Common Questions/Concerns About Bankruptcy
Sometimes bad Things Happen to Good People
We at the Law Offices of Gregory A. Ring care and understand your situation. We recognize that sometimes bad things happen to good people. We help people who otherwise pay their debts, but find themselves overwhelmed by burdensome debt through no fault of their own. Illness, loss of job or failed business and divorce are some of the most common causes of bankruptcy.
Common Bankruptcy Myths
I Can’t Get Rid of Taxes in Bankruptcy
False. Many taxes such as income taxes and sales taxes can be discharged in bankruptcy if certain criteria are met. [see more*]
*Dischargeability of taxes depends on the age of the taxes, the date the taxes were assessed, the dates you filed your required returns and whether you committed fraud. It may be that the taxes are not dischargeable and that a chapter 13 bankruptcy would discharge some of the taxes or repay taxes enter into a manageable repayment plan. Discharging taxes in bankruptcy is very tricky, and you should not conclude you can discharge them without first consulting with an experienced bankruptcy attorney.
Bankruptcy Will Ruin My Credit
False. Although it is true the fact of filing bankruptcy can be reported on your credit and will stay there for up to 10 years, it is also an opportunity for you to begin rebuilding your credit score.
*Rebuilding your credit will take time, but there are steps you can take to improve your score. One simple way is to obtain a secured credit card.
I Will Lose All My Property If I File Bankruptcy
False. The vast majority of people who file bankruptcy in Arizona and Nevada keep their property. [see more*]
*Whether you are allowed to keep your property depends on the value of the property or how much equity you have in it and applicable exemptions you have available.
Bankruptcy Is Failure
Millions of Americans and many famous people have filed bankruptcy and have gone on to lead happy, successful lives. Bankruptcy is in the Constitution and is there to give honest people a fresh start.
The Bankruptcy Process
The Chapter 7 Means Test
To qualify for chapter 7 bankruptcy you must pass a means test. To pass this means test your household income must be under a certain amount. If it is over the allowed amount, you may not qualify to file chapter 7. Instead, you would have to file a chapter 13 bankruptcy and pay your creditors over a 5 year period. Even if your household income is over the median income for your household size, you may still pass the means test by applying certain of your monthly living expenses into the formula. Not all of your actual expenses go into the calculation. Most of the expenses are set, regardless what you actually pay. The means test calculation is very complicated and you should consult with an experienced bankruptcy attorney to see whether you can pass the means test.
Does your Spouse also Have to File Bankruptcy
No. You can file a joint bankruptcy petition with your spouse, or you can file separately. In some cases, your spouse may not need to file. It will depend on the nature of your debts and other factors. Arizona and Nevada are community property states. This means that each spouse is generally liable for the debts of the other spouse that were incurred during the marriage for a community purpose. For example, if you incur a medical bill, your spouse is also liable for the bill. In this scenario, if you file for chapter 7 bankruptcy, but your spouse does not file, your marital community would
In a chapter 7 case, with rare exceptions, you will receive your chapter 7 discharge in the mail within a few months after your meeting of creditors. In a chapter 13 case, you will receive your discharge after you have made all your required chapter 13 plan payments.
The Cost of Filing Bankruptcy
The attorney’s fees and costs you will be charged will depend on your individual situation and which chapter bankruptcy you file. The court filing fees for chapter 7 are $335 and $310 for chapter 13. We offer a free, 30 minute consultation and can quote you a fee at that time.
Appearance in Court
About a month after we file your case, you will be required to appear before the case trustee. Mohave County residents can appear in Bullhead City. Mr. Ring will be with you at this hearing which is called the meeting of creditors. You will need to provide identification and proof of your social security number and answer some basic questions about your petition, schedules and statements.
We can file your bankruptcy with the bankruptcy court electronically. Once we have all of your financial information it does not take long to prepare the petition and schedules for filing. Once filed, a stay is immediately in effect that stops creditors from contacting you about the debt and halts, foreclosures, garnishments and harassing creditor calls.
The Initial Consultation
We offer a free, 30 minute initial consultation, either in the office, by phone, or we can answer your individual question by email. At the consultation, Mr. Ring will question you about your financial situation and determine if you qualify to file chapter 7 or chapter 13 bankruptcy.
The Bankruptcy Code requires you to first obtain a credit counseling certificate. This course takes less than an hour and can be done on-line at your home or in our office.