A reaffirmation is an official way to “reobligate” yourself on the loan. This involves the lender sending us a reaffirmation contract to be signed by you.
How Is a Chapter 7 Bankruptcy Different from A Chapter 13?
In a both a Chapter 7 and in a Chapter 13 the court is trying to accomplish two things. They are trying to help you get a fresh start, and they are trying to treat all of your creditors equally. One of the rules to treating the creditors equally is to list all of your debts. You are not permitted to pick and choose who you are filing bankruptcy on. You cannot say, “Hey I’m going to keep this credit card” or “I don’t want to include this particular debt.” The court says no, you have to disclose all of your debt. That being said, not necessarily all of the debts will be discharged. The great majority of them will, but Chapter 7 does not discharge things like taxes that do not meet certain criteria, or student loans, and child support.
There are a couple other less common things. If you had a debt, a judgment that was from malicious destruction of personal property or particular debts that carry fiduciary duties, those are actually pretty rare, but child support, and student loans, those are the most common. Taxes can potentially be discharged if they meet certain criteria. Essentially if they are income taxes that are older than three years, and the tax returns were filed more than two years prior to the bankruptcy, and there have not been any assessments in the past two hundred and eighty days, and no tax liens on file. When a client has tax debts, we pull the IRS account transcripts to see if those criteria apply. It is possible to discharge taxes if they meet these criteria.
How Do You Determine Which Chapter Of Bankruptcy Is Suitable?
When I created Atlas Law Firm, I wanted the practice to be focused on client communication. That is a very important part of what we do, and the two pillars of good communication are: 1) you have to actually listen to the person you are talking with, and 2) give that person enough time to tell you what is going on with them. That is where my focus is whenever I meet with somebody for a free consultation. We are going to take as much time as the client needs. It typically takes about an hour, sometimes a bit more, sometimes a little bit less. The past firms I used to work for were so busy doing so many bankruptcies and had so many people coming in and out, that I had no time, but maybe thirty minutes to spend with each client.
It is very difficult to have a thorough conversation and appropriately analyze a person’s situation in thirty minutes, because I am not only asking questions to get information about your situation. You are likely explaining to me what the debt situation is and how you got into the situation. It is not uncommon at all for people to say, last year I had a 790 credit score and now I find myself here. It is important to hear those things. Beyond just getting that information, I also have to explain your options, describe the pros and cons of each of those options, so that you can make an informed choice on what makes sense to you: whether it is a chapter bankruptcy, or possibly no bankruptcy at all.
If you do choose bankruptcy or a different option, I will take the time to explain what everything means, down to the littlest detail, including what the timeline is and all the pros and cons. What it looks like and how it all works. I will also tell you what I need from you on your end as well. All of that takes time and there are so many firms out there that are pushing their attorneys to get clients in and get them out the door, barely explaining anything. These lawyers throw the clients a checklist of what they need, quote them a price, and move onto the next client.
If you have taken the time out of your day to sit down with somebody you do not know, to basically bear out the difficult details of your financial life, you want somebody to show you the courtesy of at least taking the time to listen. That is a huge focus of what we do and make sure that you know we hear you and know what your goals are, where you are coming from, and what you want to see accomplished.
For more information on Difference between Chapter 7 & 13, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling today.
Chapter 13 is essentially a payment plan that you organize through the court system. Think of it as a consolidation loan with teeth.
There are 2 things you must do after your case is filed: (1) attend the meeting of creditors (aka the 341 hearing); and (2) complete a debtor’s education course via phone within 75 days from the date your case was filed. The 341 hearing is sometimes referred to as the meeting of creditors because your creditors can attend the meeting and ask you questions about the information contained in your petition.