One of the most common forms of filing, Chapter 7 bankruptcy — or liquidation bankruptcy — can efficiently and effectively eliminate your debt. Specifically, Chapter 7 is a preferred solution for those who are seeking relief from unsecured debt, including credit cards, medical bills, and more. This process may involve the liquidation of some of one’s assets, allowing them to be discharged from their debt in about five months on average. Additionally, the filer is protected from creditor harassment and collections via an automatic stay, meaning they will no longer be subject to intrusive phone calls, mail-in bills, and other forms of personal contact.

If you have further questions regarding Chapter 7 bankruptcy, call Eileen Dolaghan today.

A Chapter 13 bankruptcy is also called a wage earner’s plan. It allows individuals with regular income to develop a plan to repay all or part of their debts. Under Chapter 13, debtors propose a repayment plan to make installments to creditors over three to five years. If the debtor’s current monthly income is less than the applicable state median, the plan will be for three years unless the court approves a longer period “for cause.” If the debtor’s current monthly income is greater than the applicable state median, the plan generally must be for five years. In no case may a plan provide for payments for longer than five years. If you have further questions regarding Chapter 13 bankruptcy, call Eileen.

No. If you otherwise keep your credit clean after the filing of bankruptcy, your credit can be largely rehabilitated in about three years after you receive the discharge of debts in bankruptcy. You must reestablish your credit, by paying bills on time, making car payments on time, when you do establish new credit cards, use them wisely and pay the statements in a timely manner. If you have further questions regarding bankruptcy, contact Dolaghan Law.

Yes. Credit card debt is the common debt when a person files for bankruptcy. Almost all credit cards are those unsecured debts, meaning the creditor (whoever issued your cards) cannot claim an interest on any items purchased with those cards. Therefore, those debts are discharged and forgiven in full in Chapter 7.  In Chapter 13 unsecured debts, like credit cards, will be repaid over time, through your debt consolidation process. The amount repaid – if any – will depend on calculations surrounding your income, expenses and assets.

No, although it is often wise for both husband and wife to file a bankruptcy together if both have significant joint debt. If they both owe on a credit card debt, and only one spouse files for bankruptcy, the credit card company will demand payment from the spouse not filing for bankruptcy. If you have further questions, contact Eileen at Dolaghan Law.

Filing for bankruptcy can be effective in dealing with your home through a variety of circumstances, including:
– Helping you catch up if you are behind on your mortgage by giving you more time
– Getting rid of unsecured second mortgages and lines of credit against the home
– Dissolving other debts so you may afford your mortgage payment

In today’s market, many people are now “underwater” with their homes or mortgages, meaning the home is worth less than the amount owed on mortgages.

If you were hit by the market collapse, lost your job, going through a divorce, facing overall debt or other circumstances leading causing you to fall behind on your mortgage payments, Chapter 13 may give you the time to make up the missed payments and continue with current mortgage payments. If you have multiple loans against your home, you can sometimes get rid of the secondary mortgage if the home is worth less than the first mortgage.

Yes, a credit counseling class must be completed prior to the filing of your bankruptcy case. Credit counseling classes can be attended in person, on the phone or on the internet. Once the credit counseling class has been completed, a certificate will be issued which must be filed in your bankruptcy case. Certificates of credit counseling go stale after six (6) months, so the class should be taken shortly before you plan to file. If you have further questions, contact Eileen Dolaghan today.

The answer is yes you can! Sometimes after the discharge of a chapter 7 the need may arise for a person to seek bankruptcy relief again but they are not eligible for a chapter 7 because eight years have not passed since the filing of their case. Relief can be found in filing a chapter 13. If it is less than four years since the chapter 7 case was filed you may not receive a discharge. Nevertheless, whether an individual can receive a discharge or not relief can be found by filing the chapter 13 and the automatic stay imposed by the bankruptcy filing gives the debtor time to save property and reorganize debt into a more affordable payment plan.

The chapter 20 option is filing a chapter 7 followed by filing a chapter 13 shortly after the chapter 7 has been discharged. This strategy is employed to reduce debt repayment in a chapter 13 plan. Many times an individual may need to reorganize the payment structure of a secured debt or to repay a tax liability but they also are carrying a lot of unsecured debt that may have to be paid back during a chapter 13 plan. If the debtor is eligible for a chapter 7 a strategy is employed to discharge all the unsecured debt under the provisions of a chapter 7 and then file a chapter 13 shortly thereafter to reorganize the secured debt or save property under the protection of the automatic stay.