Bankruptcy Information
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Bankruptcy Chapters 7 & 13
The most common forms of bankruptcy used by most ordinary consumers are Chapter 7 and 13. In a common Chapter 7, the debtor (you) wipes out his or her debts without offering to pay on them. There are certain restrictions to Chapter 7 concerning amounts of property and income. In a Chapter 13, a debtor reorganizes his or her finances by paying some of the debt back over a three to five year period by making payments to the bankruptcy trustee. A Chapter 13 can be used to save homes from foreclosure, stop repossessions, deal with taxes, lower auto and furniture payments and protect property, which might be lost in Chapter 7. At Tom Scott & Associates we strive to fit you with the form of bankruptcy that will work best for your individual situation. If we don't think you should file at all, we will tell you so.
Listing Your Bills
It is your responsibility to provide the names, proper addresses, and account numbers for all your bills. A bill that is not listed in the bankruptcy or that has a wrong address cannot be discharged. You will be given a copy of the bankruptcy papers to keep for your records. It is your responsibility to check the papers in Schedules D, E, and F, to be sure all your bills are listed.
Non-Dischargable Bills
Most bills will be discharged by a Chapter 13 bankruptcy (wage earner plan where you pay your bills), but not all bills can be discharged by a Chapter 7 (called liquidation where you discharge your bills). The following are some of the bills you cannot discharge in a Chapter 7 bankruptcy: taxes, bad checks, child support, student loans, criminal/traffic fines and court costs, accident damage caused by a drunk driver, money/credit obtained after a false credit application was made, and intentional damage to property. Although, you must still list these bills on your bankruptcy with the rest of your bills.
Property You Can Keep
Bankruptcy law provides that you can keep most of what you own free and clear (cars, furniture, personal items, etc.) and thisis called exempt property. You must disclose all your property to the attorney so it can be listed in the bankruptcy. You cannot hide property from the Bankruptcy Court. There are some limitations to what you can keep and the attorney will explain those to you.
