How long does the process take to file for bankruptcy?

How Debts Are Discharged In Bankruptcy

A common misconception is that when debts are discharged during a bankruptcy, the tax payer picks up the burden.  This is simply not true – in the process of a bankruptcy, the creditors are the ones who take a financial hit.  They do this by often getting pennies on the dollar amount of what they originally loaned, so it’s never a pleasant process for them.  

When a court declares your debts discharged, it essentially becomes illegal for creditors to contact you about the debt.  However, not all debts are discharged and this is why it is important for you to contact someone who can advise you regarding bankruptcy law and which part of your debt is most likely to be discharged.  Every bankruptcy is different and bankruptcy laws vary widely, state by state.  A bankruptcy attorney will be able to counsel you regarding the laws that are particular to your state and give you a good indicator if bankruptcy is really your best option. 

Starting fresh is an important part of beginning on a road to financial freedom and recovery.  A court will be able to look at your situation – past, present, and future – and determine your ability to reasonably pay off your debt.  If the court finds that some debts should be discharged, they will focus on the high-interest ones and determine if you will pay them back partially, or not at all.  Since each bankruptcy is different, it is impossible to determine exactly which debts will be cleared by the courts, but a bankruptcy attorney will be able to give you a good estimate of what might happen in your particular situation.  

One of my top ten favorite bankruptcy cases

The last step of the bankruptcy process is when you receive your discharge notice. Both you and your attorney receive this notice and it means that the court has wiped out your debt and you are now able to start over, debt free. I recently received a discharge notice for Miguel C. that caught my eye. His was an especially rewarding case. He had been a law enforcement officer for ten years and had partial ownership in a business. He earned over 80k a year but had over 50k in credit card debt and a growing family that made meeting his monthly obligations impossible. He had been told time and again by other attorneys that he did not qualify for a chapter 7 bankruptcy due to his income and business ownership. NOT TRUE. The “means test” which determines whether a person qualifies for a chapter 7 bankruptcy is based on both income and expenses. It takes a qualified, skilled bankruptcy attorney to determine whether a person qualifies for a chapter 7. Thanks to us, Mike was able to:

• Keep his primary home

• Get out from under an investment property that was dragging him down

• Keep his 2008 Toyota SUV

• Enjoy a better relationship with his family and loved ones

• Concentrate more at work without distracting collection calls or financial pressures.

Every week I cringe when I talk or meet a perspective client who “heard from a friend”, or “read online” about what a bankruptcy can or cannot do, what happens post bankruptcy or how someone should act prior to filing bankruptcy. Shouldn’t you get your information from a qualified bankruptcy attorney expert? To schedule your free initial consultation call us at 305-663-3281or email john@bankruptcylawclinic.net.