuate throughout case upon consideration of claims filed and changes of income. An additional factor that can impact the amount of your Chapter 13 Plan payment is whether you have assets that are not exempt.
Question: If I file Chapter 13 to stop an eviction, when am I required to resume lease payments?
Answer: You are generally required to resume lease payments the first of the month following the Petition Date. i.e., you file on 1/2/18 prior to eviction hearing; you are required to pay rent on 2/1/18. Additionally, you are required to cure arrears within “reasonable time,” which is generally interpreted as six months or before the end of the term of a lease, whichever is shorter. The court may consider additional factors.
If the creditor obtained an eviction judgment prior to the petition date, you are required to pay the amount of judgment into the registry of the Bankruptcy Court with the Petition. If judgment and writ of possession were issued prior to the petition date, the firm could not guarantee that you will be allowed to retain possession of premises.
Question: If my vehicle is repossessed prior to filing Chapter 13, can I get it back?
Answer: Yes, the creditor is required to return the vehicle if the bankruptcy is filed within ten days of repossession, provided that you have full coverage insurance on the vehicle and possess a valid driver's license.
Find A Bankruptcy Lawyer in Dallas County, TX
Many people who are considering filing for bankruptcy either file Chapter 7 or Chapter 13. Some of the most common questions our potential clients have in the initial consultation are how bankruptcy want to know how the bankruptcy will affect their mortgage, and whether bankruptcy really gives you a fresh start.
While bankruptcy can be a stressful process, it does not have to be. With the experienced bankruptcy attorneys at Littlefield Law Firm, your experience with bankruptcy can be smooth and efficient. Our lawyers are committed to helping you throughout the bankruptcy process, from start-to-finish. Contact the experienced bankruptcy attorneys in Dallas, TX, at Littlefield Law Firm to discuss your case.
Call (972) 812-0900 today.
This article was last updated on Friday, February 16, 2018.