FORMER CHAPTER 13 TRUSTEE STAFF ATTORNEY
FREQUENTLY ASKED QUESTIONS WITH ANSWERS
2. ARE THERE ALTERNATIVES TO FILING FOR BANKRUPTCY
Yes, there are alternatives to filing for bankruptcy. The alternatives will largely depend upon your personal financial affairs. To discuss viable options, please complete the free evaluation or call 716-573-4980.
3. HOW IS MY PROPERTY AFFECTED BY FILING BANKRUPTCY?
Generally speaking, bankruptcy law provides protections (known as exemptions in bankruptcy law) of certain assets or items of property that you own. It depends on the specific asset as to whether it is protected or may need to be turned over. Bankruptcy law permits debtors to protect assets based on the necessity of the asset. Note: If there is an asset not qualified for an exemption, it may still be protected. To learn more about specific assets and how to protect assets, please review the questions below or refer to the free questionnaire page to have your specific questions answered.
4. IS MY HOUSE SAFE IF I FILE?
Typically, your house can be protected. It depends on the amount of equity of in your home. Bankruptcy law in New York affords a $50,000.00 exemption in equity to each debtor. Generally, equity is defined as the value of your asset minus the loan secured by the asset. For example, if you are the sole-owner of a home and the value is $100,000.00 with a mortgage of $50,000.00, you have $50,000.00 of equity in your home. Using this example, your home would be protected under bankruptcy law. Also, in the event you have more than $50,000.00 equity in your home, you may be eligible to file for Chapter 13 bankruptcy which would protect your home as well.
5. WHAT ABOUT MY CAR? CAN I PROTECT IT IN BANKRUPTCY?
Generally, your automobile will be protected if you file for bankruptcy. New York law allows a $2,400.00 exemption of equity in a automobile. What does this mean. This means that if you own a vehicle and the value is not greater than $2,400 over the secured loan, your vehicle will be protected. If your value exceeds the $2,400 equity amount, your vehicle can still be protected under a buy-out option or a Chapter 13 bankruptcy.
6. WHAT DEBTS ARE INCLUDED IN BANKRUPTCY?
In most situations, all of your unsecured debt will be cancelled (also known as discharged) in bankruptcy. Unsecured debt consists of credit cards, store cards, medical bills, personal loans not secured by assets, etc… However, certain debts may not be discharged. Typically, these debts include child support, marital obligations, etc…
7. WHAT ABOUT STUDENT LOANS? CAN THEY BE CANCELLED?
Contrary to popular belief, student loans can be discharged in bankruptcy. However, it is very difficult to discharge these loans. To qualify for student loan discharge, one must meet a hardship test created by the Court. This test has a very high standard, but not impossible to meet. The answer depends on your particular circumstances. For more specifics and to have your circumstances evaluated, please fill out the questionnaire.
8. CAN I DISCHARGE MY TAX OBLIGATIONS?
Typically, certain tax debts can be discharged in bankruptcy. This will depend on how old the tax debts are and whether the taxes were timely filed. Generally speaking, if the debts are three years old, they may be discharged. This does not necessarily occur in all situations. For more specific information, please fill out the questionnaire.
9. WHAT IF I TRANSFER MY PROPERTY TO FAMILY AND/OR FRIENDS?
Transfers of property within one year of filing bankruptcy can be cancelled by the Bankruptcy Court. However, the Court can look back farther than one year under certain circumstances. This may or may not be problematic depending on the asset and its value.
10. WHAT ABOUT MY DIVORCE OBLIGATIONS, CAN THEY BE DISCHARGED?
Generally, divorce obligations will not be discharged in bankruptcy. It depends on the particular obligation. For example, are you seeking to discharge child support? If yes, the Court will not be likely to discharge that responsibility. However, if you have other unsecured debt that makes it difficult to meet your support obligations, bankruptcy could eliminate those responsibilities, making it easier to meet your support obligations.
11. CAN I STOP A WAGE GARNISHMENT?
Typically, wage garnishments will be stopped upon the filing of a bankruptcy petition. In other words, when a bankruptcy is filed, all creditors must cease from taking any action against you or your assets. Creditors are refrained from any collection activity on your account. This includes: phone calls, lawsuits, mailings and any other form of collection.
12. CAN I STOP FORECLOSURE PROCEDINGS?
Foreclosure sales will be prevented upon the filing of bankruptcy as long as they are filed timely. It may be possible, though not recommended, to file bankruptcy on the eve of a foreclosure sale to prevent a sale. However, this is not recommended as bankruptcy planning tools may not be implemented based on the shortage of time. One must plan properly for bankruptcy. In other words, you should contact Mr. Yehl before or at the onset of a foreclosure proceeding.
13. CAN I STOP NAGGING CREDITOR PHONE CALLS AND CORRESPONDENCE?
Nagging creditor calls must cease upon the filing of a bankruptcy petition. This means that those harassing creditors are prevented from any contact with you once your petition is filed.As a matter of fact, once you retain Mr. Yehl as your attorney, creditors must cease communication upon notification of the retention. To begin the process and retain Mr. Yehl, complete the free evaluation or call 716-573-4980.
14. I HAVE A SMALL BUSINESS, DO I QUALIFY?
Small businesses do qualify for bankruptcy protection.
15. WHAT IF I HAVE HIGH INCOME, CAN I STILL FILE FOR PROTECTION?
High income does not bar an individual from filing for bankruptcy. It may be taken into consideration when seeking to qualify for a chapter 7 bankruptcy. However, high income does not necessarily mean one has high disposable income. A typical high wage earner has high expenses. This means that a high wage earner may not be in a better financial position than a low wage earner.
16. WILL MY SPOUSE BE AFFECTED IF I FILE FOR BANKRUPTCY?
Typically, if you are married and the debt is entirely in your name, your spouse will not be affected by your filing for bankruptcy protection. It is not uncommon for one spouse to file for bankruptcy while the other chooses not to do so.