Bankruptcy Page 2

THE PROCESS
Bankruptcy Eye

After you have paid, taken your counseling course, supplied the documents listed on the last page (there may be addition documents necessary), signed your completed paperwork, then we will file and get your case number. The case number means you have actually declared and filed Bankruptcy.

We will meet for your creditor’s hearing in about two-months. It will be in an office that the Trustee uses. That should be the only time you have to go to court or a hearing of any kind. Relax, creditors seldom show-up or oppose bankruptcies.

We will be there about an hour and a half, because we do have to wait our turn, then your turn should only be about 5-minutes or less. After that event, in two or three months, you should get your discharge. A discharge is a Court Order, signed by the Judge, which basically means that you never have to pay most of your debts which were listed or took place before your bankruptcy filing date. So, generally, you need not worry if you have forgotten or missed an ordinary debt.

In Ohio, it is legal for a creditor to sell the same debt to different collection companies and even multiple times at that. So, you may get some innocent robocalls or roboletters. The discharge is the document that you send a copy to them, or fax, simply tell them about. However, once you have done that, they do have actual knowledge of your case, and any subsequent contact, usually, is strictly illegal.

Yes, it is Great, but, Sorry, you can only file and get a Chapter 7 Bankruptcy Discharge every 8 years.

Why don't people file ?

Almost every case I come across, the person should have filed Bankruptcy years ago. Why didn't they ?

Shockingly, some people still think back to the days of small, farm communities, where the creditors would be "hurt" if you filed Bankruptcy.

Let's clear-up this misconception once and for all. First, Bankruptcy was invented because it is good for the economy in general. Bankruptcy greases the economy (makes it more fast and loose) by getting rid of old, stagnant debt which cannot ever be paid and allows the smart creditors to write it off on their taxes.

If you're still thinking Bankruptcy has a negative connotation because of all that free money, goods, and services it means you were given, think again. The money has already been paid by interest rates which have factored the percentage of Bankruptcies which will be statistically filed.

All smart business people consider Bankruptcy constantly, whether they are in financial straits or not, because it is one of the "rules of the game" and the immoral connotation, if any, because given the law and the availability of Bankruptcy to everyone for the overall good of the economy, there then becomes only three questions of immorality.

Did I obtain credit by promising someone that I specifically would not go Bankrupt on them ?

Did I obtain goods or services when I knew that I was about to go Bankrupt and I had no intent at the time to pay for them at all ?

Shortly before I went Bankrupt, did I hide assets or lie about assets in my Bankruptcy ?

If you answer these three questions no, then you are OK, and if you said yes, then you may be going to Federal Prison.

So, you ask, how will Bankruptcy hurt me ?

It can affect your credit worthiness. However, some people's credit is already so shot, when they go to rent an apartment, that is often where they are told to file Bankruptcy first. Around the year 2000, the credit reporting agencies concluded that they were treating Bankruptcies too harshly. Bankruptcy increases your "income-to-debt ratio" -- which is good. Bankruptcy gets rid of senior creditors -- which is good. Bankruptcy raises your discretionary income -- which is good. No more garnishments or minimum payments. Bankruptcy, not only stops garnishments (usually at filing) but also insures future creditors that your income is not going to be garnished by any of your old creditors.

The Bankruptcy will remain on your credit reports for 10 years to-the-day.

If you have a Bankruptcy and try to get a mortgage, it is possible that they may charge you an extra point(s).

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