Bankruptcy FAQ

We try to anticipate questions you might have about our Bankruptcy service and provide the answers here. If you need additional information send email to

1. Will I lose any property, assets or belongings?

Bankruptcy laws protect what you own. These are called “exemptions”. Most, if not all, of your assets (including automobiles and certain amounts of equity in your home) are “exempt” allowing over 99% of our clients to keep everything and lose nothing. You have the right to protect your assets and we can help you do so.

2. How soon can you stop calls from my creditors?

IMMEDIATELY! We know, and understand how frustrating it is for creditors to call you. Once you sign up with us we will insure that your creditors do not call you.

3. Can you stop wage garnishment?

Yes. Any wage garnishment must immediately stop when your case has been filed.

4. Will I have to go to court?

Yes, but it is nothing to worry about because we can have an attorney be present to represent you or we can prepare you prior your hearing date so that you are ready. Only one hearing is required which takes place usually 3 weeks from the date of filing. This short hearing, called a “341a Meeting of the Creditors” usually lasts less than 45 minutes.

5. How does bankruptcy affect my credit?

Chapter 7 or a Chapter 13 Bankruptcy remains on your credit report for up to 10 years. However, you can immediately begin re-establishing your credit after your case is filed. Since you are wiping out your debts and cannot file again, credit companies would be willing to extend credit to you again. By not filing Bankruptcy, your credit report may show negative information for 7 years from the time you become current. By filing, negative reporting stops immediately. This allows you to begin re-establishing credit faster by keeping house, auto or other payments current. Ask us about our special credit program to rebuilding your credit quickly.

6. Can you stop home forclosures?


7. When can I purchase a new home?

After discharge, you may immediately assume a sellers loan or, after about two (2) years, you may possibly qualify for a new home loan (depending on your income and your re-established credit record). Additionally, there are many mortgage lenders who specialize in extending credit to those people who file Bankruptcy.

8. What kinds of debts does Bankruptcy eliminate?

A Chapter 7 Bankruptcy will eliminate most all unsecured debts (credit cards, loans) but not secured debts such as your car or home. To keep your car and home, payments must kept current. In a Chapter 13 case you pay all or only a portion of your debts, depending on how much disposable income you have each month.

9. Can you remove a lien?

If the lien was not incurred to purchase the asset, was not consensual, and impairs your ownership interest in property (an exemption), it may be possible to have the lien removed by using lien avoidance techniques.

10. Will my employer be notified?

No, unless your employer is also a creditor or you authorize a wage deduction in a Chapter 13 case. Your payroll department would have to be notified of your filing in order to stop a wage garnishment.

11. Will my bank accounts be affected?

Typically not. However, if you owe your bank or credit union money (your bank or credit union is an unsecured creditor), close the account and move to a bank where you owe nothing. Otherwise, at time of filing, your bank could offset or freeze your account.

12. Does Chapter 7 or 13 stop lawsuits and judgments?

Yes, immediately when we file your case.

13. Can I get out of a contract?

Yes. In both a Chapter 7 and Chapter 13 bankruptcy case you can cancel unwanted contracts as long as you discontinue the service and/or return the merchandise. Examples of this could include an agreement with an Exercise/Gym facility you no longer wish to attend or a lease/loan on a returned or unwanted Automobile.

14. What about back taxes?

In a Chapter 13 Bankruptcy you pay back taxes without interest, or further penalties over the course of your payment plan. In Chapter 7 – Bankruptcy, secured taxes, such as property taxes, cannot be discharged. However, unsecured, personal income taxes may be discharged if the taxes are 3 years old, you filed timely, you have not been assessed the taxes in the prior 240 days and you have not entered into a written “offer in compromise” to settle the debt.

15. Do you have more questions?