Most folks find that the most effective thing to do in that situation (when a creditor calls you shortly after your case was filed) is to answer the phone and tell the person that called that you have filed for bankruptcy protection. Provide them with your case number and the date your case was filed.
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Hiring an attorney. If you hire a bankruptcy attorney, and you inform your creditor of that fact, the creditor will have to call your attorney instead of you. Some bankruptcy attorneys will accept a small down payment—perhaps as little as $100—as an initial retainer so that you can avoid the calls while saving the rest of your attorneys' fees.
Almost all bankruptcy attorneys have specialized software that prepares and files your required bankruptcy paperwork with the court. You'll provide your attorney with all of your financial information, such as income, expense, asset, and debt information.
Should I Tell Creditors I Am Planning To File For Bankruptcy? This question comes up fairly regularly. Is it a good idea, or totally useless, to tell your creditors that you are planning on filing for Bankruptcy, have hired a Bankruptcy lawyer, or you are going to file for Bankruptcy at some point.
In most cases, if you tell a creditor you’re planning to file bankruptcy, the creditor will ask you for your bankruptcy case number, so they can verify that you’ve actually filed a case. Typically, unless you provide a valid case number, collection isn’t likely to stop.
The Automatic Stay (under Bankruptcy Code Section 362) stops creditors in their tracks. The Automatic Stay stops nearly all collection activities. It stops foreclosures. It stops bill collectors from calling you.
The law doesn't require you to notify your creditors before you file bankruptcy, but you may choose to tell some or all of them. Whether notifying your creditors is a good idea depends on the creditor, type of debt, account status, and what you hope to accomplish.
Sometimes It's Best Not to Say Anything Your problem will be solved once you file for bankruptcy. Until then, you'll want to avoid giving the creditor any information that could be used against you later.
No one wants to be sued. Fortunately, filing for bankruptcy stops many legal actions in their tracks, including debt-collection lawsuits.
How Long Does Bankruptcy Take? The bankruptcy process lasts about three to four months from start to finish for Chapter 7 filings. Chapter 13 takes the same amount of time to file, but because you pay down some of your debts over time, the payment plan may last three to five years.
Offer a specific dollar amount that is roughly 30% of your outstanding account balance. The lender will probably counter with a higher percentage or dollar amount. If anything above 50% is suggested, consider trying to settle with a different creditor or simply put the money in savings to help pay future monthly bills.
If the bankruptcy trustee discovers that you have hidden assets, the trustee will file a lawsuit (called an adversary proceeding) in the bankruptcy court. If the court finds you have failed to list or have concealed assets with the intent to hinder, delay or defraud creditors, it will deny your discharge.
To open a bank account that no creditor can touch, a person can (1) use an exempt bank account, (2) establish a bank account in a state that prohibits garnishments, (3) open an offshore bank account, or (4) maintain a wage or government benefits account.
Your bankruptcy trustee can ask for up to two years of bank statements. The trustee will look at your statements to verify your monthly payments to make sure they match the expenses you put on your bankruptcy forms.
After you file for bankruptcy protection, your creditors can't call you, or try to collect payment from you for medical bills, credit card debts, personal loans, unsecured debts, or other types of debt.
As with any Chapter 7 case, a bankruptcy trustee will administer the case by gathering the assets, liquidating them, and using the proceeds to pay creditor claims. The trustee will be a party to any lawsuit you file and will make all the decisions about the litigation on behalf of the bankruptcy estate.
Under Chapter 7, the company stops all operations and goes completely out of business. A trustee is appointed to "liquidate" (sell) the company's assets and the money is used to pay off the debt, which may include debts to creditors and investors. The investors who take the least risk are paid first.
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A Chapter 7 bankruptcy can stay on your credit report for up to 10 years, while a Chapter 13 bankruptcy may remain on your credit report for up to...
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Before you file your bankruptcy petition, get a list of your creditors together. Your bankruptcy petition requires you to list every debt you owe. If you forgot a creditor, you can add it later, but there are big advantages when you get it right the first time.
But, a bankruptcy court case is best handled by a bankruptcy attorney that specializes in bankruptcy procedures. There are several court rules and bankruptcy laws to follow and forms to file. Your first step is to get information together.
You must provide requested documents on your income, assets, debts, and expenses to the trustee. If you forgot a creditor, you can fill out a form to add a creditor . Proof of claims sent by creditors are reviewed by the bankruptcy trustee. The proof of claims is an explanation of the types of debt from the creditor.
Creditors might stop phone calls just to be cautious they’re not violating any debt collection or bankruptcy laws. If creditors contact you and you have a bankruptcy attorney, tell the creditor to call your attorney or the law firm representing you, and give them the phone number and address.
If your wages are already garnished, collection is not going to stop simply because you told a creditor you’re filing bankruptcy.
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In a Chapter 7 case, you’ll probably get your discharge order four to six months after the date you filed your bankruptcy petition.
If you aren't sure about something, contact your attorney for guidance. There are also some things you should avoid doing. If you find you've already done some of the things to avoid, let your attorney know right away. If you try to undo your actions, you could actually make the situation worse.
Your attorney may also ask for copies of bills and collection letters, as well. DO consider opening a new bank account, especially if you do your banking somewhere that you owe money. The bank may close your account when you file bankruptcy, so it's a good idea to already have a new bank account set up when you file.
DO NOT finance a new vehicle just before filing your case. If you do finance a car, it can mean a delay in filing your case. Speak with your attorney prior to doing this. DO NOT use your credit cards or acquire new debt. Unplanned medical debt may be an exception, as you may not have a choice about incurring the debt.
If you continue to receive calls from creditors after you’ve officially filed bankruptcy, it’s time to act. You can’t assume these creditors will stop. They may not be aware or care that you are undergoing bankruptcy.
They will inform the bankruptcy courts and begin necessary legal proceedings. Take creditors to court: If the harassment does not end, you may need to fight against your creditors in court.
Tips to End Collection Calls 1 Explain that you’ve filed for bankruptcy: Notify any creditor that calls that you filed for bankruptcy. Although most creditors will stop contacting you once they discover you filed, a few may persist. 2 Takes notes during every harassing call: Keep a record of all of the creditors who continue to contact you. Write down the times they call as well as what they say. This is evidence for your lawyer to use in court if necessary. 3 Contact a bankruptcy lawyer: Notify them that creditors continue to call you and share your evidence. They will inform the bankruptcy courts and begin necessary legal proceedings. 4 Take creditors to court: If the harassment does not end, you may need to fight against your creditors in court. Here, you may be able to sue them for the harassment and emotional suffering they’ve caused.
That warning is usually enough, but if you continue to be harassed by collectors, your attorney can ask the Bankruptcy Court to impose sanctions.
In addition to discharging and reorganizing your various debts, bankruptcy has the benefit of stopping collection activity with a court order, called an automatic stay.
When you file for bankruptcy, you should notice an immediate decrease in collection efforts. But since some creditors have a hard time integrating bankruptcy notices, they may continue to call while their system catches up. If you receive a call shortly after filing, tell the caller that you filed bankruptcy and that an automatic stay is in effect.
If you continue to receive harassing creditor calls, the Cleveland bankruptcy lawyers Matthew Alden and Patrick Miller can help. Contact Luftman, Heck & Associates today at (216) 586-6600 to learn about your legal options during a free case review.
You May Need to Resort to Legal Action. So if you successfully completed a bankruptcy and are now on the receiving end of somebody’s telephone calls, dunning letters, or lawsuit regarding a debt that existed before you filed your bankruptcy, you need to talk to an experienced bankruptcy lawyer.
If the offending creditor will not voluntarily stop their collection efforts against you, legal action against them must be considered. In many instances, the creditor is required to pay your reasonable attorney fees — and you also may be entitled to compensation for their violation of the bankruptcy code.
If you listed it and you received a discharge, then you are no longer responsible or liable for that debt. Most people think that that means no more telephone calls, dunning letters, or lawsuits from people trying to collect on that debt.
Let’s repeat that: You don’t owe anymore after bankruptcy. So why are creditors still bugging you? The bankruptcy discharge eliminates your obligations to pay debts included in your bankruptcy filing. If you listed it and you received a discharge, then you are no longer responsible or liable for that debt.
There are some creditors who may take your bankruptcy personally and persist in trying to collect on a discharged debt. Worse than these, however, are the debt buyers who know they are breaking the law and figure that the majority of people won’t put up a fight.
Most folks find that the most effective thing to do in that situation (when a creditor calls you shortly after your case was filed) is to answer the phone and tell the person that called that you have filed for bankruptcy protection. Provide them with your case number and the date your case was filed.
The court has as much an interest in creditors following the law by not contacting folks in bankruptcy as you do.
What if the creditor keeps calling even after you provided them with your case number. Generally speaking, creditors know that they are forbidden from contacting you after they have actual notice of a bankruptcy filing and they will stop as soon as they get a case number from you. If a creditor continues to contact you (either by phone, ...
Ultimately, if the court finds that the creditor simply does not care that you filed for bankruptcy and intentionally continues to harass you, the court can sanction (or legally punish) them. Contact your court’s clerk’s office to find out how to bring this to the judge’s attention.
What to do if it’s been a few days since you filed and they really should have received the notice from the bankruptcy court by now. If it has been a few days since you filed when you are contacted by a creditor and you have already received the official court notice for your case (you will get the same notice that is sent to your creditors), ...
Written by Attorney Andrea Wimmer. The whole idea behind bankruptcy protection is to give you a breather from your creditors. That is why the automatic stay goes into effect as soon as your case is filed, and you don’t have to wait for your discharge to be entered, to be protected from creditor action.
There is a $32 court filing fee to add a new creditor (it’s $32 whether you add one creditor or a bunch of creditors). If you intentionally fail to list this additional creditor now that you know they exist, the balance you owe them may not be discharged.