Bankruptcy Questions / FAQ

Click on one of the questions below to get a brief answer to that question.

• What is bankruptcy?
   
• Is bankruptcy right for me?
   
• What happens when I file for bankruptcy?
   
• How long does filing bankruptcy take?
   
• What happens to my credit once I file for bankruptcy?
   
• Will filing bankruptcy stop harassing phone calls from creditors?
   
• Will filing for bankruptcy prevent foreclosure on my house?
   
• How can I afford to pay attorney's fees and costs?
   

Have more questions? Send us an e-mail.

What is bankruptcy?

Bankruptcy is a federal law that provides individuals and businesses the ability to either liquidate or reorganize their debts, provided that the individual or business meets the criteria set forth in the Bankruptcy Code.  One main purpose of the bankruptcy laws is to allow an individual to address his or her debts, and to get a "FRESH START" from financial problems.

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Is bankruptcy right for me?

Generally, if your monthly income is less than your monthly expenses, you may be able to file for Chapter 7 bankruptcy. Alternatively, a Chapter 13 bankruptcy is filed for an individual with a regular source of income to help reorganize debts, and make payments to a trustee who will then pay creditors. 

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What happens when I file for bankruptcy?

You file a bankruptcy petition, which contains schedules listing debts, assets, expenses, and income. An individual is assigned to administer your case, and this person is called a trustee. About a month after the filing, there is a meeting of creditors where the trustee reviews your case and asks basic questions regarding your petition. In a chapter 13 case the debtor files a plan in which he or she proposes a repayment schedule for his or her debts. At the meeting of creditors, the trustee will review the proposed plan.

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How long does filing bankruptcy take?

In most cases, Chapter 7 bankruptcies will be completed within five months; Chapter 13 payment plans last three to five years.  

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What happens to my credit once I file for bankruptcy?

If you are considering bankruptcy, your credit rating is likely to be already damaged. Your bankruptcy will likely remain on your credit report for seven years. However, you can take steps to rebuild and improve your credit rating.

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Will filing bankruptcy stop harassing phone calls from creditors?

Yes, when you file bankruptcy, an automatic stay goes into effect that will stop creditor harassment. The automatic stay prohibits virtually all creditors from taking action to contact you, or attempting to collect debts you owe.

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Will filing for bankruptcy prevent foreclosure on my house?

It may be possible to save your home from foreclosure by filing a Chapter 13 bankruptcy petition. Generally, you will not lose your home if your Chapter 13 plan provides for payment of the current monthly mortgage payments, plus payments of the arrears spread over the life of the plan.

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How can I afford to pay attorney's fees and costs?

Gross & Patterson, LLC WANTS TO HELP YOU GET A FRESH START, so we may be able to set up a payment plan to suit your needs.

If you need skilled bankruptcy advice, contact Gross & Patterson, LLC today to schedule a FREE initial consultation. Telephone consultations are also available.

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