BANKRUPTCY
Bankruptcy is a powerful tool. Congress designed bankruptcy to give you protection from your creditors. When you turn to our experienced
bankruptcy lawyers for help, we use bankruptcy to stop your creditors from calling you, to stop your creditor from garnishing your
pay check, to stop your lender from repossessing your car or foreclosing on your home. In many cases, your attorney can even recover
your car if it has been repossessed before you come to us for help. Talk to our lawyers about getting peace of mind and a clean
start.
Frequently Asked Questions about Bankruptcy:
What is Bankruptcy?
Bankruptcy is a legal proceeding in which you declare you can't pay your debts. Congress
designed the laws to give people a fresh start. If I file for bankruptcy will I lose my house, vehicle or any of my property?
By Federal Law, you are usually able to keep all of
your property that you want to keep, including your house, vehicles, and furniture, as long as you agree to pay for it and then
actually do pay for it. Keeping your property is the most important part
of the Attorney's job. Will bankruptcy stop garnishment, foreclosure, creditor calls, repossessions, or lawsuits?
Hiring an attorney can stop creditor
calls immediately, even before your bankruptcy has been filed. By federal law, they are not allowed to contact you in any way
after they are properly notified that you are represented by an attorney. Once your bankruptcy is filed,
garnishments, foreclosures and repossessions also stop. We may even be able to get back your money that
was garnished before bankruptcy or your car that was repossessed before bankruptcy. But time is crucial
in cases like this-do not wait, but call our
office today if you need this kind of relief. What do I do if I have a lawsuit filed against me?
Contact your attorney immediately. Do not ever ignore
a summons for a lawsuit; if you do your rights will not be protected and your paycheck could be garnished
very soon. How much debt do I have to have to file bankruptcy?
There is not a minimum amount. If you cannot afford
to pay your debt, bankruptcy may be right for you. However, each case is different and we can advise
you of other options besides bankruptcy. What types of bankruptcy are available to me?
Chapter 7 or Chapter 13 are the two options for most consumer debtors. Both chapters usually allow you
to discharge your unsecured debts, like credit cards and medical bills. A Chapter 7 bankruptcy is very
quick, usually about 4 months, and is most common for someone who does not have much property or possessions.
However, the full attorney fee must be paid before you can file a Chapter 7 and not everyone qualifies
under the law for this chapter. A Chapter 13 bankruptcy is designed for debtors that may have a home and
other property they want to protect and a source of income that will allow at least a minimum payment
of $100 monthly. Only the filing fee and other related costs, usually $300-$400, must be paid before
filing a Chapter 13 and the payment lasts for a minimum of 3 years. Call our offices to find out which
chapter is right for you.
Which type of bankruptcy is best for me?
Generally speaking, there are restrictions on who can file a Chapter 7 bankruptcy, while most people are
eligible to file a Chapter 13 bankruptcy. If you have a home or a car, and are behind on your payments,
or if you owe taxes or child support, a Chapter 13 bankruptcy will allow you to catch up on those payments
during the term of the bankruptcy and allow some other benefits not available under Chapter 7. However,
if your debt is all unsecured debt (credit cards and medical bills, for example), if your income and living
expenses each month leave you with less than $100, if your income is below the median income for Arkansas,
and if you can pay all of the fees up front, a Chapter 7 bankruptcy may work for you. Call our office for
a free first visit to determine which Chapter is best for you. We will also evaluate your case and recommend
whether you need to file bankruptcy at all, or whether there are other options to help you.
I heard the bankruptcy laws changed in October, 2005. How will that affect me?
The biggest change is the requirement to take the "means test", which means your income is compared to
the median income in Arkansas. If you make more than the median, you do not qualify to file a Chapter
7 bankruptcy and are required to file a Chapter 13 with a 5 year plan. You will be required to take a consumer
credit counseling course before you can file. We can help you with this requirement, which usually means
a 30 minute phone call to evaluate other options open to you. If you have filed bankruptcy in the past
8 years, the law may affect parts of your bankruptcy now. There are many other complex changes in the law.
Please call our office for a free first visit so we can tell you if there are any other ways the laws affect
you.
How long will it take before you can file my bankruptcy after I decide that bankruptcy is right for me?
We work very quickly. If you are able to pay the court and other fees and provide us with all the required
paperwork, we can file within 24-48 hours after you first hire us to help you.
What documents will I need?
The bankruptcy laws are very complex. It is helpful if you bring the following to your first free visit
at our office: copies of your bank statements for the last 6 months; copies of all your paycheck stubs
for the last 6 months; copies of all your bills, lawsuits, etc; copies of your last 4 years tax returns;
and copies of your home and auto insurance declaration pages. In addition, there may be other documents
that we need that are unique to every case. If you do not have all of these documents, though, do not let
it stop you from calling our office. We can help you get many documents that you are having trouble locating.
Do I have to pay all of my creditors back in full if I file a Chapter 13?
No. In most cases, your payment to the Trustee each month will pay for your secured debt (like your car
or your furniture), the back taxes or child support you may owe, your attorney fee and your trustee fee.
Your unsecured debts (like credit cards and medical bills) are dischargeable debts. Secured debts are also
dischargeable if you don't want to keep the property that secures it. These are complex issues which require
analysis for each individual. Call our office for a free first visit where we can tell you how your case
would be handled.
How long will my bankruptcy show on my credit record?
Generally we tell clients to expect the bankruptcy to be reported to the credit bureaus for 7 to 10 years,
although you can begin to rebuild your credit as soon as your bankruptcy is discharged. Many banks now
offer "secured" credit cards where you deposit a certain amount of money that will guarantee the credit
card. By starting small and paying for your charges each month, you will begin rebuilding your credit history.
Many debtors are able to rebuild their credit and qualify for a home loan in as little as 2 years,
and some in possibly even 1 year. Call our office to schedule your free first visit so we can help you get
a clean start.
Even though I am married, can I file by myself?
Yes. If all of the debt is individual and in your name alone, your spouse does not have to file bankruptcy
with you. If that is the case, you may be able to preserve your spouse's credit history. However, the trustee
uses household income and expenses when evaluating a budget so, even if your spouse is not filing,
you will have to include all of the income and all of the expenses for everyone who lives in your home.
Can my boss fire me for filing bankruptcy?
No. Federal law prohibits any employer from discriminating against you because you filed bankruptcy.
Do I have to use a lawyer to file bankruptcy?
No. You do not need to use a lawyer to file either Chapter 7 or Chapter 13. However, we advise that you use
the services of an experienced bankruptcy attorney as bankruptcy is complex. A bankruptcy lawyer is worth
the cost. You can save the cost of legal fees many times over through the peace of mind, release of stress
and actual money saved by following the advice of your bankruptcy attorney.
For more information or a free first visit please contact Jack and Holly Martin, Attorneys at
Law in Northwest Arkansas.
In Fayetteville: 444-8844
In Springdale: 756-9222
In Rogers: 636-6400
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