Your Most Frequently Asked Questions
- Can I buy a house or a car while I am in bankruptcy?
It is possible to purchase a house or a car while you are in bankruptcy. If you plan on financing the property, you will need to get court permission. Permission can be obtained several ways depending on the type of bankruptcy you are in and where you stand in the bankruptcy process.
If you are a Chapter 7 Debtor, you have two options. You can either wait until your case is discharged, or you can make the purchase once the 341 meeting has been held and concluded.
If you are a chapter 13 Debtor, in order to incur new debt your case must be confirmed. If your confirmation hearing has been concluded our office will need to file a motion with the Courts for approval. You will need to consult with your attorney or paralegal to determine if there are any additional attorney fees involved. In order to have the motion filed, you must provide all finance documents, along with updated income and expenses. We will need to show the Courts that you will be able to afford this purchase. Once all items requested have been received your motion will be filed with the Courts.
If you are a chapter 13 Debtor in the Phoenix Division and your case is confirmed, you can request permission from the Trustee. Please provide our office with the completed Incur Debt Packet. Once we receive the completed packet along with all requested documents, we will forward it to the Trustee. The Trustee will then review your request and provide you with their response in writing. However, not all Chapter 13 Trustee offices allow this procedure.
- Who must attend the 341 Meeting of Creditor's?
Anyone who was on the bankruptcy filing. So, the debtor (w/ spouse in joint case) must be present to be questioned under oath by the trustee and by creditors.
- Why did I receive a Proof of Claim from a creditor in the mail?
If you receive a blank Proof of Claim form in the mail from the court, please disregard. You do not need to complete the form. A Proof of Claim is a signed statement describing a creditor's claim. Once the creditor has completed a Proof of Claim on your debt, we provide a copy to you so that you can approve the amount being listed or object to the amount shown.
- How much does it cost to file?
Every case is different; therefore, every fee is different. What I can promise you is that, together, we will come up with something that you can afford. I take this process very seriously. When it comes to stopping a foreclosure to save your home, stopping a garnishment or repossession, I will not let you leave my office over money. My main goal is for you to get the relief that you need to get back on your feet again.
- Can I keep any of my Possessions?
Yes, in almost all cases in Arizona you will be able to keep your possessions. This includes your house, cars, retirement accounts, furniture, electronics, jewelry, tools, pets, etc… I will do everything that I can do to make sure that you keep all of your belongings. One of my main goals as your attorney is to come up with a plan to keep all of your possessions.
- Will my creditors leave me alone once I file for bankruptcy?
YES! Once you file for bankruptcy, your creditors can no longer call you, email you, send you letters or contact you in any way. This includes you, your friends and your family members. All collection attempts will stop immediately. As your bankruptcy attorney, creditors will be required by law to go through me from this point forward. If creditors continue this harassment, you will have legal claim against them. This will give me the opportunity to sue any creditor that does this to you in federal bankruptcy court.
- Will my creditors leave me alone just by hiring you as my bankruptcy attorney but before I actually get my case filed?
Absolutely! Once you hire me, I will give you a letter of representation and creditor number to provide all your creditors as reference. Once a creditor knows that you are represented by an attorney they can no longer contact you. They are required, by law, to go through me.
- Does my spouse have to file with me or can I file a bankruptcy on my own?
Arizona is a community property state, so we will discuss any debts you incurred prior to marriage and those you incurred while married. You and your spouse can file alone, separately or together. Just one of you can file as well. You do NOT both have to file. Once you come in I will advise you on which way would be best for you considering your situation. Many times it is not necessary for both you and your spouse to file and, in addition, there are many reasons why you may not want to file together.
- Will everyone know that I filed bankruptcy?
Absolutely not. It is not like the old days where all the bankruptcy filings are published in the local newspaper. Today, cases are filed online and stored in a Federal database. To access that database you have to have a username and password. Rarely does the general public have this access. In the past, I have not had a problem with other people finding out that my clients have filed bankruptcy. You can be assured I take all the necessary steps to protect your privacy to the fullest extent
- Will I be able to rent an apartment if I file bankruptcy?
Yes, I have helped hundreds of people through this process and I have never come across a case where a client was not able to secure an apartment or rental house due to their bankruptcy. Sometimes it can be a little more difficult to find that perfect place, but it is definitely not something to worry a great deal about and we will write your landlord to explain why you are a great choice for that new rental.
- Will I be able to buy a house or buy a car after my bankruptcy?
Yes. Plenty of banks, credit unions and car dealerships offer rates to people who are rebuilding their credit. When it comes to purchasing a home, you may have to wait 2 years after a Chapter 7 filing. During that you should begin to reestablish your credit which will enhance your ability to qualify for a home at that 2 year mark. You may even get a good interest rate at that time, if you follow our aftercare program.
- How do I know if I should file personal bankruptcy?
Are being you sued? Or are you about to be sued? If you are being sued or your creditors have indicated they intend to sue you, and you own a home, contact one of our knowledgeable representatives immediately about filing a bankruptcy. A bankruptcy will stop a lawsuit and can prevent your creditors from placing a lien on your home or garnishing your hard-earned income.
Is your home being foreclosed or is your car about to be repossessed? If you are being sued, and you own a home, contact one of our knowledgeable representatives immediately about filing a bankruptcy. A bankruptcy will stop a lawsuit and can prevent your creditors from placing a lien on your home or garnishing your hard-earned income.
Do credit cards or medical bills have you so deep in debt that it is hard for you to save for the future? If you are only paying the minimum payment on the credit card bills from month to month it can take you 10 to 20 years to pay off a $10,000 debt.
Do you really want to be in the same financial situation in twenty years? Chapter 7 bankruptcy can provide you with a fresh start that you are entitled to under the law and get you out of debt NOW.
- How do I choose a personal bankruptcy attorney?
When considering filing a personal bankruptcy, you want to be advised by experienced and knowledgeable attorneys that know all of the "ins and outs" of bankruptcy law. If you own a home or car or have other assets that you are trying to protect, it is more important than ever for you to find a qualified attorney. Attorneys, who know a little bit about a lot of different areas of law, but not a lot about bankruptcy, are not going to be able to represent you like we can. At Thompson Law Firm we spend almost all of our time on bankruptcy and getting people just like you out of debt.
- Can I get rid of student loans or tax debts?
Any bankruptcy attorney must have a sophisticated understanding of bankruptcy law to deal with student loan and tax debts. In October 2005, a new law was signed into effect that disqualified all student loans from discharge. Thompson Law Firm can still help you obtain relief from your student loan debts through the use of Chapter 13 bankruptcy. Under Chapter 13 bankruptcy, our attorneys can consolidate your student loan debt and arrange an interest free repayment plan.
For tax debts, you must have filed timely, truthful tax returns for the past three years. Of course, these are general rules and you should speak with a Thompson Law Firm representative who will perform a detailed analysis of these issues.
- Can I get credit after filing personal bankruptcy?
Bankruptcy can be reported to your credit report for up to 10 years; however, you can begin to reestablish your credit right away. Bankruptcy eliminates most, if not all of your debts. Once your debts are eliminated your debt-to-income ratio is reduced; therefore, potentially improving your ability to borrow money in the future. Some financial institutions actively solicit business from people who have filed. Many lenders have programs that provide for post-bankruptcy borrows to obtain home financing within a year or two after a discharge. Many of our clients even receive solicitations for unsecured credit cards almost immediately upon receiving their discharge. Our attorneys can help you sort through your post-bankruptcy credit options to prevent you from getting back into the credit card "trap".
- Will my credit card debt, medical bills, payday loans, old repossessions, and signature loans go away and be discharged once I complete my bankruptcy?
Yes, these debts and possibly many others will all be gone once we get your bankruptcy discharged!
- Will I have to go to Court if I file for bankruptcy?
In most cases you do not ever have to go to Court. But you will have to speak with a Trustee or a paralegal at the Trustee's office. This is a simple process known as a Meeting of Creditors. The funny thing is though, is that your creditors rarely show up to this meeting. The Trustee will ask you a few simple questions about your bankruptcy and then you'll be able to go home.
- Will bankruptcy help me with my IRS debt?
Yes, in most situations we can pay the IRS back through your bankruptcy at 0% interest, reduce your balance owed, and come up with a very beneficial payment plan. Also, the bankruptcy will stop the threat of liens and levies being put on your property and or your
bank accounts.
- Will my ex-spouse be notified of my bankruptcy?
If your ex-spouse is still on a shared note (car/home) or credit card statement then yes they will receive notification.
- What documents do I take to my Meeting of Creditors?
In the District of Arizona you are required to have your:
Driver's License or Passport and Social Security Card – originals only, or a letter from the government entity that a new document has been ordered. These are mandatory items and the Trustee will usually not begin the meeting without them.
- Will Bankruptcy Ruin My Credit?
If you had perfect credit, which very few people do prior to filing, it would affect your credit for a short time. Since most people have substantially damaged their credit prior to fling, in many cases it actually helps to raise your Credit Score and helps you start rebuilding your credit.
- I need to File Bankruptcy but My Car is Getting Repossessed, What Can I Do?
We are not able to protect your vehicle until your bankruptcy case is filed. If your Chapter 7 case fees are paid in full, we could file your case immediately to protect the vehicle. Otherwise, we can change your bankruptcy case to a Chapter 13, if you are eligible. The money that you have already paid towards your Chapter 7 case can go towards the filing fee for the Chapter 13 case and we can file immediately to protect your vehicle.
- My Spouse Is Not Filing Bankruptcy, Why Do I need to Provide Their Paychecks?
You must provide all the income information for the household. We live in a community property state which means that your spouse's income is also your income. Although your spouse is not filing you must still provide their income because they contribute to the household.
- Can I Leave Some Creditors Off My Bankruptcy?
You cannot pick and choose which debts to list in your bankruptcy petition. You must list all of your debts, including credit cards and debts you owe to friends and family members. Intentionally leaving a debt off your bankruptcy petition is against the law. When you sign a bankruptcy petition, you are certifying under penalty of perjury that all of your assets and debts are listed. During the meeting of the creditors, you will also be asked under oath if all of your debts have been listed on the petition. Even though you have to list a particular debt, there is nothing in the law that prevents you from voluntarily repaying the debt after it has been discharged.
- Can I Keep My House and Car In Bankruptcy?
Yes you can, but we need to get you in for a FREE consultation so the attorneys can look at your financial situation and determine what options you have.
- I Co-Signed on a Car for a Friend or Relative and Can't Afford the Car, What Now?
You can surrender your liability on the vehicle in the bankruptcy and you will no longer be responsible for the debt and the creditor cannot collect this debt. If the other party can afford the vehicle, they can keep the car with no interruption to their use.
- I Have Multiple Rental Properties and Cars, Can I Keep Them?
Generally, yes. This depends on which type of bankruptcy that you choose to file. This can be determined after your FREE consultation with us.
- I'm Married but Want to File Alone, Will This Affect My Spouse?
You may file separate. However, if you have joint debt it can affect your spouse. Please talk to us so we can help you weigh the benefits and risks.
- Will My Creditors Come To My Meeting of Creditors?
Typically, your creditors do not attend this meeting. Governmental agencies, such as the Internal Revenue Service or the Attorney General, will appear if money is owed or tax returns have not yet been filed. Occasionally your creditors may appear to ask limited questions.
- What If I Forgot to List a Creditor and They Are Calling Me?
You can add a debt to your bankruptcy as long as the debt occurred prior to your filing date. To add a new creditor to your bankruptcy case our office must have the company name, mailing address, account number, date the debt was incurred, and amount of debt owed. After paying an amendment fee of $41.00, we will be able to include the new creditor to your bankruptcy.
- What Is Bankruptcy Going To Cost?
We do not have any set fees at Thompson Law Firm. It would be unfair for us to go over your information over the phone or through our website and quote you a price. You need to come in and let the attorney's look over your situation, see how much work is to be done, and they will set a price with you at that time. The consultation is FREE and we will be able to shed some light on your situation. If you need a payment plan, Thompson Law Firm will work with you. We have never had anyone leave our offices because of our prices.
- We Can't Afford Our Mortgage Payment, What Can Be Done?
If you cannot make these payments, contact us for a FREE consultation and we can help you with either a Chapter 7 or Chapter 13 Bankruptcy.
