INTRODUCTION

The following information is for clients who have retained the attorney to file a Chapter 7 bankruptcy. The information contained herein is specific to cases filed through this office in the Middle District of Florida, Orlando Division.

The following provides basic information about bankruptcy and the course of events you will experience in your bankruptcy case. If you have a question about your bankruptcy case or procedures, please review this printed information before calling my office. In order to keep my fees as low as reasonably possible, and below average in the community, I cannot personally respond to every question from every client. All reasonable questions will be answered as quickly as possible. If you cannot find the answer to your question here, you may e-mail your questions to my Legal Assistant who will obtain my assistance as appropriate.

BASIC TERMINOLOGY

Unsecured debts include personal loans and credit cards issued by banks, such as Visa, MasterCard, American Express, or Discover, and other credit cards used to purchase consumable items such as clothing, food, vacations, etc.

Secured debts include those debts where the creditor has a security interest in your property to guarantee payment. Examples of secured debts include mortgages, car loan, loans from finance companies (usually secured by household items), furniture, computers or electronics. If you purchased store goods using a store credit card, such as a card from Sears, Circuit City, Rooms to Go, Best Buy, etc., the store probably has a security interest in certain items purchased, which makes the store a secured creditor.

Reaffirmation. Reaffirmation means that you agree to continue to pay the debt. However, even if you want to reaffirm a secured or unsecured debt, credit privileges will be suspended upon the filing of your bankruptcy. Many creditors will reopen your account after you have signed a reaffirmation agreement. Some creditors do not provide reaffirmation agreements and will not reopen your account. If you intend to reaffirm your mortgage or auto loan, you should continue to send regular monthly payments to the creditor, even if you don’t receive a statement from them.

PROCEDURE BEFORE FILING

Handling Creditors Before Filing: If a creditor calls you after your initial appointment and payment of your retainer, tell the creditor that you have retained an attorney to file bankruptcy and give them my name and number (407-444-0404). My office will respond to your creditors for a reasonable time as long as you are making progress toward filing your bankruptcy petition and payment of your costs and fees.

After your initial consultation with the attorney do not use any credit cards you intend to discharge. If you have substantial charges or cash advances within approximately six (6) months preceding filing bankruptcy the creditor may file an adversary complaint alleging that you incurred recent charges with fraudulent intent and without the intent to repay these debts. You will incur additional attorneys fees to deal with adversary complaints as stated in the retainer agreement.

General Guidelines In Completing Your Bankruptcy Questionnaire. 

Bankruptcy Questionnaire. The bankruptcy schedules that the attorney will prepare for you are based upon the information you provide on the Bankruptcy Questionnaire which you received at your intial meeting with the attorney. All information you furnish regarding your creditors must be complete and accurate. It is your responsibility to assure the accuracy of that information when you deliver the completed Questionnaire to my office. Your creditors who do not receive notice of your bankruptcy because of an incorrect address or account number might not be discharged (the elimination of the debt) and you would still owe them money.

Furnish Information in Writing. All information must be furnished in writing on the Bankruptcy Questionnaire. If additional sheets are needed, make copies of the sheets in the Questionnaire. I will not accept information in any other form such as bills, statements, letters you have received from the creditor, or phone messages you leave with my legal assistant or on my voice mail. You must provide all answers to the Questionnaire in writing because information given over the phone is too often misunderstood. After you have submitted your completed Bankruptcy Questionnaire, you will receive a letter or e-mail from my office if additional information is required. You may submit your response to those questions by fax (407-333-2040) or to my Legal Assistant by e-mail. Please do not fax or e-mail the Bankruptcy Questionnaire.

Collection Agencies. If a creditor has turned your debt over to a collection agency or attorney (creditor’s representative), list the creditor’s address and the address of the collection agency or the creditor’s attorney.

List All Creditors. You are required to list all creditors, including your mortgage company and auto loan or lease company. You may not pick and choose the creditors you list on your bankruptcy schedules. You may, however, decide to reaffirm debts to certain creditors.

Consider Getting a Credit Report. If you are not sure you know all your creditors you may want to get a report from a credit reporting agency. If you have recently been denied credit, you are entitled to a free credit report from the reporting agency. Instructions for obtaining this report should be on the letter you received denying credit. You can obtain your credit report from Equifax online at http://www.equifax.com, by mail at Equifax Credit Information Services, Inc., PO Box 740241, Atlanta, GA 30374, or by telephone at 1-800-685-1111. You can obtain a copy of your credit report from TransUnion online at http://www.transunion.com, or mail at TransUnion, LLC, Consumer Disclosure Center, PO Box 1000, Chester, PA 19022, or by telephone at 1-800-888-4213. TransUnion accepts telephone requests only if you have been denied credit within the last 60 days and TransUnion was the reporting agency.

Bankruptcy Picture. Bankruptcy takes a picture of your financial situation on the date your case is filed. Because you are never sure of the exact filing date you will always have to provide your best estimate of items such as credit card balances, cash on hand, and checking or savings account balances.

Copies. If you want a copy of your Questionnaire, your Petition, or any other bankruptcy document, you should make a copy before returning the documents to my office to avoid copying charges. There is an additional fee if we have to retrieve your file from off-site storage to provide you copies after your case is closed.

YOUR DEBTS

You must provide complete information about your debts, providing the creditor’s name and address, the approximate date the loan was incurred or the date the credit card account was opened, the approximate amount owed, the account number, any co-debtors (anyone other than yourself, or yourself and spouse if filing jointly), the purpose of the loan, and whose responsibility (self, husband, wife, or joint). On secured debts, it is also important to indicate whether or not you want to reaffirm the debt.

Secured Debts. During the case you will have to choose to either reaffirm secured debts or surrender the secured items to the creditor. You are entitled to keep any secured property as long as you continue to pay the loan for that property. If, however, you elect to surrender secured property, the secured creditor may not thereafter recover any money from you personally on account of that debt.

Your Residence. You can keep your personal residence as long as the mortgage is current. Do not stop making mortgage payments unless you are planning on surrendering the secured property. Equity in your homestead is exempt property and is protected in bankruptcy by the Florida Constitution. Any equity in real property other than your homestead may be claimed by the Trustee even if the mortgage is current.

Surrender of Secured Property. If you choose to surrender your house or other real property to the mortgage lender, the lender will likely foreclose the mortgage, in which event you will receive foreclosure papers from civil court. You do not have to respond to the foreclosure papers as long as you intend to surrender your property to the lender because the lender cannot recover from you personally after the foreclosure sale. You have not retained me to represent you in any foreclosure proceedings in civil court, and my office cannot offer advice about foreclosure papers or proceedings without you incurring additional legal fees. However, it is important to keep me informed about foreclosure proceedings before you file your Petition.

Foreclosures. If a foreclosure has been filed against you and you intend to keep the property, you must keep my office advised of deadlines such as the sale of the property. If a foreclosure is pending, it is important to have your bankruptcy petition filed as soon as possible in order to stop the foreclosure, at least temporarily, until you can bring the mortgage current. A Chapter 7 bankruptcy will not permanently stop foreclosure actions.

Personal property. In the case of secured store credit cards used to purchase personal property, you may choose to surrender all or some items to the store, or you may reaffirm the debt as to all or only as to particular items. You do not have to reaffirm the entire card balance to keep just the property you purchased.

Reaffirmation Agreements. The law requires you to execute a reaffirmation agreement for personal property you want to keep. These reaffirmation agreements will either be presented to you at your meeting with the Trustee, or they will be sent to me and forwarded to you with a standard cover letter. Signing a reaffirmation agreement means that you will be personally liable to pay the debts after your bankruptcy is over. If you do not pay these reaffirmed loans the creditor can sue you and the bankruptcy will not protect you. If you sign a reaffirmation agreement and change your mind you may rescind the agreement for 60 days after signing or until the bankruptcy case is discharged, whichever first occurs. If you reaffirm a secured debt, and fail to make the payments when due, the creditor may repossess the property after the stay is lifted. You do not have to sign a reaffirmation agreement to your mortgage lender.

SPECIFIC ISSUES IN COMPLETING YOUR QUESTIONNAIRE

Real and Personal Property. Under the Florida Constitution you are allowed to exempt and keep in bankruptcy $1,000 of personal property ($2,000 for a joint Petition). All personal property listed in the Questionnaire counts toward the $1,000 per person exemption.

Value of Personal Property. The bankruptcy court uses current market values in the valuation of personal property for the purposes of this exemption limit. Don’t put your cost of the property or what the property is worth to you. Therefore, when you complete your Questionnaire you should value your property based on what you could expect to receive for the property at a public market such as a garage sale or flea market sale.

Verification of Values. Only you know the condition and value of your property. Therefore, I will rely on values you submit on your Questionnaire, and I will not change your values. The Trustee has the authority to send an appraiser to your house to value your property. If the Trustee orders a property appraisal, the appraiser will contact you to make an appointment to come to your house.

Property Over Exemption Limits. If your non-exempt property exceeds the $1,000 per person limit your bankruptcy will not be rejected, but the Trustee may ask you to surrender some property or to buy back the amount over the exemption limit. Most Trustees will give you a few months to pay the non-exempt value of your property.

Income and Expenses. The bankruptcy petition includes a statement of your monthly income and expenses. However, if your income and expense statements reported through the Questionnaire show a monthly net income sufficient to repay your creditors over time, the Trustee may question the filing of a Chapter 7 liquidation and may require that you convert your case to a Chapter 13 repayment plan.

Student Loans. Student loans are not discharged unless you can show that your loan payments impose “undue hardship.” In order to eliminate your student loans under the “undue hardship exception” you must file a separate motion with the bankruptcy court, and you must appear before the bankruptcy judge with proof of your hardship. As a practical matter, it is very difficult to demonstrate undue hardship unless you are physically unable to work. Filing this motion would constitute additional legal work, and you would have to pay additional legal fees in advance.

Federal Taxes. Income taxes may be discharged if they were assessed more than 240 days and due more than three (3) years (including extensions) prior to the filing of your Chapter 7 Petition. Additionally, the tax return must have been received by the IRS more than two (2) years prior to the bankruptcy filing date. If the IRS extended your filing or payment date, or if it made a later tax assessment, your taxes may not be discharged. If your attorney does not practice tax law, and if you have not retained your attorney to assist you with tax issues, you should contact the IRS, your tax advisor, or a tax attorney.

Credit Union Loans. Many credit unions will make you close your checking and savings accounts if you discharge a loan or credit card debt from the same credit union. In such event, you will have to open new checking and savings accounts at a different financial institution. Additionally, your credit union loan may be secured by funds in your credit union accounts, and in such event, the credit union can seize money in these accounts to pay the loan. You should examine your loan documents or talk to your credit union if you are unsure whether or not your credit union loan is secured by money in the accounts.

Tax Refunds. Income tax refunds are assets, and you should list on your Questionnaire a refund you expect to receive from a prior year’s tax withholding. If you are due a tax refund on your filing date, or if you have possession of a refund previously received, you should not spend the refund until the trustee indicates they are not making a claim on the refund.

Automobiles

Value of Automobile. Any equity you have in a car is considered personal property and may be counted toward your $1,000 overall personal property exemption allowance (see b. below). If you own your car free and clear, the entire car value is equity. If you have a car loan, only the excess of the car’s trade-in value over the current loan balance is considered equity. Most people with car loans owe more than their car is worth (“upside down”), in which case, they have no equity in their car. To determine the value of cars, most Trustees rely on NADA values and apply the average of the wholesale and retail value. You may want to obtain your own appraisal of the car’s value if you believe it is worth less than NADA book value. I will rely upon the car value you provide in your Questionnaire when I prepare your petition. If you are unsure of your car’s value, you can obtain a value at http://www.nada.com or http://www.kbb.com.

Additional Exemption for Automobile: Florida Statutes 222.25 gives you a $1,000 extra exemption for a car in addition to your $1,000 personal property exemption. If married, you are allowed $1,000 on each car, up to two cars.

What Happens If You Have Car Equity Which Is Not Exempt? If you have equity in your car which is not covered by the $1,000 car exemption or by the $1,000 personal property exemption, the Trustee may seek to seize the equity so that he can distribute this non-exempt equity to your creditors. The Trustee may ask that you either surrender the car so that it can be sold by the Trustee or that you purchase the amount of the car equity from the Trustee, in which case you will be giving the Trustee cash in place of your car equity. Trustees are not required to offer you a payment plan to repurchase your equity, although most Trustees may allow a few months to buy back equity.

Vehicle Lease. If you lease a car you do not list the car as your personal property. In Chapter 7 you may turn in the car and discharge the debt to the lessor, or you may continue to pay the lease and reaffirm the debt. Be sure to list your car lease in the Questionnaire under Executory Contracts and list the leasing company as an unsecured creditor.

Separated Spouses Filing Jointly: If you and your spouse are separated and filing jointly, each spouse should complete separate questionnaire sections for Schedule A and B (real and personal property) and Schedule J (expenses). Only one copy of the questionnaire is provided, so make the necessary copies before you begin filling out the forms.

AFTER FILING THE PETITION

Information About Your Case. If you want information about your case, including your case number, meeting date with the trustee, discharge date etc., you should call VCIS. VCIS stands for Voice Case Information System and when supplied with either social security, employer identification number or debtor name a search can be accomplished. This service will give you the following information if case has been filed: when it was filed, the judge assigned, debtor's attorney and phone number, trustee assigned and phone number, 341 meeting of creditors date and time, and chapter filed. The number for the Middle District of Florida is 1-866-879-1286 (access for courts in Jacksonville, Tampa, and Orlando). Please call this service before contacting my office.

Notice of Meeting of Creditors. When the petition is filed, a combined Order Scheduling a Meeting of Creditors and Fixing Filing Dates for Claims, Complaints Objecting to Discharge, and Complaints Seeking Exception to Discharge will be sent by the Court to all creditors, to you, and to our office. This is commonly referred to as the “341 Notice” or the “Creditor Meeting Notice.” You should receive this Notice from the bankruptcy court approximately ten (10) days after your petition is filed. (Note: If you provide us an incorrect creditor address, the creditor will not receive this important Notice, and the Court will not enter a discharge against that creditor.) You should also receive a letter from my office with directions to the Court and any special instructions concerning the meeting.

Meeting with Trustee. The creditors meeting is held in a meeting room, not the court room, and the federal bankruptcy judge is prohibited by law from being there. Typically this meeting will last about five minutes.

Please note: You must provide a photo i.d. and a copy of their social security card at the time of the creditor’s meeting. If you fail to bring these items with you, the meeting cannot go forward and you will incur additional attorneys fees for the continued hearing.

Location: The bankruptcy court is located in the SouthTrust Building at 135 W. Central Avenue. Take I-4 west to Colonial Drive (SR 50). When you get to the traffic light at the end of exit ramp, proceed straight across Colonial which will put you on Hughey going south. Proceed on Hughey about 2 miles: I-4 will be on your left, and you will pass the Centroplex (Bob Carr Auditorium, T.D. Waterhouse Center) and Marriott Hotel on your right. You will notice a metered parking area under I-4 and the Federal Building on your right. Park in the metered parking area. Walk under I-4 to the east side. You will be about 2 blocks north of Church Street Station. The South Trust building will be to your east (a 10 story office building adjacent to I-4 at 135 West Central Boulevard). The Creditors Meetings are on the 6th floor and the Clerk’s Office is on the 9th floor.

Who attends. You are required to attend the 341 Meeting (if filing jointly, both husband and wife must attend). I will accompany you and represent you at the meeting. As a practical matter very few, if any, unsecured creditors attend. Usually, the only creditors who attend are representatives of stores such as Sears who hold a security interest in items purchased on their store credit cards and some finance companies.

What is a Trustee and What Does He/She Do? The “Bankrupt Estate” consists of all legal and equitable interests you have in property as of the date the case is filed. In Chapter 7 one primary job of the Trustee is to gather all of your non-exempt assets, sell these assets, and distribute the proceeds among all your unsecured creditors. A Trustee is randomly appointed by the Court immediately upon the filing of a Chapter 7 petition. The Trustee is usually a private attorney and is compensated primarily by a percentage of the non-exempt assets he or she is able to collect and distribute to your creditors.

What Happens at the 341 Meeting. I understand that you may be nervous about this meeting, but I assure you that in almost all cases you will find this meeting is not difficult. The Trustee will ask you questions, but (s)he will not interrogate you, cross-examine you, or threaten you. It may help you to anticipate some of the questions you will be asked. Here is a sample of common questions which make up your brief examination:

Have you listed all your assets and debts on your schedules?

Does anybody owe you money?

Do you have any reason to sue anybody?

Are you the current beneficiary of a will or trust?

How did you arrive at the value of your car and other property?

Have you repaid any debts to family within the past year?

Have you sold or transferred any property within the past year?

Do you expect to receive an income tax refund in the future?

Does anyone have property that belongs to you?

Have you owned any cars in your name in the past year?

What if you cannot attend the meeting? Creditors meetings are scheduled by the Trustee based on the Trustee’s schedule. We are not able to request a particular meeting date or time. If you are unable to attend the 341 Meeting you should notify my office in writing at least one week in advance so I can contact the Trustee for a continuance. The attorney charges an additional fee of $175 which should be mailed with your request for a continuance. The Trustee will schedule a “make-up” meeting approximately two weeks after the first date. If you do not attend the second meeting, the Trustee will move to dismiss your case.

Handling Your Creditors After Filing. The Court mails the “341 Notice” to your creditors about one week after the petition is filed.

If a creditor contacts you after you have received the 341 notice, advise them that you have filed bankruptcy, give them your case number, and ask that they no longer contact you as is stated in the 341 Notice.

If you receive any bills after filing, you should mail a copy of the 341 Notice to the creditor with the bill.

If a creditor continues to call you or write to you after you have advised them of your bankruptcy case number and filing date, make a record of the creditor’s contact including, if possible, the name of the person contacting you, and dates and times of contacts. You may want to keep a log of unauthorized creditor contacts after your bankruptcy filing. If you have a written log or other evidence that a particular creditor has contacted you more than four times after notification you may call the attorney's office for assistance. Do not call the attorney if you have received less than four contacts after bankruptcy from a particular creditor or if you do not have substantiating evidence or a written log.

Bankruptcy Procedures after the 341 Meeting.

60-Day Waiting Period. After the 341 Meeting with Creditors, there is a 60-day period during which time creditors can file claims if they believe you have non-exempt assets and money will be disbursed by the Trustee, or creditors may object to being discharged providing they have legal grounds. Grounds for objection to discharge include the debtor’s fraud, student loans, alimony and support obligations etc.

Discharge. Approximately 60 days following the 341 meeting you should receive a copy of a court order that discharges your debts. The discharge order wipes out your debts and liability to creditors in your bankruptcy. Do not expect to receive your discharge immediately after 60 days. Please do not call my office to ask when your discharge will be entered or the status of your case. We get our copy the same time you do. You can call the Bankruptcy Voice Case Information System at (407) 648-6800 for an update on your case.

Copies. It is important You should keep a copy of the discharge order with a copy of your Petition and Schedules because you may need it in the future to get new credit and for other reasons. The entry of a discharge order does not affect a secured creditor’s rights in property which you pledged to repay the secured creditor. The secured creditor can always repossess the property if you do not pay according to your loan agreement. In addition, the discharge order only discharges debts that “are dischargeable.” Therefore, the order does not eliminate non-dischargeable debts, such as student loans, ineligible tax liability, or loans procured by fraud or by abuse of the bankruptcy system.

Closing the Case. Approximately 30 to 45 days after the Discharge, you will receive another notice stating that your case is closed. This means that your bankruptcy case is over.

What if I forgot to list a creditor? You can add a creditor any time prior to the closing of your case so long as you owed money to this creditor prior to the filing of your case. Even after your case is over you can file a motion to reopen the case to add a creditor you forgot to list when you filed. You will be assessed a filing fee ($20) and additional legal fees to add new creditors prior to the case being closed. If your case is closed, it will need to be re-opened and additional legal fees will be charged for that work also.

The Automatic Stay. The automatic stay commences immediately upon the filing of the bankruptcy petition. It acts like a shield between you and your creditors during the bankruptcy. The stay prohibits the commencement or continuation of creditors’ judicial proceedings against you as well as all collection efforts. If you are a defendant in a foreclosure or other civil case and intend to reaffirm the debt to save the property, this office will file a Suggestion of Bankruptcy in the civil case. A Chapter 7 bankruptcy stay does not permanently stop foreclosure actions or other civil suits brought by secured creditors. Secured creditors can get relief from the bankruptcy stay to enforce their security interest against past due accounts by filing a Motion with the Court.

Suggestion of Bankruptcy. It is your responsiblity to provide a copy of any lawsuits you have received with your completed Bankruptcy Questionnaire and the name and address of the Creditor’s attorney. You may call my office after you receive your 341 Notice to confirm that a Suggestion of Bankruptcy has been filed.

Motion for Relief from Stay. In Chapter 7 cases secured creditors typically file a Motion for Relief from the Automatic Stay so that they are able to foreclose on your secured property in the event you do not pay your secured debt in a timely manner. The creditor's attorney may file this Motion even if you intend to reaffirm the secured debt and even if your payments are current because the creditor wants to protect its rights in the event you do default in your payments. The court will usually grant this Motion. The Court’s granting of this motion does not mean that the creditor can take your property. The creditor can take your property only if you do not pay the loan in a timely manner under the terms of your mortgage or loan contract with the creditor, and only after the creditor forecloses its mortgage or lien in state court.

Procedure for Stay Motions. When a secured creditor files a Motion for Relief From Stay the court will set a hearing. Since the court usually grants the Motion, I usually do not attend the hearing, and in many instances I will consent to the granting of the Motion. You do not have to attend the hearing unless you want to contest the Motion, in which case, you should contact me in advance.

Contesting the Motion for Relief from Stay. In the event it is in your best interest to contest this Motion in order to delay a foreclosure, to delay a repossession, or for some other reason, you should contact my office. In that event, my appearance at the hearing and other work in opposition to the Motion for Relief from Stay on your behalf is not included in the bankruptcy fee and additional attorneys fees will be required.

Adversary Cases. If a creditor believes it should not be discharged, it may file, or threaten to file, an Adversary Case against you during the bankruptcy proceeding. The most common grounds for the filing an adversary case is “fraud.” Fraud in this context is not criminal, but it means that you allegedly have abused the bankruptcy process. For example, if you used credit to buy property or take cash advances prior to filing bankruptcy when you were insolvent, did not anticipate repaying the debt, or planned to file bankruptcy, this could be grounds to set aside a discharge of debt for fraud, and the creditor may have a basis to file an adversary case. The majority of Chapter 7 bankruptcies do not involve adversary cases.

The Trustee may also file an adversary case to recover non-exempt property. A Trustee may also file a motion to value property which (s)he believes you have undervalued in order to exempt under your $1,000 personal property exemption. If the Trustee convinces the court to increase the property value, (s)he can then recover any of your property in excess of your exemption limit.

Just because a creditor or the trustee files an adversary case does not mean you did anything wrong. Many creditors file cases as a business strategy in order to pressure debtors to reach a settlement where the debtor will agree to repay part of the debt.

If an adversary case is filed against you, the attorney's office will send you a copy of the Complaint. If the attorney's office receives a letter from a creditor threatening the filing of an adversary case, a copy of the letter will be sent to you. You then have multiple options.

You may believe that the creditor’s allegations are false, and that you have valid explanations for all the contested debt (or the value of your property). In that event, you may refuse to offer any payment to the creditor, wait for the creditor to file an adversary lawsuit, and defend the adversary case in a hearing before the bankruptcy judge. If an adversary Complaint is filed, you will have 20 days to file an Answer to the Complaint or you will be in default and lose. After you file an Answer the court will schedule an evidentiary hearing before the bankruptcy judge where you will have to present testimony and documents in support of your position. Adversary cases are separate legal proceedings and are not part of your bankruptcy filing; therefore, you will have to pay additional legal fees to defend an adversary case.

Secondly, you may try to reach a money settlement with the creditor. Although creditors are not required to accept any settlement, most are willing to negotiate a settlement in the majority of cases. A typical settlement would involve your paying 50 percent to 60 percent of the creditor’s claim in a single payment, or alternatively, 70 percent to 80 percent of the same claim in monthly installments over six to twelve months. These figures are only examples of a negotiated settlement. Your settlement may differ depending on the creditor and the facts of your case. If you want to negotiate a settlement with a creditor, I will transmit your first offer to the creditor with no additional legal fees. If, on the other hand, you want me to negotiate in detail with the creditor on your behalf, or if I transmit multiple offers and counter-offers between you and a creditor, I will charge you for my additional work pursuant to our Retainer Agreement.

The third option is to do nothing in response to this creditor, allow the creditor to file an adversary case, and allow the creditor to have a judgment entered against you. The problem is that property you may acquire in the future may be subject to levy and attachment by the creditor who gets a judgment through the adversary case. In addition, this judgment will be on your credit report for at least seven years.

Transferring Property After Filing. Immediately upon the filing of a bankruptcy petition, a legal “estate” is created by the law which consists of everything you own at the time you filed bankruptcy. This is called the “bankruptcy estate.” In fact, one of the Trustee’s principal duties is to collect the bankruptcy estate (that is, locate and assume jurisdiction over all the property). You should never sell, give away, or transfer any of your real or personal property which is part of your bankruptcy estate either immediately before or after the filing of your petition without checking with me first.

Property You Acquire After Your Case is Filed. Any property you acquire after filing is not part of your bankruptcy estate and is yours to keep. For example, you can retain any money earned from employment after the filing date. As soon as your case is filed, you may purchase a new car, new home, or any other item without permission from the Trustee, provided however, you do not use as a down payment non-exempt property which is part of your bankruptcy. You may also deposit money in your bank accounts after your case is filed.

Cash deposits held by a creditor. Some debtors have checking or savings accounts in banks or credit unions, and they are seeking to discharge loans owed to the same banks or credit unions. A lender may not seize money in a checking account to collect a loan obligation after you have filed bankruptcy unless the loan documents give the lender a security interest in the debtor’s checking or savings accounts. You should read your loan documents or contact your bank or credit union if you are in this situation.

LIFE AFTER BANKRUPTCY

Bankruptcy and Your Credit Rating: Bankruptcy will appear on your credit report for several years. This does not mean you cannot get credit after filing bankruptcy. Most lenders will extend credit within two or three years after filing a bankruptcy case. Many creditors consider you a better credit risk after you filed bankruptcy because you have few other debts, if any, and you are unable to file bankruptcy again for seven years.

Credit Reporting Agencies: Generally, the effect of bankruptcy on your credit is not a bankruptcy issue; it is a banking or credit issue. My staff and I are not particularly knowledgeable or otherwise trained in the handling of credit problems or legal issues pertaining to credit. Most questions concerning reestablishment of credit are best answered by people at banks, credit agencies, or consumer credit services. Many clients report that after filing bankruptcy and receiving their discharge notice that their credit reports still show certain debts as “written off” or “discharged.” Regardless of what is on your credit report no creditor listed in your bankruptcy can collect money from you. If your credit report incorrectly reports certain debts you must resolve errors directly with the credit bureau because no bankruptcy law issues are involved in the incorrect reporting of your credit history. Please do not call the attorney's office about problems you encounter with credit reporting services.

Bankruptcy and Employment. It is illegal for an employer to discriminate against you in any way because you have filed bankruptcy.