Chapter 7 Frequently Asked Questions


Below you will find many of the most commonly asked questions regarding a Chapter 7 Bankruptcy.  Click each question below to view the answer.  All questions and answers below are general in nature and do not constitute legal advice from the Law Office James C. Herring & Associates.  If after reading the frequently asked questions below, your questions are not answered, please contact us by clicking by calling (254) 399-9977 or Email us for more Info.  Also, check out the Chapter 13 FAQ.


Table of Contents

General/Before Filing

  1. What is the difference between a chapter 13 and chapter 7 bankruptcy?
  2. Who contacts my creditors?
  3. What debts do I have to continue paying for?
  4. Can I be denied?
  5. Can I keep some of my debts?
  6. Who will know about it?
  7. Will filing affect my job?
  8. Where can I find out how much I owe the IRS or get past Tax Returns?
  9. Will the bankruptcy appear on my credit report? If so when will it appear?

After Filing

  1. Why do I need to put my questions in writing?
  2. What is a 341 meeting?
  3. When is the 341 meeting?
  4. Where is the 341 meeting?
  5. What documents do I need to bring to the 341 meeting?
  6. Who will be at the 341 meeting?
  7. What will happen at the 341 meeting?
  8. Can I reschedule my 341 meeting?
  9. What is a discharge?
  10. How long will it take to get my discharge?
  11. Someone else cosigned with me on one of my debts, how will this affect him?
  12. Can I still lose my house or car?
  13. What if I failed to list a creditor?
  14. What is reaffirming?
  15. What is the "automatic stay" and why is it important?
  16. My Creditors are still calling me and sending me bills, what should I do?

Rebuilding/Reestablishing Credit

  1. How fast can I start to rebuild my credit?
  2. How can I rebuild my credit?
  3. How long will it be until I can get a new house or car?
  4. How long will this bankruptcy stay on my credit report?

 


What is the difference between a chapter 13 and chapter 7 bankruptcy?

A Chapter 7 bankruptcy discharges all dischargeable debts.  These often include credit card debt, old tax debts, and other unsecured debts.  A Chapter 13 bankruptcy allows the debtor to reorganize their debts.  In a Chapter 13 bankruptcy, a repayment plan is established and payments are made to the Trustee's office for 36 to 60 months.  The advantage of a Chapter 7 bankruptcy is that it allows debtors to wipe the slate clean and start over.

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Who contacts my creditors?

After we file your petition, we notice (contact) all of your creditors.  

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What debts do I have to continue paying for?

In addition to your normal expenses, such as food, insurance and utilities, in a Chapter 7 bankruptcy, you must continue paying all of your secured creditors.  These often include your house, car, and furniture.  In other words, if you what to keep your possessions, you must continue to pay for them.  If you are surrendering the secured debt then you do not have to continue paying for it.  If you are unsure about which creditors you need to continue paying for, please contact you attorney. 

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Can I be denied?

There are certain situations in which a person would not be allowed to receive a discharge in a Chapter 7 Bankruptcy.  There are certain criteria for filing a Chapter 7 bankruptcy.  These include but are not limited to having received a Chapter 7 discharge within the last six years, or recently receiving a Chapter 13 discharge where the unsecured creditors received less than 70% of the amount owed.  Additionally, debts that were fraudulently incurred would not be discharged and failure to make full disclosure of assets and/or debts could cause a debtor to have the trustee or creditor file an objection to discharge against the debtor.

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Can I keep some of my debts?

Yes.  This is called reaffirming a debt, see below.

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Who will know about it?

Though filing a bankruptcy is public information, unless you are a public figure, it is unlikely that anyone except your creditors and those that you tell will know.  Currently in McLennan county, bankruptcies are not listed on the internet, newspaper, or television. 

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Where can I find out how much I owe the IRS or get past tax returns?

If you are missing needed tax returns you can obtain IRS transcripts for little or no charge.  These can be used instead of tax returns.  Transcripts can be obtained by mail by calling the IRS at (800) 829-1040.  This will take 10-14 days to receive these documents by mail.

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Will filing affect my job?

No. Law prohibits governmental units and private companies from discriminating against you because you filed a bankruptcy petition or because you failed to pay a dischargeable debt.

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What is a 341 meeting?

The 341 is a meeting the meeting of creditors, though few ever actually show.  This meeting allows creditors to object to the bankruptcy.  If they do attend this meeting, your attorney will assist you in dealing with them. 

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When is the 341 meeting?

Your 341 meeting is typically held about 30-50 days after your case is filed.   You will get a notice of the date and time of the 341 meeting from the Trustee's office by mail.

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Where is the 341 meeting?

U.S. Bankruptcy Court
800 Franklin, Ste. 175
Waco, TX 76701
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What documents do I need to bring to the 341 meeting?

If you have provided us with all of the information and documentation that we requested, you will not need to bring anything to the 341 meeting.  Do remember to bring a drivers license or other form of identification.

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Who will be at the 341 meeting?

In addition to yourself, and spouse if co-filing, an attorney from our office and a Trustee will be present.  Creditors are also welcome at this meeting, but few ever show.

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What will happen at the 341 meeting?

You will show up at St. Charles Place and wait for you name to be called.  Normally, during this time your attorney will briefly go over the process with you and answer any questions that you have. When your name is called, you will be asked a few simple questions about your debts and income by your attorney and possibly a officer of the Trustee's office.  The process normally takes 10-15 minutes once your name has been called.

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Can I reschedule my 341 meeting?

No. However if it is an emergency, then the 341 can be rescheduled one time as long as you give the attorney a written reason why you  can not attend. This written notice must be given to our office before your scheduled 341 meeting.  The reason will be given to the Trustee when your first hearing is called. 

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What is a discharge?

A discharge is when all of your unsecured (dischargeable) debts are wiped away. 

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How long will it take to get my discharge?

You will receive notice of your discharge between 90-120 days after the filing of you case.  This is usually about two months after your 341 meeting.

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Can I still lose my house or car?

Yes, in a Chapter 7 bankruptcy, you must continue paying all of you secured creditors.  These often include your house, car, and furniture.  In other words, if you what to keep your possessions, you must continue to pay for them.  If you are surrendering the secured debt then you do not have to continue paying for it.  If you are unsure about which creditors you need to continue paying for, please contact you attorney.   If you fail to make payments on your secured debts, the creditors will ask the court to lift the automatic stay and allow them peruse you.

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What if I failed to list a creditor?

If you fail to list a creditor, you must give us the name and address of that creditor and we will amend the matrix.   The court does charge $20 to add creditors, so be prepared to pay this expense when you give the creditor information to us.

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What is reaffirming?

Reaffirming is the process by which you voluntarily agree to repay, to become personally liable for, some or all of a debt.  A typical example is a car.  You wish to keep the car you are currently driving, and the creditor wants you to continue paying, so you sign a new contract, or reaffirm, the vehicle (debt). 

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Why do I need to put my questions in writing?

A Chapter 7 bankruptcy is a very complicated process and generally attorneys do not like to give legal advice over the phone.  Having your question in writing allows us to refer to it when we answer it.  This enables us to be sure to answer it correctly and in full.  It also protects the attorney and yourself by having a copy of the question and the answer in case of a misunderstanding.  To email us a question, click here.

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What is the "automatic stay" and why is it important?

When you file a bankruptcy, The bankruptcy court gives you the protection of the automatic stay.  This is a mechanism that does not allow any creditor to pursue any of the debts that you owe them or seize your property, (there are a few exceptions such as criminal activities).  The automatic stay makes it so you can go through this process with out being harassed by creditors.  If we have filed your case and you are still being harassed (being sent bills, receiving phone calls, etc.), write down who (the person, company, time, etc.), is contacting you and bring that information to our office. 

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My creditors are still calling me and sending me bills, what should I do?

If we have filed your case and you are still being harassed ( being sent bills, receiving phone calls, etc.), write down who (the person, company, time, etc.), is contacting you and bring that information to our office.  Your creditors may be in violation of the automatic stay.

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How fast can I start to rebuild my credit?

You can start to rebuild your credit immediately.  Most important is to make sure that all of your creditors, such as your house and car, are being paid on time and in full.  Any other payment that you are making on a regular basis can also be reported to credit bureaus.  You may need to ask them to report positive information to the credit bureaus.  Some apartments and utilities will even report payments to the credit bureaus.  If you have retained a credit card make sure that it is paid in full every month as well.  In many cases, a secured credit card is the best and the easiest way to start rebuilding your credit.

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How can I rebuild my credit?

You can start to rebuild your credit immediately.  Most important is to make sure that all of your creditors, such as your house and car, are being paid on time and in full.  Any other payment that you are making on a regular basis can also be reported to credit bureaus.  You may need to ask them to report positive information to the credit bureaus.  Some apartments and utilities will even report payments to the credit bureaus.  If you have a retained a credit card make sure that it is paid in full every month as well.  In many cases, a secured credit card is the best and the easiest way to start rebuilding your credit.

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How long will it be until I can get a new house or car?

Generally, you can qualify for a new house or car within a year or so.  This depends on several things, such as current income, debt levels, payment history, down payments, etc.

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Will the bankruptcy appear on my credit report? If so when will it appear?

Yes, it will appear on your credit report. When it appears depends on the credit companies and credit bureaus.  Typically, it appears on your credit report, in some manner, between one and three months after you file.

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Someone else cosigned with me on one of my debts, how will this affect him? 

If the debt is a dischargeable (credit card, repossession, etc.), then you will not have to pay it. Your co-signer will become primarily responsible for this debt.  Though the creditor may not peruse the co-signer immediately, they may in the future.  A special automatic stay protects certain co-signers during the bankruptcy proceeding.

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How long will this bankruptcy stay on my credit report?

A Chapter 7 bankruptcy can stay on your credit report for up to ten years.

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Not Certified by the Texas Board of Legal Specialization.

The information you obtain on this site is not legal advice, nor is it intended to be legal advice.  You should consult an attorney for advice regarding your individual situation. 

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