Bankruptcy | Bankruptcy Information

Are you considering bankruptcy, but you do not want to give up your car? Do you know your options when it comes to your car? You could ask an attorney, but they will charge you for their time. There is a pretty easy answer to the question, "do I have to claim my auto loan on a bankruptcy?"

First, if you need to keep your car, then you do not have to claim it on your bankruptcy. You do not have to wipe out all the debts, but you will probably have to show that you have paid your auto loan on time and can continue to do so. This is not always the easiest thing to do especially if you have not been on time with the car payments.

Second, the judge will be the sole decider in whether or not you have to claim your auto loan. If the judge decides that you need to claim it, then your car will be repossessed and you will have the loan cleared with your bankruptcy. If you get to keep it, then you have to continue to make the payments just like before.

Last, your best bet is to either sell the car and pay off the loan or take out another loan to pay off the car. It is much easier to keep a car that is paid off and your lawyer will be able to argue for you better if it is paid off. This works out best if the car is not worth much because it is not as big of an asset.

First of all, you're not alone. Filing bankruptcy is probably one of the most difficult decisions you'll ever make. So, let's make sure you comprehend exactly what filing bankruptcy means and how it will affect your life. The following guide to filing bankruptcy will help you to understand what goes on behind the scenes.

Bankruptcy, as you know, has changed over the last 3 years. In October, 2005 new federal laws made it harder to file Chapter 7 bankruptcy (total liquidation) and instead required you to file Chapter 13 bankruptcy (repay at least partial debt).

When filing bankruptcy you'll probably hire an attorney. Attorneys charge a fee ranging from $1,500 to $2,500, payable up front. Its best if you have all your financial matters organized as this will help the attorney give you advice and, take some of the stress off of you. With today's economy, bankruptcy is commonplace. Most, if not all bankruptcy attorneys are extremely busy, so don't expect explanations or phone calls returned promptly.

Once your list of creditors is known and all required paperwork is done, the attorney will have your bankruptcy petition filed in your county. After the court accepts your petition, there will be a meeting of your creditors, a meeting you must attend. Some, not all, creditors might file an objection to your bankruptcy petition and may bring you to court regarding the balance of your account.

During this process, you are required to receive debt counseling. Also at this time you will be assigned a trustee. The trustee will overlook both the creditors and debtors filings to make sure everything is done properly under the law.

The day you file your Chapter 7 bankruptcy until the day it's done usually takes 3 months, depending on your situation. Chapter 13 bankruptcy means you will be repaying some of your debt; usually a lesser amount with lower interest. So, Chapter 13 bankruptcy can range from 3-5 years to complete.

What should you expect after your bankruptcy is complete? You should know that if you file a Chapter 7 bankruptcy it will reflect on your credit score for 10 years. Chapter 13 bankruptcy demonstrates you're taking some responsibility for your debt therefore your credit score will be affected for 7 years.

Please note: If you file a Chapter 7 bankruptcy you will not be permitted to file bankruptcy again for another 8 years. Also, Chapter 7 bankruptcy does not mean all debt will be discharged. Things like child support, most student loans, and any taxes (federal, state and local) owed will need to be paid by you.

Filing bankruptcy can be a daunting task. Think deeply about all the consequences you'll face, now and in the future. And, in today's world bankruptcy may be the only option. It's not your fault. Most Americans were unaware the economy was crashing. So, this guide to filing bankruptcy should help you to have an idea of what to expect. See if bankruptcy is an option for you. Knowledge is power.

Many people don't realize that there are 6 types of bankruptcy chapters. Not all apply to the average individual, but this information may be of interest to you now or sometime in the future.

Under the United States Code, there are actually 6 types of bankruptcy chapters entitled under the Federal Bankruptcy Code. Below you will find each type of bankruptcy and see what each means.

The 6 bankruptcy codes are listed below:

• Chapter 7 - most people and/or businesses file chapter 7 for total liquidation of all eligible debts
• Chapter 9 - when a municipality files bankruptcy
• Chapter 11 - is filed when a business or sometimes an individual who wants to reorganize their debt
• Chapter 12 - is for family farmers and family fisherman
• Chapter 13 - is for individuals who wish to reorganize their debt with a repayment plan
• Chapter 15 - is regarding international cases

The most popular bankruptcy filing is Chapter 7. This allows the individual to liquidate most of their debt. Chapter 7 bankruptcy usually takes 3 months from start to finish. Consumers should know that Chapter 7 bankruptcy will reflect on their credit score for 10 years. Also, once you file Chapter 7 bankruptcy, you will not be permitted to file bankruptcy again for another 8 years. One last point, Chapter 7 bankruptcy does not mean all debt will be discharged. Things like child support, most student loans, and any taxes (federal, state and local) owed will need to be paid by you.

Most people know little about Chapter 9 bankruptcy. Chapter 9 bankruptcy calls for the resolution of municipal debts. Only a handful of municipalities have filed Chapter 9 since its inception in 1937. In 1994, Orange County, California filed a multi-million dollar Chapter 9 because the County Treasurer-Tax Collector misappropriated the county's tax dollars. He left the entire county bankrupt. This case personally affected me as I lived there and worked with the County of Orange at the time.

Chapter 11 bankruptcy is filed when a business or corporation needs to reorganize their debt. The corporation makes a plan to repay their debt in order to stay in business.

Chapter 12 bankruptcy is intended for family farmers and family fisherman who have normal income but high debt. Usually this type of bankruptcy allows these families to suggest a plan to repay all or part of their debt.

Chapter 13 bankruptcy is for individuals who wish to reorganize their debt with a repayment plan. Chapter 13 demonstrates you're taking some responsibility for your debt, therefore your credit score will be affected for 7 years instead of 10 years under Chapter 7.

Chapter 15 is basically a new chapter added in 2005 when Federal Bankruptcy Laws were changed. It involves methods for dealing with cases involving debtor issues for international cases.

As you can see, the 6 types of bankruptcy chapters will not involve most people. Federal Law has taken into account all types of circumstances so most people and corporations have the opportunity to alter and/or relieve their debt problems. If you fall into one of the 6 types of bankruptcy, please consider all you options.

Over the last few years, bankruptcy laws have seen major change. In the old days, you could simply decide to file bankruptcy on a whim. If things were going semi-bad for you and you wanted to start over, you could do so easily. It didn't really take that long and you got a fresh start pretty soon afterwards.

Today, this is merely a pipe dream. With all of the changes that have come into bankruptcy law recently, people view it as a completely different animal now. What new rules does bankruptcy have and how do they affect you?

For one thing, bankruptcy takes special circumstances in order to file. Being stupid with your credit card and racking up $30,000 worth of debt probably isn't going to qualify anymore. You need something really bad to happen in order to file bankruptcy. We're talking a death of someone significant, an injury, something completely unexpected, etc. You can no longer just wake up one day and decide to file bankruptcy. It takes a seriously legitimate reason.

One of the more significant changes involving bankruptcy laws is the waiting period. If you file bankruptcy, several years must pass before you can file again. In the old days, you could do it much more frequently and you could do it more times. Now, you have to wait a lot longer, depending on which type of bankruptcy it is.

Besides this, only certain types of debt are even considered for bankruptcy. In previous years, you could basically wipe your whole slate clean. It was a total annihilation of your debt. Now, there are several types of debts that will not be erased. Even if you file bankruptcy, you'll probably be liable to repay certain debts. This is no longer a clean slate device as it once was, except in extreme cases.

Another vast difference in new bankruptcy laws is that you must be approved by a bankruptcy judge before you can even file. This means that you have to get all of your most compelling evidence gathered up and go before a judge. Then, depending on the judge's discretion, they will decide whether or not you can file for bankruptcy. This means that you can no longer decide on your own whether or not you want to file. Someone else has to physically approve it before it can go through. If they think that your circumstances aren't bad enough or could have been avoided, you are still going to be on the hook for your debt.

Before you decide to try and file bankruptcy, you are strongly encouraged to have an attorney go over bankruptcy laws with you. They can look at all of the facts of your case and help you decide whether or not you should move forward. Without the help of a trained professional, you could waste a lot of time and money working on a lost cause. When in doubt, the best thing you can do is seek the advice of a bankruptcy lawyer. They have extensive experience in the laws that you'll need to review.

Bankruptcy advice varies, depending on who you ask. A credit card debt reduction company might say that it's better to just stick it out, settle your debts and establish a monthly payment schedule, even if it takes you five years to finish it! Needless to say, many of the debtors set up on such plans drop out and file for bankruptcy anyway.

If you were to ask a lawyer, then they might say that bankruptcy is the only option for you, while asking for more than $250 just to file. Many people find they can't come up with the lump sum to go through with it and feel they are beyond all hope.

Bankruptcy advice has gotten more liberal over the years due to changing laws. To avoid scores of debtors flooding onto the streets with no property and nothing left to live for, the laws have changed to allow debtors to keep certain property, despite filing for bankruptcy. The debtor may keep up to $2,500 in cash, $2,400 in auto equity and unlimited 401k funds.

Additionally, by law, employers cannot fire an employee who files for bankruptcy, although potential employers can choose not to hire a new employee based on that factor. Often with a filing, debtors will need to attend credit restoration and debt management courses.

When you're seeking advice about bankruptcy, be sure to double-check what can and can't be discharged. For instance, you'll still have to pay off Uncle Sam if you owe taxes for the past three years. However, if you have personal income taxes over 3 years old, then you can discharge them through bankruptcy. Fiduciary taxes cannot be discharged, nor can most student loans and liens. If you owe child support or alimony, you will still have to pay up.

If you don't list debts on your bankruptcy petition, then they will not be covered. If you have debts from drunk driving or other "willful and malicious" harm, you'll still have to pay your dues. However, there are many things that can be removed when you file for bankruptcy, such as all unsecured credit card debt, wage garnishments, utility termination, fraudulent credit claims and foreclosure.

After you receive bankruptcy advice, there are a few things to consider before you file. First, be sure you can't negotiate with your creditors, reduce your balances with a settlement letter or arrange a monthly payment plan. Generally speaking, if you can only afford minimum monthly payments on your bills and cannot pay off all your balances in five years, then you should file for bankruptcy and then focus on credit restoration services.

Thinking of filing bankruptcy? Before you do, pull out your calendar and the phone number for your bank. The day you choose to file could save you (or cost you) thousands of dollars.

Here's why: the assets that you own on the day you file are the only assets that are considered in your case. That means they're the only ones that creditors may be able to get to. Some assets pretty much retain the same value during the course of a month, like your car or your home furniture, for example. But the money in your checking account tends to fluctuate day to day. Right after you deposit your paycheck, your account has a higher balance. For a brief moment, it looks like you're flush, right? Then comes time to pay all the bills. You start writing checks for rent, electric, cable, groceries, gas, health insurance, and all your other regular expenses. Pretty soon those checks clear and your account is back to that minimum balance again.

That's the day you want to file your bankruptcy - when all your bills for the month have been paid, and your account balance is at its lowest point. It doesn't matter if you're going to deposit your next paycheck the day after filing bankruptcy: It is the balance in your account on that day that you file that counts as your asset. And not all assets are exempt. Research your state's particular wage exemption laws, or consult with an experienced bankruptcy attorney in the state where you'll be filing your petition. The type and amount of wages in a bank account which are exempt from creditor attachment varies from state to state.

No matter which state you live in, it's always a good idea to file your bankruptcy when your bank account is at its lowest balance. And here's one last thing to keep in mind: just because you wrote those checks doesn't mean your account balance reflects it. So don't go by what's written in your checkbook register - go online or call your bank to get an exact account balance before you file your bankruptcy petition. This simple little strategy can save you thousands of dollars that might otherwise go to your creditors in bankruptcy.

Filing bankruptcy is not a decision to be made lightly, as it is likely to affect your ability to obtain a mortgage, a car loan, or a new unsecured credit card for quite some time into the future. In this day and age, your credit report will very likely be pulled when applying for a new job, an apartment lease, and car insurance.

The process of filing bankruptcy should not be an exciting process that you look forward to, but instead should be viewed as your last resort option. It may indeed be your best and perhaps only option, but it should only be considered when you have exhausted all other options after a thorough investigation into what other options are possible and available to you.

While bankruptcy may alleviate much of the financial stress you may be feeling due to your mountain of bills, which seems to get higher every day, it may not be the total answer for you. Yes, bankruptcy will stop the creditor harassment calls since after you have filed, your creditors are no longer allowed to call you or hound you, and that will almost certainly provide a certain amount of relief. Having your bills under control will also provide a great amount of relief, but to what end? You still have the long road back to getting your finances under control.

Many institutions understand the fact that the majority of people who are filing bankruptcy these days are not doing so because of their own financial mismanagement or trying to live a champagne lifestyle on a beer budget. They understand that most of the consumers who file do so due to unexpected circumstances that they have no control over, such as high medical bills, a job layoff, a messy divorce, or similar things. So they may cut you a bit of slack if you are trying to get a loan, a credit card, finance a car, or whatever when they see that you have filed for bankruptcy in recent years. But that still tells them that you are a higher risk and they will therefore set repayment plans and interest rates accordingly because you naturally now fall into a higher risk category for the funds or credit they are going to give you.

But even so, if you decide that bankruptcy is your best option, make sure you know what you are doing. With the recent sweeping changes of the bankruptcy laws, this is no longer a do-it-yourself process as it used to be in years past. In fact, you must be approved to file by the judge, and there is no guarantee that just because you want to file that you will be allowed to do so.

You also need to decide and be approved for the chapter of bankruptcy that you want to file. With Chapter 7, most debts are able to be discharged. Note the word "most", since there are some types of debts that cannot be discharged by bankruptcy. But you may only be approved to file Chapter 13 which is like a "reorganization". This means that your debts are reorganized, not wiped out or discharged, to make it affordable for you to repay them. But the key point here is that with Chapter 13, the debts are not wiped out, you still have them and need to repay them.

The best advice that can be given is to encourage you to get together with a qualified bankruptcy lawyer who understands the laws of your state and can help you understand what your options are and how the paperwork needs to be completed in what steps if you decide to move forward. Most people filing bankruptcy have found that they save themselves an order of magnitude more time, money, and assets by using a qualified attorney than what they pay out in legal fees. This is not the time for you to make yet another mistake, so consider your options carefully.