Commonly Asked Questions Regarding Bankruptcy

Question

What “Chapter” of Bankruptcy do you handle?

Answer

I handle Chapter 7 matters, which eliminate unsecured debt like credit cards and medical bills.

I do not handle Chapter 13 cases because I cannot guarantee a successful outcome. Many Chapter 13 matters include a re-payment plan where the Court decides what you can pay. In most cases, the individual feels they cannot afford the Court deemed payment.

Question

What is this “New Law” I’ve heard about?

Answer

It’s not a ‘new law’, but an amendment to an old law. The main change is that additional paperwork is required and often times more red tape. Income levels are also a factor now. Generally, if a household with two people grossing under $50,000 a year, or a household with four people grossing under $75,000 a year, they can qualify for Chapter 7 more easily. You may still qualify if your income is above these levels.

Question

What counties do you handle?

Answer

I handle cases for those that live in the following counties of Massachusetts: Middlesex, Essex, Norfolk, Suffolk, Bristol and Worcester. If you live in New Hampshire I handle Rockingham, Hillsborough, Nashua and Merrimack counties.

Question

What does it cost?

Answer

I charge $1800 which can be paid all at once or over the course of preparing your petition for Bankruptcy. This fee includes the $299 charge to file the Petition with the Court.

Question

What are the steps?

Answer

The first step is to call my office and set up a consultation, either via phone or in person. If you choose to proceed with the bankruptcy, I will mail you paperwork explaining the process as well as a client questionnaire.

Next we would put an end to creditor harassment. You can give creditors our phone number, 978-453-4500, and we will handle it. Although they will stop calling your home, that does not mean the problem is solved, we still need to proceed with your bankruptcy in a timely manner.

After the fees and court costs are paid, we will review all your paperwork to make sure everything is accurate and up-to-date. You will also need to obtain a certificate from a credit counseling agency, this is required by the Court. This can be done online or over the phone.

Your Petition will then be filed with the Court after our final review for accuracy. The date the petition is filed is called the ‘filing date’ and is the legal date that matters. After this date, you get a fresh start.

Approximately 4-6 weeks after filing, the court will schedule a meeting with the bankruptcy trustee assigned to your case to verify identification and information on the petition. This should be the only time you’ll need to be present in Court.

Finally, approximately 60 days after your meeting, a ‘Discharge of Debts’ is filed.

Question

How long does it take?

Answer

After filing your petition, the process is generally complete within 3 to 4 months.

Question

Can one spouse file alone?

Answer

Yes. This will have no impact on the assets or credit report of the non-filing spouse. It’s common for couples recently married where one spouse is entering the marriage with a lot of debt.

Question

I had a car repossessed a long time ago and now they’re coming after me for the balance, can this be discharged?

Answer

Yes. Chapter 7 will allow you to discharge debt owed towards a deficiency incurred from a repossession or foreclosure.

Question

What if a creditor continues to call me?

Answer

Generally, once you give a creditor my contact information, they will stop calling you. If they do call, just keep repeating ‘you need to contact my attorney’ and they will get the message.

Question

What if I receive Legal papers?

Answer

You should call my office and let me know what you received. Generally, if it’s a ‘Summons’ or a ‘Summons and Notice of Pre-Trial Conference’ I would advise you to ignore it. The money owed will be eliminated after bankruptcy so there is no need to defend yourself. If you receive a ‘Subpoena’ or other order, I will advise you what to do. It may be necessary to file your petition quickly.

Question

Can I still be sued once I have retained you?

Answer

Yes. If your petition is not filed in a timely manner you can be sued. I encourage clients to continue paying down their bankruptcy fee balance so if this does happen we can be close to filing. We generally receive advance notice prior to any liens or wage garnishments taking place.

Question

Do I need to list my house and/or my vehicle even if I want to keep them?

Answer

Yes. Although all secured debt needs to be listed, you can indicate which debt you intend to keep. You must prove to the court that you do not own the asset free and clear. If you intend to keep the asset, you must remain current on your payments. On the other hand, if you choose not to keep an asset, you can stop making payments and the item will be repossessed or foreclosed on sometime after that and you will not be responsible for it once the bankruptcy is filed.

Question

Do I need to list all of my credit cards, small doctor bills, etc.?

Answer

You are encouraged to list all of your debt, although many people leave off small debts. The Trustee (the lawyer who represents the creditors) may ask you if you’ve listed all your debts and will expect you to say yes. Any debt not listed will not be discharged. You can list a debt and still continue to pay it. If you choose not to list a credit card, a creditor may still find out about the bankruptcy by doing a random credit check and may cancel your card. Your bankruptcy petition can be amended to add a debt prior to the discharge of your case for a $100.00 fee. After your case is closed or discharged, you will not be able to amend your petition without leave of court. Your case is generally closed within 3-4 months after your petition is filed.

Question

How long does it usually take to re-establish credit?

Answer

You can usually get credit right away, but it is at a higher interest rate. It takes about 2 years to obtain good credit lower interest rates. In some cases, if you have a steady job and maintain good credit, it only takes about 6 months to get a low interest car loan and 2 years for a low interest mortgage loan.

Question

I feel guilty, like a failure, or that this is something terrible, am I alone in this feeling?

Answer

No. The following are some statistics to put things in perspective:

• Bankruptcy filings are almost double that of divorce filings. You probably know several people who have filed bankruptcy, they just haven’t told you.

• Anyone can experience a sudden loss of income or unexpected medical issues. Bankruptcy can affect all income brackets, from those on Social Security to doctors and lawyers.

• Some examples of famous companies/people that have filed bankruptcy and bounced back are: K-Mart, Regal Cinemas, Abraham Lincoln, Larry King, Burt Reynolds, Mike Tyson, Walt Disney and Donald Trump. And these are just a few.