Bankruptcy FAQs To Know Before Your Free Consultation With Us
Begin your road to debt relief by reading through these frequently asked questions. Drawn from our attorney’s 40 years of experience in bankruptcy law and debt consolidation, the questions are designed to prepare you for your consultation.
For more specific questions, reach out to Ted Stuckenschneider PC to arrange a free consultation where we can discuss your case in detail.
Clients’ Common Concerns
Q: Do I have to put my house or car in debtor’s court/Chapter 13?
A: All debts must be disclosed. What will be paid by you directly or through the court can only be determined after a completely free and confidential analysis.
Q: Will I lose my home or car in bankruptcy?
A: All secured debts, including your home and car, must be paid or the creditor will be allowed to repossess them.
In Chapter 7 bankruptcy, you must continue the payments yourself and they must be current and insured. Filing Chapter 13 on the other hand, car payments are usually already part of the plan to reduce the interest rate and therefore the payment, which allows you to keep your home and car for less money. This happens even if you are behind when you file, so long as you complete all the payments through the plan.
In Chapter 13, we usually put any payments you are behind on your house in the plan and catch them up, allowing you to keep the house as long as you continue to make all future payments yourself in a timely manner. In Chapter 7, however, to keep your house and car, you cannot have too much equity in them. See the next question on exemptions.
Q: What are the exemptions in bankruptcy in Alabama?
A: The exemptions in bankruptcy in Alabama are set by state law and are many. During the consultation, we will analyze this for you after getting a complete list of everything you own, but here are a few: All retirement plans are exempt. You and your spouse (if joint debtors) are entitled to $15,500 each in equity in your home and $7,500 each in personal property, but how this may affect you can only be determined after a complete analysis.
Do not attempt to transfer assets out of your name. This will only make matters worse.
Q: A relative or friend signed with me on one of my debts. Will it hurt their credit?
A: No, although a disclosure that you and your debt are in a court proceeding may be shown on their report. This usually does not by itself cause someone to be denied additional credit. Each case is different and can be better determined after a completely risk-free and confidential analysis with us.
Q: Can I leave a few debts out of my case?
A: The accuracy of our advice will depend on your complete, confidential disclosure to us of all facts pertaining to your case, i.e., all income, all expenses and all debts.
Pursuant to the law and court rules, all of your debts must be disclosed. After your free and confidential analysis, all of your options will be explained, and then you can decide which option to take.
Q: How does bankruptcy hurt my credit? Can I buy a house, etc.?
A: Both a Chapter 7 liquidation and a Chapter 13 debtor’s court payment plan stay on your credit for 10 years. However, most individuals are able to re-establish credit within 18 to 24 months, including the ability to buy a home or refinance.
Q: What about tax debts to the IRS or the state?
A: Yes, they can be paid without further interest or penalty in a Chapter 13 debtor’s court payment plan, and some can be discharged outright in a Chapter 7 liquidation bankruptcy. This is a complicated question that can best be answered, and details are available, after the complete free and confidential analysis.
Q: Are there any alternatives to bankruptcy?
A: Yes, during the consultation we will talk about all your alternatives, including debt consolidation plans and credit counseling.
Still Have Questions?
We can address any additional questions you may have at our Birmingham office during your free initial consultation with us. To schedule a time that works best for you, call 205-419-2636 or send us an email today.