COMMONLY ASKED QUESTIONS
Question: What
"Chapter" of Bankruptcy do you handle?
Answer: I
only handle Chapter 7 cases. This is where your unsecured
debts (credit cards, medical bills, etc.) are completely
eliminated.
Other
types of cases (such as Chapter 13s) all involve a type of
re-payment plan. Not only is it hard to make payments to
the court (in an amount the court feels you can afford,
but most people feel they can't), but, statistically, there is a
very high failure rate. For example, over a 5 year
re-payment plan, there is often an unexpected drop in income or
unexpected personal expense. The case would then be
dismissed. This is why I do not like to handle these
cases: I want to be able to assure you of a successful case.
Question:
What is this "New Law" I've heard about?
Answer: In 2005, a big amendment was made to
Bankruptcy Law. It is not really a new law, but a change
to the old law. Because it was big, and is confusing to
many (most experts agree it was poorly written) many rumors
exist about it. In fact, they are so widespread, there are
organizations trying to get accurate information to people
through television Public Service Announcements, and other ways
to let people know that bankruptcy is still a viable option for
most people.
Most
of the rumors involve some variation on the theme that
bankruptcy help is no longer available, is much harder to get,
or involves some type of repayment plan. This is a
national problem of mis-information, and some of it comes from
creditors themselves. I've had clients tell me that a
creditor told them they couldn't file bankruptcy anymore, or
that they would have to do a repayment plan. this is just
untrue in most cases.
The
main change is just additional paperwork requirements and more
red tape, as is true whenever a law is changed. Also,
certain automatic income levels come into play. For
example, if a household with two people in it makes under about
$45,000 a year, or a household with four people in it makes
under $60,000 a year, then they easily qualify for Chapter 7,
eliminating credit card debts, medical bills, etc., and
restoring good credit. Even if someone is over these
income levels, they may still qualify.
Question: What
counties do you handle?
Answer: We are in a very large federal district
for bankruptcy (there is not a court in every county as in other
types of law). That's why I have many clients who reside
in Marion, Citrus, Sumter, and Lake counties.
I can also file your case if you live in: Putnam, Volusia,
Baker, Bradford, Clay, Columbia, Duval, Flagler, Hamilton,
Nassau, St. Johns, Suwannee, Union, Orange, Osceola, and
Seminole counties.
Question: What does it
cost?
Answer: It's hard to give an exact figure for the
attorney's fees because I try to take each person's situation
into account individually. Most attorney's charger
somewhere between $1,000 and $2,000 for the fees, but the fess
can vary by hundreds of dollars either way.
After analyzing your case, and talking to you, I will do my very
best to make the whole process, including advising you and
answering questions, as well as filing your case, affordable for
you.
Also, you can pay your fees and
costs all at once or a little at a time, at least $50 every
month or so. Some clients pay all the fees at once if they
are able to; others may take a couple of years to pay the fees.
I represent you the whole time, and I can usually stall
creditors for quite a while. However, I urge you to try to
keep paying towards your fees. Although there is usually a
little advance warning, I wouldn't want you to be in a position
where a creditor is preparing to garnish wages, bank accounts,
or put a lien on your home, and you aren't at least close to
filing your case. But, it depends on your individual
situation, and I realize that.
Question: What are the steps?
Answer:
First, call my office and set up your Free Initial
Consultation. This consultation can be in person or by
phone. Some of my clients just want to talk a little about
bankruptcy first before they decide to come into the office, or
they have trouble leaving home due to medical conditions, or
because they may live where it would be a long drive to my
office in Ocala.
Second, if you and I decide bankruptcy is right for you,
I would give or send you additional papers explaining the
process in more detail. You would then make at least a
small retainer payment.
Third, we would Stop Any Creditor Harassment.
If it is already happening, or will be soon, you can use the
"creditor line" (352) 351-3463 to give out to your creditors and
tell them to call us instead of you. This really does work
quite well. I don't want your creditors bothering you on
the phone. However, some clients think that, once the
phone calls have stopped, they have nothing to worry about (but
several months or a year later a creditor may start legal
proceedings, so we need to stay on track).
Fourth, after the fees and court costs are paid, I would
send you a questionnaire to fill out so I can prepare your final
papers. I will then send them to you to look over, sign,
and provide any additional information that may be needed.
Once I receive the papers back, I will make corrections, if
necessary. There is a requirement (pretty much of a
formality) that you obtain a "certificate" from a credit
counseling agency that they have given you advice (it can be
online or over the phone, and I can assist you with this
procedure). This is fairly new, and we will know more
about this procedure later.
Fifth, you will be asked to call to go over a last minute
checklist of questions to make sure that there is no
information missing and the papers are complete and accurate.
Sixth, your papers (called a "Petition") will be filed
very quickly after the last minute checklist of questions to
make sure everything is accurate. This is called the
"filing date" and it is really the only day that matters
legally. Everything starts fresh for you after that date,
though there are some follow up steps.
Seventh, the court will schedule a short meeting with the
bankruptcy trustee it has assigned to your case (basically to
check your identification and the information on the petition)
for about 4-6 weeks after it receives the petition.
This should be the only time you'll need to be personally
present, and it's very informal-it's not in a court room or in
front of a Judge. The rest I can usually handle for
you.
Finally, your "Discharge of Debts" is entered approximately
sixty days after your meeting. But you will not need to go
in front of a Judge for this. I will take care of that
part for you.
Question: How long does it take?
Answer: Once
we've gotten to the point of filing your petition, the whole
process should be over within about 3 or 4 months.
Question: Can one spouse file alone?
Answer: Yes, and it
won't affect the other spouse, or their assets, income, or
credit report at all. In fact, it's fairly common,
especially if a couple was recently married and one spouse had a
lot of debts from before the marriage.
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. What happens is, once they take back the
car, they sell it for
about 50% less than what is owed on it. Then they can go after you for that
deficiency. The same thing happens with a home that has been foreclosed.
Most of the time it sells for less than what is owed on it and they would
try and collect, from you, the difference. All of this can be discharged in
a Chapter 7 bankruptcy.
Question: What if a creditor continues to call me?
Answer: Usually, once you tell them to call me, they
will never call you again.
However, sometimes the creditor will call you back or try to get you into a
conversation. The best thing I have found to do is to use what I cal the
"Broken Record Technique." This is where you just repeat the same phrase
over and over again. For example, whatever the creditor says, you say, "I'm
sorry, but you need to call my attorney." Or, "I'm sorry, but my attorney
told me not to talk to anyone." This is usually not necessary, but if it
is, once you say it a few times, the creditor gets the message that they are
not getting anywhere trying to get you into a conversation or making idle
threats and they will give up.
Question: What if I
receive Legal papers?
Answer: The first thing you would probably want to do is
call my office and read the title to me or the paralegal I've
assigned to assist me with your case. Or you may want to
send us a copy of those papers.
In general, however, if you receive a "Summons" or a "Summons
and Notice of Pre-Trial Conference," I will advise you to ignore
it. If you owe the money anyway, there's usually no point
in trying to defend the case. Let them win. It will
eliminated in the bankruptcy.
But if you get something called a "Subpoena" or other paper
ordering you to do something, I will advise you of how to handle
it, and how urgent it may be getting to file your petition.
Question: Can I still
be sued once I have retained you?
Answer: Yes. I
can stop them from calling you, and usually stall them for quite
a while. But, eventually, if your petition has not been
filed yet, they will sue you, which can result in liens, wage
garnishments, etc. This is why I urge clients to continue
paying towards their fees, even if it takes a long time.
We usually have some advance notice before any of these things
happen, but it's nice if you are at least close to being able
file your petition.
Question: Do I need to list my house and/or my vehicle even if I want to keep them?
Answer: Yes. Any type of secured debt must be listed.
You can indicate that you
are keeping that debt, though. We need to show the court that you do not
own that house or car free and clear, and that you have to make payments on
it. If you do intend to keep the collateral, you must keep your payments
current. If you do not intend to keep the collateral, you can stop paying
on it whenever you are ready. The item will be repossessed or foreclosed
on some time after that, but you will not be responsible for the difference
in what the creditor sold the collateral for and what was owed on it once
the bankruptcy is filed.
Question: Do I need to list all of my credit cards, small doctor bill, etc.?
Answer: You are supposed to list all of your debts. At
the meeting, the Trustee
(the lawyer who represents the creditors) may even ask if you've listed all
your debts and is expecting you to say, "Yes." Many people leave off small
debts to friends, relatives, dentists, small credit cards that are current,
etc. You should realize that you can list a debt and still pay on it if you
choose. Please be aware that if you don't list a credit card, it is
possible that the creditor may find out about the bankruptcy anyway by doing
a random credit check - perhaps thinking of raising your credit limit-and
once in awhile I have heard of them canceling your credit card even though
you didn't list it and have been keeping your payments current. Usually, gas
and department store credit cards allow you to keep their cards, probably
because they want to keep you shopping at their store. Also, please note
that we can amend your bankruptcy petition to add a debt before your case is
discharged for a $100.00 fee. We cannot amend your bankruptcy after your
case is closed or discharged - which is about 3-4 months after it is filed.
Question: How long does it usually take to re-establish credit?
Answer: You will probably find you can get credit right
away, but at high
interest rates. However, most people find it only takes about 2 years to
get good credit again, with good quality interest rates.
Actually, if everything else is fine (steady job, etc.) it only
takes about 6 months for a low interest car loan and two 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: Not at all. I wish I could magically make
you feel okay about this, but everyone is different. I can
give you some statistics and information.
There are almost twice as many bankruptcies filed each year in
this country as divorces. This means you probably know a
number of people who have filed, they just haven't told you.
I've filed cases for people from all walks of life. From
people on very limited Social Security Income, or earning
minimum wage to Doctors, Lawyers, and Bankers.
Many people never even considered that they may be in this
position or that they would be "one of those people who file
bankruptcy." But, "those people" are just like you and me.
Anyone can experience a sudden drop in income, unexpected
medical problems, etc.
Many people find it interesting to know of some famous people
who have filed bankruptcy. Here are some examples:
Companies: K-Mart, Winn-Dixie, Service Merchandise, Regal
Cinemas, and recently many airlines.
Patriots and Politicians: Thomas Jefferson, Abraham
Lincoln, and former Texas Governor John Connaly.
Celebrities: Larry King, Kim Bassinger, Wayne Newton,
Burt Reynolds, and M.C. Hammer.
Sports Stars: Lawrence Taylor, Mike Tyson, Johnny Unitas,
and Leon Spinks.
Others: Francis Ford Coppola, Walt Disney, Henry
Ford, Conrad Hilton, Bowie Kuhn, Charles Schwab, Donald Trump,
and Sam Walton.
And this is just a very small list of
well-known people who have had financial setback, but in many
cases, bounced back after bankruptcy.
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