Credit Counseling

Before you even file bankruptcy you will have to complete a credit counseling course through an approved agency. Most of these agencies have online and phone courses so you can complete the course from home in as little as 30 minutes. The typical cost is about $25, so it’s rather painless. The course is meant to give you an understanding of your decision and possibly convince you that bankruptcy isn’t right for you. There is no test or anything.

Bankruptcy Petition

Once you have completed the credit counseling course you can file your chapter 7 bankruptcy petition. The petition contains all of your personal financial information such as your debts, assets, income, expenses, and a statement of intention about what you plan to do with property you own but still owe money on.

341 Meeting

Once your petition is filed the bankruptcy trustee in your district will schedule a 341 hearing which can be attended by your creditors. Most of the time creditors do not appear, but you should be prepared to answer questions posed by them. The trustee will confirm your information and ask you about anything he needs more information on. This meeting is usually over in about 5 minutes unless there are problems at which time a hearing may be scheduled.

Personal Financial Management Course

Before your bankruptcy can be discharged you must complete a personal financial management course. You will receive a notice from the court letting you know when this class must be completed by in order to receive your bankruptcy discharge. Much like the credit counseling course this class can usually be completed in person, over the phone, or online. This course helps you create a budget to stay on track after your bankruptcy and give you financial tips to avoid financial problems in the future.

Chapter 7 Discharge

The final step in any chapter 7 is the discharge, this is the end when all of your debts are formally wiped away! You will receive a discharge notice in the mail and can start rebuilding your credit.

Copyright 2010 Bankruptcy Information

Iconic film maker Kodak is set to file for Chapter 11 bankruptcy, according to multiple reports from across the US media.

The once market leader in film technology has been slow to catch up as rivals embraced the digital age. Some months ago we reported on the closure of last US laboratory to process the company’s seminal Kodachrome film, and as more and more film makers and photographers have moved to digital, the company’s days have always appeared numbered, short of a dramatic change of course.

Kodak is hoping to sell sufficient digital patents to keep it afloat during a major restructure, reports the Wall St Journal, but it seems clear its role in future imaging technology advances may be much less seminal than was once the case, if indeed it plays one at all.

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If you are filing chapter 7 bankruptcy judgments are basically considered like any of your other debts. You will include the judgments on your schedules and include the information on your statement of financial affairs. The companies that received the judgments will have the opportunity to speak on their behalf just like any of your other creditors. If the judgment is discharged with your other debts then it will be forgiven and removed from your credit report. If you are filing chapter 13 the judgment debts will be included in your repayment plan like your other debts and discharged at the end if you complete the 13 repayment plan.

As soon as you file your bankruptcy petition an automatic stay goes into effect. This stay stops creditors from being able to contact you about the debt or try to collect on the debt. It’s one of the best aspects of bankruptcy for a lot of people because the constant calls can be so humiliating and annoying. Creditors are notified by mail however, so it could be a few days before they know about the bankruptcy. If you are brave when they call you can simply tell them you have filed and give them your bankruptcy case number so they can verify. At that point they will no longer be able to contact you. If you are not comfortable doing that, you can just wait until they receive the notice in the mail.

A bankruptcy filing stays on your personal credit report for 10 years. Any time someone pulls her full credit report for approving her for a loan, credit card, or even employment, they will see the bankruptcy filing. Filing for bankruptcy however can actually improve ones credit if it’s been severely impacted by late or non payments. By filing she can start improving her credit much more quickly, so the affect will depend on what she is planning to do in the near future. Any debts she files on that are discharged will be wiped from her credit reports so no one will see those late payments. If she doesn’t intend to buy any large purchases for which she would need a loan for the next 5-7 years and is currently employed and not intending to leave she may not really be affected at all. Bankruptcy gives people a new start, but the biggest thing is learning from the mistakes already made so that they are not made again.

As a married couple you can choose to file bankruptcy together or separately. Even if you are married though some of your spouses information will need to be included such as assets you own together, debts you are responsible for together, expenses, and possibly their income to determine if you are eligible to file. If you are filing separately, debts you owe together will not be totally wiped out, you may have the debt discharged if you are filing chapter 7, but your spouse would still be responsible for the debt since their name is still on the debt. If you have no debts together then any debts that are discharged are gone completely.

There are a number of issues here. First is the extreme expense of education. Almost everyone needs some amount of financial help in order to afford college. Second is the likelihood that the borrowers would be able to pay back the debt. As you’ve pointed out, right now that likelihood is pretty low. For a bank to make a loan they need to see a payment history and income, two things that most kids going to college don’t have. No banks would make a loan to a student, so the government stepped in and created government backed student loans that could not be discharged in a bankruptcy to ensure that banks would give out loans because they were ensured to be repaid.

There is actually a way to have student loans discharged in bankruptcy however. You must prove several things including that the debt repayment amount is significant enough to affect the minimal standard of living and this will continue to be the case for the foreseeable future.

How soon after declaring bankruptcy can I own property? We would like to put my name on the house at some point, but don’t want it to look like we have been hiding assets.

Generally speaking, any property you receive in the year following your bankruptcy is considered part of your bankruptcy estate and can be sold to satisfy your creditors. This is why on you are asked about property, gifts, estates, financial awards, etc that you expect to receive in the next year during your bankruptcy. It’s similar to a tax return or inheritance, if you are expecting money or property that can be sold for money, your creditors are entitled to it as payment for your debts. It’s best to speak to a local bankruptcy attorney if your area to determine the best time to buy property in your name, especially if you are paying cash.

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Copyright 2010 Chapter 13 Bankruptcy Information

There are two things I look at when judging a moral bankruptcy, were the debts made in bad faith, or good faith. If you truly believed you would be able to pay back the debts when they were made, but them something happened that affected your ability to make the same amount of money that would allow you to pay the debts, that is good faith. If you made the debts knowing that you would not be able to pay it, that is bad faith.

For instance, you lose your job and can no longer afford the monthly payments but had you kept your employment, you would still be making the payments, that is good faith. If you lose your job and decide to take one last blow out vacation because you realize you won’t be able to afford one for a long time, and hey you can just include the credit card debt in bankruptcy, well, that is bad faith.

Even if you believe you should pay debts that you made in good faith, filing bankruptcy isn’t always morally wrong. If you have credit card debt and a mortgage debt and are having financial problems, you could end up in a situation where you lose everything, but if you file bankruptcy, you could save your home and continue on to pay off that debt. Yes, the credit cards didn’t get paid, but you took care of your largest debt obligation, and made sure your family had a roof over their head. Taking care of your family is a moral obligation as well, so where do you draw the line?

Morality is often personal, and rarely black and white. The bottom line is bankruptcy can help you by relieving stress and depression, making your finances manageable, and allowing you to keep the property you need in order to live, like your car and house. While it’s easy to sit back and judge those in positions less fortunate than ourselves, none of us truly know what we would do in a situation until we are there. If you are worried about your own morality, consider all of your options, and remember that you can always repay a debt even if you have included it in a bankruptcy filing once you are in a better financial position.

Copyright 2010 Filing Bankruptcy Information