Information Center

Correct, reliable and up-to-date information is essential if you are thinking about filing for bankruptcy.

Tax Debts

Tax debts including income tax, sales tax, use tax, and payroll taxes are generally not discharged. You also understand that all or part of your federal and state income tax refunds (not yet received but owed) are part of your bankruptcy estate and must be disclosed and exempted or they may be taken by the bankruptcy trustee to pay your creditors some or all of what you owe them.

The House

Gas, electric, telephone, satellite, cable and other utility bills are generally dischargeable, but future service after the bankruptcy with a company listed in your bankruptcy may be affected.

Utility Bills

You are declaring bankruptcy on your house. You can keep your house provided you maintain the payments and do not have a large amount of equity in it. After the bankruptcy has been complete if you obtain your credit report, it will reflect that you have discharged that debt in your bankruptcy. In order to keep your house you are obligated to maintain the payments.

Student Loans

Student loans are not generally dischargeable through bankruptcy. If you have student loans understand you will bear full responsibility for paying them.

Divorce Debts

Child support, alimony and maintenance, and are not dischargeable through bankruptcy. You understand that you bear full responsibility for making payment arrangements on your domestic support orders after bankruptcy.

Co-Signer Liability

Co-signers, joint applicants and joint cardholders are not protected by the bankruptcy. Creditors can collect from these people. Continuing to make regular payments to the creditor can usually prevent collection efforts against your co-debtors.

Bankruptcy Estate

If tax refunds or other property of the bankruptcy estate is transferred without permission of the court, then a discharge can be revoked or the right to receive a future bankruptcy discharge might be taken away.

If the trustee files a motion for turnover or adversary proceeding to revoke your discharge for failure to provide documents or assets then you will be responsible for additional fees or your attorney will withdraw from your case.

Non-Filing Spouse

If you are married and filing individually, your attorney will not represent your spouse. Only your eligible debts will be discharged. Your spouse will still be responsible for joint-debts.

Recent Usage, Fraud

Certain types of debts may survive bankruptcy and may still have to be paid after the bankruptcy: recent cash advances and credit card usage; debts arising from fraud; debts where you may have given false financial statements to obtain credit; NSF checks; and/or debts that are not disclosed on the bankruptcy paperwork. Additionally, credit cards used within 90 days of filing bankruptcy can also be non-dischargeable. The same applies to cash advances and or loans.

Undisclosed Creditors

Any debt not disclosed on a bankruptcy petition may not be discharged, and you may be liable for payment of that debt after filing.

Undisclosed Property

All assets must be disclosed (whatever the value) if you file bankruptcy, including but not limited to, property deeded and/or titled in my name whether in your possession or not.

Undisclosed Income

All household income for the six (6) months prior to the filing of a bankruptcy case from all sources, including, wages, government assistance, business income, bonuses, court proceedings that result in a judgment in my favor, IRA distributions, etc.. And any future known changes to household income must be disclosed through your bankruptcy petition and schedules.

Reaffirmation Agreements

A reaffirmation is a promise to pay a debt that pre-dated the filing of a bankruptcy. In order to perform this promise a reaffirmation agreement must be signed by both parties and filed with the court. These agreements must be voluntary, must not place too heavy a burden on you or your family, and must be in your best interest.

Signing a reaffirmation agreement is binding and the loan will survive bankruptcy. If you sign a reaffirmation agreement, and are late on your payments, then your lender may seek to collect on a deficiency (the difference between the balance on a loan and what a vehicle is sold for at auction).

You will not be able to file another Chapter 7 bankruptcy to discharge the loan for 8 years (although you may be able to qualify to file a Chapter 13 bankruptcy depending on the specific circumstances). You should also make sure that your payments are up-to-date prior to submitting the reaffirmation agreement. In the event you sign the agreement and change your mind, you should consult your attorney about the possibility of filing a rescission with the Court, which may be possible within a very short time period.

On occasion, some lenders will allow you to retain a vehicle and continue making payments without signing a reaffirmation agreement. If you take this approach, then the lender may have the right to repossess your car even if the payments are current. You won't be responsible for a deficiency balance if they exercise this right and no reaffirmation agreement is signed. There is a possibility that a lender will let you retain the car if the payments are current, but there is some risk that despite being current on payments a lender will repossess the car without notice to you.

You should carefully consider whether you intend to keep your car and sign a reaffirmation agreement, but you may also choose to surrender the car in which case you would not be responsible for any arrears or deficiency.

Governmental Files or Debts

Debts owed to a governmental unit or government fines, (such as parking tickets, building code violations, debts for overpayment of public aid and unemployment) may not be discharged.

You Are Not Alone

Over 1,412,838 people file bankruptcy each year in the United States.

You probably know several individuals who have filed for bankruptcy, they just didn't tell you. A bankruptcy filing can be a fairly well-kept secret, notwithstanding that it is a matter of public record. It is unlike a divorce filing, where one party usually moves out of the marital house. A household in bankruptcy can look pretty much the same before bankruptcy as it does after bankruptcy.