A bankruptcy is a legal statement that a person or company is unable to pay its creditors or debts. Bankruptcy filings are largely governed by legislation that fall under the purview of the federal government. State law governs the legality of bankruptcy claims and exemptions, which differ from state to state.
How Long Will My Bankruptcy Remain On My Credit Reports?
Credit reporting companies are not subject to the jurisdiction of the Bankruptcy Court. The Fair Credit Reporting Act, 6 U.S.C. Section 605, governs credit reporting organizations. Credit reporting bureaus are prohibited by law from disclosing a bankruptcy case on a person's credit record after ten years from the date the bankruptcy case is filed. After seven years, further negative credit information is deleted. The main credit reporting organizations are members of the Associated Credit Bureaus. To encourage debtors to file under these chapters, the Associated Credit Bureaus has a policy of removing chapter 11 and chapter 13 cases from credit reports after seven years.
I'm wondering if I'm eligible for bankruptcy and what the conditions are.
There are distinct qualifying conditions that are defined by federal law and so apply equally to all states depending on the type of bankruptcy proceedings that you desire to launch. For example, there are family income qualifying criteria for those who want to declare Chapter 7 bankruptcy to get their debts totally discharged. However, there are restrictions on the types and quantities of debt that you can hold if you want to apply for Chapter 13 bankruptcy restructuring. As a result, your eligibility to file for bankruptcy will vary depending on your unique financial status and the type of bankruptcy relief you want.
Will I lose my house, vehicle, and other personal belongings if I declare bankruptcy?
Not necessarily; each state has regulations governing whether objects or property are immune from seizure. Many states, for example, exclude personal things such as furniture and clothing. In addition, certain types of property are exempt up to a certain maximum. These exemption limitations indicate that any equity in the property that exceeds the limit is not exempt. The Bankruptcy Court can seize and sell the property, pay off any creditors, grant you the exemption amount, and hold the remainder for other creditors.
If I'm married, how does a bankruptcy work?
You can submit a joint petition if you are married. A joint petition is a single petition filed by an individual and the applicant's spouse. To be eligible for a joint petition, you must be married on the date the petition is filed. Unmarried individuals, companies, and partnerships must individually submit their own lawsuit. If you are an individual with a business, you cannot file a single bankruptcy petition for both yourself and your business; each must be filed as a separate bankruptcy case.
Is there a limit to how many times I may file for bankruptcy?
The time between bankruptcies is determined by the type of prior filing and the type of new filing. If your new file is a Chapter 7, you must wait eight (8) years from your previous Chapter 7 filing or six (6) years from your previous Chapter 13 filing. If your new file is a Chapter 13, you must wait four (4) years from the last Chapter 7 filing or two (2) years after the discharge of a previous Chapter 13 case before proceeding.
Who Can Declare Bankruptcy?
Any individual, partnership, company, or business trust can declare bankruptcy. Furthermore, charity or social groups may declare bankruptcy. Filing for bankruptcy does not necessitate US citizenship.
Do I need to hire an attorney to file for bankruptcy?
You are not required by law to have an attorney. You may file pro se, that is, without the assistance of an attorney. It is, however, incredibly difficult to do so successfully without the support of an attorney.
Hiring a professional bankruptcy attorney is strongly advised since bankruptcy has several long-term financial and legal ramifications.