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Filing for Bankruptcy in Massachusetts?

Frequently Asked Questions

What is Bankruptcy?

Bankruptcy is a legal proceeding that is designed to help individuals who cannot pay his or her bills, and offers the opportunity for individuals to get a fresh financial start in life. All bankruptcy cases are processed in federal court and the right to file is provided by federal law. The main benefit of filing for bankruptcy is to immediately stop creditors from collecting debts from you, until resolution is granted according to the law.

Will bankruptcy clear out all my debts?

Yes, however, there are some exceptions. Here are some of the areas bankruptcy will NOT typically eliminate:

•Money owed for alimony or child support, and some taxes
•Debts which are not listed when filing for bankruptcy such as loans you obtained giving false information to a creditor
•Debts resulting from “willful and malicious” harm;
•Most student loans (court may rule to eliminate under certain circumstances)
•Liens and other Mortgages not included in the petition

Also, keep in mind that all dischargeable debts and unsecured debts are wiped out, after your case is discharged.

Will bankruptcy filing stop my creditors?

Technically the answer is YES. However, the Court will require some time to notify your creditors via mail. You will probably still have some calls in the interim, however, you will have a case # to provide your creditors, if they call. Most of the time, this will take care of the phone calls.

Is it too late for bankruptcy if I have already been sued or am being garnished?

No. A bankruptcy will stop any creditor collection efforts. You will be immediately protected, no matter what stage the collections are in.

Where Will My Case Get Filed?

Your case is filed in the District where you have resided.

Is Chapter 13 Bankruptcy for me?

Chapter 13 bankruptcy (reorganization) is best under the following circumstances:

•If you own your home and are fearful that you may lose it due to financial distress.
•Are behind on you debts, however, you feel that you can catch up if given some time.
•Have valuable property that is not exempt from bankruptcy, however, your income can afford you to pay creditors over a period of time.
•Have sufficient income during Chapter-13, to pay for necessary expenses, while keeping up with your debt obligations.

Is Chapter 7 Bankruptcy for me?

Chapter 7 bankruptcy is the best approach if you have NO regular sources of income. It works by reducing or wiping out most of your debts. You can then make a fresh start without having to worry about having to pay your debts. Once you file for Chapter 7 bankruptcy, the bankruptcy court assigns a trustee who works as an intermediary. He oversees everything and checks out if the bankruptcy plan is going as planned.

What does it cost to file for bankruptcy?

Hines Law Offices offers $995 bankruptcy and convenient payment plans for those who quality. Prior to filing your bankruptcy case, all fees must be paid in advance. $995 represents our attorney fee for the filing of your Chapter 7 case. In situations where additional legal services are required, this fee may increase. You are also responsible for paying the court filing fees of approximately $350, plus the credit report fee, along with two financial management courses that are required by the State of Massachusetts.

Is it possible to keep some credit cards, out of the bankruptcy, if they are still current?

No, all your debts must be listed. If you did not list them, the creditor (credit card company), would most likely cancel them upon filing.

What is bankruptcy not designed to do?

First, bankruptcy is not the answer to all financial situations. And careful consideration must be taken into account to ensure bankruptcy is the right choice. Typically bankruptcy can not:

•Cannot Eliminate secured creditors from liens they may have on your property (collateral for the loan). An example includes home mortgages and vehicle loans. In most cases, individuals cannot keep the collateral unless you continue to pay the debt.
•Cannot discharge child support, alimony, and other debts related to divorce, criminal fines, most student loans, and some taxes.
•Cannot protect cosigners on your loans. In these circumstances the cosigner may still have to repay all or part of the loan.

Am I required to go to court?

You will need to appear at a meeting of creditors hearing at the bankruptcy court. The trustee, an attorney appointed to administer the bankruptcy case, will hold the meeting. The meeting will take place, based on the district that your case is filed.

Will filing for bankruptcy affect my credit?

Unfortunately, if an individual is late on paying their bills, most likely their credit is already compromised. However, filing for bankruptcy in most cases will not make matters any worse. filing for bankruptcy can appear on your credit report for 10 years. On the positive side, bankruptcy will wipe out your old debts, and put you in a position to keep current, which in-turn will greatly improve your future credit record.

How can bankruptcy help me?

There are many advantages offered by bankruptcy including;

•Elimination of your legal obligation to pay your debts. Otherwise known as a “discharge” of debts, which has been created by the courts to give individuals a fresh start.
•Halt foreclosure on your house and allow individuals the opportunity to get current on missed payments.
•Prevention of repossessions of property or a car. In most cases, the creditor can return the property even after repossession.
•Stop garnishment, creditor debt collection harassment.
•Prevent termination of your utilities or restore them.
•Enables the individual to challenge the claims of creditors, to ensure that you are only paying what you owe.

ARE YOU CONSIDERING BANKRUPTCY?

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What Happens After Bankruptcy?

Open a savings or checking account, and begin saving money.

It is critical, to pay all your bills on time, as this will build a history of on-time payments.

Stay clear from payday loans and other high interest bearing financial companies.

Before making purchases, make sure you can afford it! Learn to live within you means. Try and limit purchases to what is required vs what you would like.

Sign up for a credit monitoring service and review your credit report regularly, we suggest every 3-6 months. Make sure that your credit report is accurate. There are three major credit agencies; Equifax, Experian and TransUnion. You should sign up with one of these companies.

Be sure to look at the information we provided regarding “Fair Debt Collection Practices Act.”

Apply for a credit card that you can use for regular purchases for gas and stores you frequent. As you make regular payments on time, eventually, you will become more attractive to banks and other lenders.

There are plenty of automobile dealerships and mortgage lenders who are “friendly” to individuals who have filed in the past.

You are allowed to submit a letter to the credit reporting agencies, explaining your situation that lead to filing for bankruptcy. We suggest that you do this as it will help your overall credit worthiness.

Any debts left over from your bankruptcy, must be paid on time. This is very important, if you want to reestablish your credit.

It goes without saying, that you should get rid of any debt that you can as fast as possible. Remember, debt with high interest rates, are most likely a large reason you filed in the first place. If you can’t afford to make minimum monthly payments, it will be very difficult to pay off that debt.

Additional Helpful Information

Please contact us if you are considering bankruptcy protection. We will be happy to determine the best course of action.

Official Bankruptcy forms from US Courts
http://www.uscourts.gov/services-forms/bankruptcy

Massachusetts Bankruptcy Court Website
http://www.mab.uscourts.gov/mab/

Bankruptcy Information
https://www.pacer.gov/

American Bankruptcy Institute
http://www.abi.org/

National Association of Consumer Bankruptcy Attorneys
www.nacba.org

National Association of Bankruptcy Trustees
www.nabt.com