Questions We Often Answer About Bankruptcy
Getting answers to your questions can be the first step back to financial stability after your debt has become out of control. At Christopher Todd Morrison, P.C., you will find explanations in plain English to put your mind at ease as you find your way beyond crushing debt, toward a fresh start.
At the law offices of Christopher Morrison, you will find compassion, skill and efficient teamwork committed to helping you achieve debt relief. To get started, review the questions and answers below. Take advantage of our offer of a free consultation.
‘Won’t a bankruptcy on my record leave me financially scarred for a very long time?’
Think of it this way: It may take a very long time for you to turn things around if you keep going down the road of crushing debt. The fact that you are considering bankruptcy means you need a change. A completed bankruptcy will show up on your records in some places for some time as follows:
- A bankruptcy will appear on your credit reports for 10 years – but remember, your debts may be wiped clean from those same credit reports.
- Your debt discharge from the bankruptcy court will be part of the public record but only seen by those who look for it, perhaps in a background check.
However, a bankruptcy in your background is not all bad news. Remember these points:
- Most people in your life do not need to know you have filed bankruptcy unless you tell them.
- With your out-of-control debt out of the way, you will have the opportunity to rebuild your credit much more quickly.
- Evidence that you have pulled yourself up and forward after a financial crisis can be seen as a credit to your perseverance. How you perceive and work with the experience is up to you.
‘Doesn’t bankruptcy mean failure?’
The word “bankruptcy” carries a stigma for many people who associate it with financial irresponsibility. However, it is the right decision for some debtors. Many noteworthy Americans, including Abraham Lincoln, Mark Twain and Walt Disney, have taken advantage of the legal right to file bankruptcy. Ordinary people do so every day. Think of it as walking away from what was not working and in the direction of a fresh start.
‘What kinds of debts can be discharged in bankruptcy?’
Unsecured debt such as credit card bills and medical bills can be discharged through Chapter 7 bankruptcy if you are eligible for it. Secured debt, such as mortgage and car loan arrearages, can be repaid through a Chapter 13 bankruptcy, usually with little or no interest, over three to five years.
‘Are all kinds of debts eligible for bankruptcy discharge?’
No. Student loans, unpaid child support, most taxes and criminal restitution are examples of debts that cannot be discharged in bankruptcy.
‘Will I lose everything I own by filing bankruptcy?’
Thankfully, no. Whether you use state or federal bankruptcy laws, there will be exemptions that do not need to be included in your bankruptcy. If you are someone of ordinary means, you may be able to keep most or all of your personal property at the same time that your debts are discharged through bankruptcy.
‘What should I do if I cannot catch up on my mortgage under my current debt load?’
You may seek a loan modification through your mortgage lender to lower your monthly payments. Also, or instead, you may be eligible to reorganize your debts, including your past-due mortgage premiums, with an affordable three- to five-year repayment plan with the help of a bankruptcy trustee.
‘What if I have received notices that foreclosure of my home or repossession of my vehicle may soon occur?’
When you file for bankruptcy, the stay of execution – a legal provision – can stop foreclosure and prevent your mortgage loan company from collecting on your past-due mortgage. You will be able to take a breath while arranging an affordable debt repayment plan with the help of a bankruptcy trustee. Then, if you have regular income with which to resume making payments, you may get your home loan back on track over a few years with much less pressure.
Alternatively, you may decide that it is time to let both your mortgage and your too expensive house go. Perhaps a divorce or business shutdown forces you to go this route. A short sale and/or bankruptcy may allow you to do this without owing any more.
The same ideas may apply in the case of your car or truck and a large loan that you took out to purchase it. Through bankruptcy, you may be able to get your loan back on track and keep the vehicle – or you may decide to let your car or truck go, along with the loan, and have no remaining balance due.
Bring Your Questions And Piles Of Bills That You Cannot Pay
What else do you want to know about bankruptcy? In the past 20 years, I have helped more than 5,000 debtors find debt relief through bankruptcy. From my Houston law office, I am here to clear up misunderstandings and point you and other Texans in the right direction when debt has gotten out of control.
To schedule a free case analysis, call 713-396-3704 or send a quick, simple and confidential message online for a prompt response.