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Bankruptcy FAQ

Our Oakdale Bankruptcy Attorneys at Lamey Law Firm, P.A. Have Answers

Lamey Law Firm, P.A. has been serving the residents of Oakdale for more than 30 years. Below, you will find brief answers to some of the questions we receive most. Our team serves throughout Pine Springs, Lake Elmo, Maplewood, Woodbury, Oak Park Heights, and more.

To learn more about bankruptcy, dial (651) 309-8180 or contact Lamey Law Firm, P.A. online!

I have a “simple” bankruptcy case. Do I really need to hire an experienced bankruptcy attorney? And is it more expensive?

You may think you have a "simple" case, but really there is no such thing. Each person is different, and each bankruptcy case has its own challenges. That being said, an experienced bankruptcy lawyer can recognize issues and opportunities which can help your case a great deal. Also, an expert can make the process go much more smoothly. Because Lamey Law Firm, P.A. specializes in bankruptcy, our fees are the same as and sometimes even less than other firms that do only the "occasional" bankruptcy case, and have to "relearn the wheel" each time that they do a case.

Is There a Minimum Amount of Money That I Have To Owe To File Bankruptcy?

No. The U.S. Bankruptcy Code does not set out any minimum amount of money that you have to owe or be in debt, before filing for bankruptcy.

That being said, if you owe so little that you can easily afford to repay it, and the U.S. Trustee's office or a creditor objected or filed a motion to dismiss your case, then yes, your case could possibly be dismissed for "abuse" of the bankruptcy laws.

But if you are unable to pay your debts, even though it is not a large amount of money owed, then there is no reason why you could not obtain a discharge or cancellation of your debts through bankruptcy, assuming that you otherwise qualify for it.

What Debts Are Dischargeable Through Bankruptcy?

The following are types of unsecured debt that are typically dischargeable through bankruptcy:

  • Credit card debt
  • Medical bills
  • Utility bills
  • Bills for services
  • Personal loans, payday loans
  • Judgments

Debts incurred through fraudulent activity, student loans, tax debts, child support, and alimony are typically not dischargeable in bankruptcy.

What Is the Difference Between Chapter 7 and Chapter 13 Bankruptcy?

In order to file under Chapter 7, your income must be less than the median income in the state of Minnesota or Wisconsin. If you qualify, your unsecured debt - credit cards, medical bills, and certain kinds of loans - will be wiped out.

In a Chapter 13 bankruptcy, your debt is restructured according to a payment plan agreed to by your creditors. A trustee is appointed by the court, tasked with ensuring you make payments on time and creditors receive a percentage of what they are owed over the course of 3 or 5 years.

Who Qualifies for Chapter 7 Bankruptcy?

To qualify for Chapter 7, the debtor must be able to pass the means test. The debtor's income is compared to the median income in their state of residence; if they make more than the median amount, they must take a "means test." The means test will take various kinds of deductions into account as a way to determine eligibility. If the bankruptcy means test determines that someone makes too much money to qualify for Chapter 7, Chapter 13 bankruptcy is another option to consider.

How Much Does it Cost to File Bankruptcy in MN?

If you are filing for Chapter 7, the filing fee in Minnesota is $338. If you are filing for Chapter 13 bankruptcy, the filing fee is $313. If you are unable to afford these fees, you have the option of paying in installments. When filing, you will be responsible for paying half of the fee and the remaining half must be paid within 30 days after the filing or as specified in the bankruptcy court's order.

Due at filing:

  • Chapter 7: $169
  • Chapter 13: $156.50

Failing to pay the fee or the installments as ordered will result in automatic dismissal of your case.

How Much Does It Cost to File Bankruptcy in Wisconsin?

The fee for filing bankruptcy in Wisconsin depends on which chapter of bankruptcy you are filing for. Effective December 1, 2020, below are the fees for filing bankruptcy:

  • Chapter 7: $338
  • Chapter 11: $1,738
  • Chapter 13: $313

Accepted forms of payment are via cashier's check or money order. Personal checks are not accepted.

Can I Own Anything After Bankruptcy?

Absolutely! This is just one of the many “urban legends” that surround bankruptcy. Many people believe they cannot own anything for a period of time after filing for bankruptcy. You can keep your exempt property and anything you obtain after the bankruptcy is filed. However, if you receive an inheritance, a property settlement, or life insurance within 180 days after filing bankruptcy, that money or property may have to be given to your creditors if the property or money is not exempt.

What Property Can I Keep if I File Bankruptcy?

Both Minnesota and Wisconsin allow you to choose either Federal exemptions which are laid out in the Federal Statues or state exemptions which are laid out by state law. Bankruptcy exemptions determine what property you can and cannot keep when you file bankruptcy.

  • In a Chapter 13 case, you can keep all of your property as long as you continue to pay any loan you have against it or pay the trustee at least the non-exempt value of any of your assets.
  • In a Chapter 7 case, you can keep all property that is “exempt” (protected) from the claims of creditors. So, if the property in which you have any equity is sold for the benefit of creditors, the exempt amount must be given back to you. If the property is worth less than the bankruptcy exemption, however, it will not be sold and you will be allowed to keep it.

Another option that your attorney will discuss is selling any non-exempt property before we file your petition and then using the money from the sale in an appropriate manner. That way, you get to keep the value of the unprotected piece of property. You should talk to a lawyer before you sell or give away any property before you file bankruptcy. Just because you no longer possess it doesn’t mean that the trustee can’t get it.

    How Many Times Can You File Bankruptcy?

    You may file for bankruptcy as many times as you need to -- there is no limit, however, there are time limits between when you can file for bankruptcy. The clock starts on the date you filed a previous bankruptcy petition. The time limits prevent people from abusing the system.

    Below is data on the Chapter to Chapter filings and the wait times:

    Chapter to Chapter Filings

    Wait Time Between the Filings

    Chapter 7 to a new Chapter 7 filing

    8 years

    Chapter 7 to Chapter 13 filing

    4 years

    Chapter 13 to Chapter 7 filing

    6 years,
    or full payment of Chapter 13 repayment plan

    Chapter 13 to a new Chapter 13 filing

    2 years

    Will I Have To Go to Court When I File Bankruptcy?

    In most bankruptcy cases, you only have to go to a proceeding called the “meeting of creditors”, which is a short and simple meeting where you are asked a few questions by the bankruptcy trustee. While the meeting is held at the courthouse, the meeting doesn’t take place in a courtroom.

    Occasionally, if complications arise, you may have to appear at a hearing in front of a bankruptcy judge. In a Chapter 13 case, you may have to appear at a hearing when the judge decides whether your plan should be approved (although in Minnesota that isn’t very often). If you need to go to court, you will receive notice of the court date and time from the court or your attorney who will help you prepare for your appearance.

    Can a Chapter 13 Be Paid off Early?

    A Chapter 13 plan can be paid off early by paying the unsecured creditors 100% of the amount that is owed. No discharge is necessary because there will be no debt left. If you experience financial issues during the payment plan, you may be able to get a hardship discharge.

    If your income is under the median income for the state, your "applicable commitment period" is 36 months, so you must pay for at least that period of time (unless you pay 100% of your unsecured debts back in less time). If your income is over the median income for the state, you must pay for 60 months.

      How Can I Get Bankruptcy Off My Credit Report Early?

      Getting bankruptcy off your credit report early is only possible in specific situations. Typically, depending on which type of bankruptcy you file, it will appear on your credit report for 7 to 10 years from the time of filing. Even if the filing was dismissed, it cannot be removed early.

      The only way to get bankruptcy off your credit report early is if there are errors in your credit report. There may be spelling mistakes, wrong spelling of names, errors in addresses and phone numbers, and errors in debt that was already discharged. If this is the case, the errors may be disputed. The dispute process is long and complex, so it may help to have the guidance of a credit report lawyer by your side.

      Can I Get Rid of IRS Income Taxes if I File Bankruptcy?

      Yes, if your taxes and your situation meet the requirements. An experienced bankruptcy lawyer can determine if you meet the qualifications to discharge or cancel your income taxes in bankruptcy.

      Generally speaking, income taxes can be discharged in bankruptcy: (1) if they are over 3 years old measured from the due date of the tax return; (2) if the tax returns were filed more than 2 years before the bankruptcy; (3) if the taxes were not assessed within 240 days prior to the filing of the bankruptcy; and (4) so long as the taxes are not owed by reason of an "SFR" or substitute for return prepared by the IRS There are other requirements, such as that the taxes cannot be the result of a taxpayer filing a false or fraudulent tax return, and the taxpayer cannot have intended to evade or defeat the taxes.

      I have online payday loans. Can they be discharged if I file bankruptcy?

      Short Answer: Yes, online payday loans can be discharged in bankruptcy, assuming that you qualify to file bankruptcy.

      Online payday loans are unsecured debts and can be discharged in bankruptcy just like credit card debt, bank loans, medical debt, broken leases on apartments and cell phones, and other unsecured debt.

      If you have bogus online payday loans that you cannot pay, by all means, dispute them, don't pay them. We have clients that get phone calls from "fake payday loan" debt collectors trying to get them to pay, and it is just ridiculous. They threaten them with arrest and having the sheriff come immediately and serve them with a lawsuit, it just doesn't work like that. You don't need to file bankruptcy on scam artists.

      But if you have payday loans that you owe and you cannot pay, and/or other debt problems call our office at (651) 309-8180 and make an appointment to meet with us.

      We will review your situation at no charge to determine if filing a bankruptcy case will solve your debt problems. You can either seek to cancel your debts in chapter 7 or at least pay them at a level that you can afford in chapter 13, depending upon your circumstances. But just to be clear: payday loans, including online payday loans, can be discharged in bankruptcy just like any other unsecured debt.

      I fell ill and had to be hospitalized with no insurance. Are doctor and hospital bills discharged in bankruptcy?

      Short Answer: As a general rule, yes.

      We talk to a lot of clients that seem surprised that hospital and medical bills can be discharged in bankruptcy.

      Medical-related debts are "general unsecured" debts and are usually discharged without payment in chapter 7, or paid whatever amount the general unsecured class is being paid in a chapter 13 case, which is often little or nothing.

      Keep in mind that if you are ordered to reimburse an ex-spouse for medical bills through a divorce decree or other order of a court, you may have to pay this kind of debt, or be held in contempt of court. Medical bills in such a case could be held to be "in the nature of child support," and not discharged by bankruptcy.11 U.S.C. Sec. 523(a)(5).

      Also, if you have a particular doctor that you are seeing and want to continue to see that doctor, even though you file bankruptcy on his bill, the doctor can refuse to treat you unless you pay it or agree to make payments on it. In reality, though, this does not happen very often.

      If you file bankruptcy, you must list all of your debts so in such a situation you may want to contact the doctor's office and let them know that you will be paying it. You can voluntarily pay any debt that you want after a bankruptcy discharge. 11 U.S.C. Sec. 524(f).

      Timing can also be important in medical bankruptcies. If you have major surgery or major procedure coming up that you may incur a lot of medical debt on, you may want to wait until after it is over, to be sure that you can include the bills from the event.

      Once the bankruptcy is filed, it may not be possible to include "after-acquired" debt in the bankruptcy. There are strategies to deal with that too, but come see us at our office to discuss these issues, if you are facing them.

      Can I File Chapter 13 Bankruptcy Just To Stall Foreclosure?

      Short Answer: No, it is not a proper use of chapter 13 bankruptcy to file a case just to get the protection of the "automatic stay" without the intent to complete the case.

      Some people file bankruptcies over and over (multiple or "serial" filers) to repeatedly stop foreclosures on their property. Not only is it wrong to do so, but it causes a lot of unnecessary legal expense to the mortgage companies that are foreclosing, and also a lot of unnecessary trouble and expense to the court system. The bankruptcy court can punish people or their attorneys through contempt of court or other means for filing multiple bankruptcies without the intent to make them work.

      Can My Homeowner’s Association Foreclose on My Home for Unpaid HOA Dues?

      Yes -- homeowner's associations in Minnesota can foreclose on your home for unpaid HOA dues. If you qualify, it may be possible for you to file a chapter 13 bankruptcy to stop the foreclosure and allow you to catch up your delinquent HOA dues, and possibly also deal with your other debts, in a way that you can afford.

      Can I Stop My Car Lender From Repossessing My Car or Truck by Filing for Bankruptcy?

      Short Answer: Yes. If you qualify, filing chapter 13 bankruptcy can stop your title loan finance company from repossessing your vehicle. It can also let you pay them back over time, at a reasonable interest rate, at a level that you can afford.

      If you are delinquent on your title loan payments or you see that you won't be able to pay it back anymore as fast as they want, give our office a call at (651) 309-8180 for your free consultation.

      Can I get my repossessed car back if the finance company has already had it picked up? I can’t afford to catch it up or pay it off.

      Short Answer: Yes, assuming that you qualify for chapter 13 relief, and the case is filed before the car is actually sold by the finance company, it is possible to get your car back.

      Then a chapter 13 plan can be filed with the court to propose that you pay the car off over time, at a level that you can afford, up to 5 years. Your other debts can also be included, and this often can give people control over their finances to let them live and work in peace.

      For an appointment, call our office at (651) 309-8180. Be sure to tell the receptionist that your case is urgent and that you have had a repossession. We can usually work you in the same day or the very next day, to save your car.

      Can You Get Arrested for Not Paying Student Loans?

      You cannot be arrested for not paying student loans. However, if you are being sued for a student loan, have a judgment granted against you, have been ordered by court to answer questions about your finances and you refuse, then you can be arrested. Non-compliance violates the court's order.

      Lesson: Always comply with court orders or you may get arrested and jailed.

      I can’t afford my monthly student loan payments. Are there any new repayment options for federal student loan borrowers?

      Short Answer: Yes.

      Effective Dec. 17, 2015, borrowers with Direct federal student loans will be eligible for the Pay As You Earn or PAYE program under the new REPAYE option, no matter when their loans were taken out.

      This means that if you cannot afford your regular student loan payments, you may be eligible to pay as little as 10% of your discretionary income towards your loans, with any unpaid balance forgiven after 20 years. Some borrowers may have a payment as low as 0 per month, depending upon their income.

      Will Bad Credit or Bankruptcy Keep Me From Taking Out a Parent Plus Loan for My Child To Go to College?

      Short Answer: Maybe.

      One of the requirements for being approved for a Parent PLUS student loan is that the applicant not have an "adverse credit history." The Department of Education has just made "credit check" requirements to go into effect on March 29, 2015.

      The new rules say that the Department will consider whether an applicant has an adverse credit history if the prospective borrower:

      1. has one or more debts with a total outstanding balance greater than $2,085;

      2. has debts that are 90 or more days delinquent as of the date of the credit report; or

      3. has debts that have been placed in collection or charged off as defined in the regulations during the two year preceding the date of the credit report OR

      4. if the applicant has been the subject of a default determination, bankruptcy discharge, foreclosure, repossession, tax lien, wage garnishment, or write-off of a federal student loan debt during the five years preceding the date of the credit report.

      Not having a credit history won't keep someone from qualifying for a PLUS loan. Also, an applicant may still qualify for a PLUS loan even if they have adverse credit histories if they can obtain an endorser (co-signer) who does not have an adverse credit history, or prove to the DOE's satisfaction that there are extenuating circumstances.

      How Long Does Filing Bankruptcy Stay on My Credit Reports?

      Short Answer: A bankruptcy filing can stay on your credit for 7-10 years depending on the chapter that you filed under. Chapter 7 bankruptcy stays on credit reports for 10 years, chapter 13 for 7 years.

      But that doesn't mean you can't re-establish credit for those periods of time! I have many clients that have gotten back on their feet, credit-wise, within 1-2 years. Scores in the mid-600's are common after that period of time, and scores of over 700 are not uncommon.

      How Long Does It Take Before We Can Buy a Home After Filing Bankruptcy?

      Short Answer: After filing bankruptcy, you may think that you will never be able to get a new mortgage to buy a home, particularly if you've also lost a home to foreclosure.

      But you would be surprised. Even though a chapter 7 bankruptcy can stay on your credit for 10 years from the filing date (chapter 13 for 7 years), the mandatory waiting period to apply for a mortgage backed by Fannie Mae or the Federal Housing Administration (FHA) is from two to four years.

      In fact, it is even possible to apply for an FHA loan while you are in chapter 13 bankruptcy, so long as you have been on your plan for at least one year, and have paid all of your trustee payments timely.

      But you should do what you can to repair and rebuild your credit first, in order to get the best interest rate that you can. Just because you can apply for a mortgage loan doesn't mean you should. You don't want to get stuck with a lousy interest rate.

      So yes, filing bankruptcy is something to be avoided if you can, but if you can't avoid it, it is not the end of the credit world for you, not by a long shot. If you have serious debt problems call our office at (651) 309-8180 to make an appointment or request information

      I am overwhelmed by student loan debt. How do I even start to deal with it? Help?

      Short Answer: A good place to start to figure out how to deal with overwhelming student loan debt is on the website of the Consumer Financial Protection Bureau (CFPB).

      If you have student loan debt and you are in default, or just overwhelmed with the amount of it and how to deal with it, check out the new "Paying for College" tool on the website of the Consumer Financial Protection Bureau (CFPB).

      Particularly if you have federal loans, there are many repayment options; you don't have to feel that you are in a hopeless situation.

      If you default on federal student loans, the Department of Education can put an "administrative wage garnishment" or AWG on your paycheck for 15% of your disposable pay. The DOE can also take your federal tax refunds to apply to your student loan debt. They can even sue you for the debt in federal court!

      There is no need to let it get that far, at least if you have only federal loans. If it already has gotten out of hand, you can seek help on the CFPB website and try to figure out the best way forward for you. If that fails, call our office anytime at (651) 309-8180 and make an appointment to come see us.

      How can I protect the co-signor on my private student loan? They are threatening to sue her!

      Short Answer: If someone co-signs a student loan for someone else, it is a serious thing. Many people don't take it seriously enough. Generally speaking, a co-signer that signs a promissory note for a student loan is agreeing to be liable for the entire debt, if the main borrower defaults. The debt collectors don't want to hear any excuses.

      If you have a student loan with a co-signer, it is likely a private student loan. Private loans are like an unsecured bank loan or unsecured credit card, they are just not dischargeable in bankruptcy. And if you don't pay it, you and your co-signer could be sued, and a court judgment entered against the both of you.

      You and your cosigner's bank accounts and non-exempt property could be seized to satisfy the judgment.

      If you want to protect your co-signer from these collection actions, you can file chapter 13 bankruptcy, assuming that you have regular income and you qualify. If you file chapter 13, there is a "co-debtor stay" that protects your co-signers.

      So long as the co-signed debt is a consumer debt, and so long as you propose to pay the debt in full (or cure the delinquent amount) during the chapter 13 case, your co-signer is protected by the Bankruptcy Court "automatic stay" and cannot be called, sued, or anything else for the co-signed debt, so long as you comply with your plan and pay the plan payments.

      If you are not sure of what to do, call our law office at (651) 309-8180 and make an appointment to come in and meet with one of our attorneys. There is no charge and no obligation for your first visit with us.

      Debt collectors are constantly calling. Can my credit card debts be settled for a reasonable amount of money?

      Short Answer: It is possible to settle credit card debts; at least once they are "charged off" or "written off." These terms don't mean that you don't owe the money anymore. They mean that the creditor considers your debt to them to be a bad debt, and accounting rules require that they no longer consider it an asset on their financial statements. Creditors must charge off credit card debt when it becomes 180 days or more delinquent.

      To settle credit card debts, at least to get the best discount to the actual amount owed, you must pay a lump sum of money, not monthly payments. If you don't have a lump sum, they will likely accept monthly payments, but they will want you to pay on the full amount of the debt, or a very high percentage.

      Example: Assume you owe $10,000 on a delinquent credit card debt that has been charged off. A debt collector may accept, for example, $3,000 in a lump sum to settle the debt. But if you don't have the $3000 to pay, they may in the alternative accept what you can afford to pay per month, say $150 per month, but they will likely expect you to repay a much larger total amount, say $8,000, with the other $2,000 forgiven.

      And don't forget that the amount that is forgiven can be taxable income to you, with certain exceptions. In the example where you settle for the $3,000 lump sum, you would receive an IRS Form 1099 from the creditor for $7000, and you may have to pay income tax on that amount. This is not true if you file bankruptcy.

      Our firm frequently handles debt settlement matters for clients who either wish to avoid bankruptcy or cannot file bankruptcy for other reasons. We can discuss this option among others at a no-cost initial consultation.

      Is It Legal for a Company To Pull My Credit Report Without My Permission and Without a “Permissible Purpose”?

      Short Answer: No, it is a violation of the Fair Credit Reporting Act (FCRA) for a company or person to obtain your credit reports, unless they have your permission, or unless they have a "permissible purpose" under the law.

      If this occurs, you have the right to bring suit, to have your attorney fees paid, and to be paid $1000 as statutory damages.

      Can I File Bankruptcy and Not Include My Spouse and Not Their Credit?

      Short Answer: If you have credit accounts just in your name, and your spouse has credit just in their name, and only one of you has financial problems, it's an easy decision that only the one that has financial problems should file bankruptcy.

      Just because you are married does NOT "merge" your credit files. If you apply for credit together, yes, both your files are shown to the creditor pulling the credit. But the only thing that causes both of you to suffer credit-wise when only one spouse has financial problems, is if you have joint credit accounts.

      Many times, people come in to meet with our attorneys and only one spouse wants to file bankruptcy so that they can "keep the other spouse's credit" so that they can buy a house or something else in the future. Well, that is fine if all of the debts that will be listed in the bankruptcy are in the spouse-to-file's name.

      But if people have been married a long time, it's common that they have one or more "joint" accounts, on which they are both equally liable. And it's not a good idea for only one spouse to have credit, period. Both should have some credit, in case something happens to the other spouse or they get a divorce, etc.

      In my experience, if the debt that you and your spouse have or a substantial part of the debt is joint debt, it is better for both spouses to file bankruptcy. Your credit can recover quickly after a bankruptcy, so long as you do not default on new obligations.

      If I File Bankruptcy Without My Spouse, Will It Hurt My Spouse’s Credit?

      Short Answer: Probably not. Credit reports and scores are kept separately for each individual. So if you file bankruptcy, the fact that you filed will not show up on your spouse's credit report on the "public record" section of the report.

      On the part of your credit report that lists your debts, the "tradeline" section, the story is a little different.

      If you have "joint" credit accounts, that you are both liable to pay, then the creditor can still seek to collect the debt from the non-filing spouse. They can also continue to report the status of the debt on the non-filing spouse's credit. So to preserve their credit, the non-filing spouse would have to timely pay the debt.

      Also, if your non-filing spouse (or someone else) is an "authorized user" on one of the credit cards that you intend to list in your bankruptcy, you want to have them removed, if possible, before you file bankruptcy. Otherwise, the account will show it was discharged in bankruptcy on their credit report.

      As a practical matter, it is often better for both spouses to file bankruptcy together, to get a fresh start for both of them. Your credit scores can recover quickly after a bankruptcy, and it is usually little or no more expensive on the attorney fees for both spouses to file together.

      What Can I Do To Improve My Credit?

      Short Answer: Many of my clients want to improve their credit. The best things to do: (1) pay your debts on time; (2) use credit only when necessary, and only have a small number of credit cards; (3) use only a small percentage of your available credit. The credit scoring systems look at your "utilization ratio" to try to tell if you are using credit responsibly, or if you are "maxed out" (4) check your credit reports at least annually for free at, which is the official website sponsored by the three major credit reporting agencies. Dispute inaccurate or obsolete information.

      If you are currently "swamped" with debt, consider filing bankruptcy to get a fresh financial start. Your credit can recover quickly if you follow the above advice after the bankruptcy. I have clients whose credit score is over 650 after one year after bankruptcy and 700+ after two years. You really can recover your credit after a bankruptcy. We’ve heard that from many of our past clients over the years.

      Will I Ever Be Able To Get Credit After Bankruptcy?

      Short Answer: Yes. If you pay your debts on time in the future, you should be able to re-establish good credit in as little as 2 years. I have many clients that can get their credit score into the mid-600's after one year, and into the 700's after 2 years.

      But you must "keep your nose clean" and not default on any future debts. And if you have defaulted debts that remain on your credit after bankruptcy, such as defaulted student loans or child support that was not discharged, you must get those out of default if you expect to get your good credit back.

      My law office will do a "credit clean-up" or request for reinvestigation after your discharge, to make sure that your credit is as good as it can be. After that, it is up to you. I recommend that you go to and order your free credit reports, once per year and dispute any inaccurate information.

      I can’t open a bank account because of Chexsystems. Can bankruptcy help me get an account?

      Short Answer: Companies such as Telecheck or Chexsystems gather up information about how people use their bank accounts. If you have bounced checks, or overdraft your account, or owe the bank money for fees, etc. they can close your account and not do business with you anymore.

      And a bank may subscribe to a company like Telecheck or Chexsystems to see how you have handled your banking relationships in the past, and deny you a new account if they don't like what they see.

      But if you file bankruptcy, be sure to tell your attorney that you owe a bank for an overdraft account. Then the attorney can list the bank as a creditor so that what you owe the bank can be discharged or canceled by the bankruptcy.

      Then after the bankruptcy, a letter should be sent to Telecheck or Checksystems with a copy of the discharge, and a list of the debts that were discharged, to make sure that they correct their records. Here is information about exactly how to do that.

      Can You Sue Someone Who Has Filed Chapter 7?

      A debtor who has filed for Chapter 7 may be sued if the creditor can obtain an exemption from the automatic stay -- this typically includes persons with non-bankruptcy-related claims: secured creditors, cosigners, or lessors.

      To sue, the creditor must be able to prove:

      • The lawsuit is not related to bankruptcy
      • The debtor is only using bankruptcy to delay their payments
      • The debtor is not carrying out their duties per the bankruptcy
      • The automatic stay does not actually protect the debtor (example: debtor's property value is decreasing rapidly)
      • The automatic stay creates an unfair burden on person that is interested in the debtor's property

      Can a Chapter 7 Trustee sue my relatives for money I repaid them before I filed for bankruptcy? What is a preference?

      Short Answer: Yes, if you are about to file chapter 7 bankruptcy, don't repay any relatives or friends for money that they have lent you. If you do, your bankruptcy trustee can sue them to get it back! Trustees use these "strong arm" powers to get money back that you have repaid in the 90 days before you filed bankruptcy for ordinary creditors (unsecured creditors) or in the 1 year before filing bankruptcy for "insiders" which includes relatives and in many cases, your friends.

      That's why in some cases it may be suggested that you want to wait to file bankruptcy, at least if you want to try to protect these payments from being recovered by your chapter 7 trustee. Better suggestion: just don't pay them before you file bankruptcy. You can always pay your relatives or friends after your bankruptcy is over, from the money that you earn after the filing of the bankruptcy.

      I am in a debt management program now, but I was still sued by a creditor. Can I file bankruptcy?

      Short Answer: Yes. You can simply stop payments to the debt management program, notify them that you are no longer going to participate in the program, and contact a bankruptcy lawyer.

      Quite a few of our clients have tried to repay their debts through a debt management program, and could not complete it for one reason or another. Not all creditors will participate in such a program, for one thing.

      Or perhaps the consumer had some financial or personal emergencies that caused them to miss payments, and they were dropped from the program. Whatever the cause, there is no reason why you cannot file bankruptcy, if you are no longer able to complete a debt management program.

      Can I File for Chapter 13 Bankruptcy if I Have Filed for Bankruptcy Before?

      Short Answer: Yes. You can file for bankruptcy as many times as you need to. However, there are some rules attached.

      If you have filed for Chapter 13 bankruptcy before, you may not receive a discharge until at least two years have passed. A discharge releases you from all debts that were accounted for in your plan, minus a few exceptions such as student loans, recent income taxes, and child support. You will have to wait at least four years to file for Chapter 13 if you previously filed for Chapter 7, 11, or 12 bankruptcy. The waiting period is a little longer between filing for Chapter 7 twice; debtors must wait eight years.

      Bankruptcy law is federal law, contained in Title 11 of the United States Code, so it is the same throughout the nation. However, state property law and local rules and customs also play an important part in any bankruptcy case, so prior to taking any action, it's extremely important to consult an experienced bankruptcy attorney in your area.

      It is also vital to speak with an attorney because you need to be sure that Chapter 13 bankruptcy is your best option. You may have filed Chapter 13 in the past, but perhaps now you're in a situation where you don't have a job anymore and medical bills you didn’t plan for are burying you. Chapter 7 bankruptcy might be a better option for you in this instance. Likewise, maybe you filed for Chapter 7 bankruptcy five years ago, and while you're in financial trouble again, you do currently have a reliable source of regular income; you could be a candidate for Chapter 13 this time around.

      Bankruptcy is taken very seriously, so it is important that you don't rush into things and file incorrectly. If you are thinking about filing for Chapter 13 bankruptcy, contact our office at (651) 309-8180. Your first consultation with our office is absolutely free and he will review your finances with you to determine the best course of action.

      If you are thinking about filing for Chapter 7 bankruptcy, contact us for a free consultation at (651) 309-8180.

      What Happens to a Co-Signer When I File Bankruptcy?

      Short Answer: If someone cosigned a loan for you, he or she will still be on the hook if that loan is eliminated in bankruptcy and will have to pay the loan. If your cosigner is a relative, you can imagine the stress this might cause in your relationship. If you have a cosigner you want to protect, you’ll need to consider negotiating an alternative payment plan with your creditor or filing Chapter 13 bankruptcy.

      Do you have more questions? Reach out to us at (651) 309-8180 for a free review of your case.

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