Bankruptcy Law Q&A - Tri-State News, Weather & Sports

Bankruptcy Law Q&A

Question:    We have a family member that filed chapter 13. Do we have to worry that if something should happen to both my husband and myself that the person involved in a court suit who is asking for $500,000 could receive the money our child would inherit in the next 5 or 6 years?  What do you suggest we do about this?  At this point the $500,000 is part of the Chapter 13 bankruptcy awaiting the outcome of a civil court case.

Answer from Douglas W. Patterson:  Any monies inherited by a debtor within 6 months of filing bankruptcy become part of the bankruptcy estate (paid to creditors).  The debtor is allowed to keep any monies inherited after 6 months from the date of filing.  The crucial date is not when the inheritance is paid, but on what date did the debtor become entitled to receive the inheritance.

Question:  This is not a question about bankruptcy law, just law in general.  How legal are poker tournaments (not for charity) where everyone pays a flat entry fee and the winners split the pot.  If the house gets a portion of the winnings, would that affect the legality?

Answer from Douglas W. Patterson:  I do not know for sure.  I truly believe though that any gambling not at an authorized casino or for charity is illegal.

Question:  Will a person who has some retirement be forced to use their retirement before they can file bankruptcy?

Answer from Douglas W. Patterson:   No. Retirement savings in the forms of pensions, 401ks and traditional IRAs are exempt (meaning they cannot be touched or taken by) your creditors. You also do not have to use them prior to filing for bankruptcy.

Question: My husband and I filed chapter 13 bankruptcy in Jan. 04.  We did this to save our home.  We were behind on payments.  After being off on maternity leave summer 04 and went back to work I then had to have emergency surgery.  We were always on time with our payments until I was off for medical reasons.  So, we were about a month behind and the mortgage company wanted the home.  We made a deal to make post petition payments for 6 months.  We made 5 post petition payments along with our mortgage payment  on time every month.  we only had 1 more post petition payment left and we received letter from their lawyers wanting to lift the automatic stay.  We are due to court in July.  When I tried to make my last post petition payment they wouldn't accept it.  On the website they show where all of our payments have been made so, I don't understand how they can do this??  Can they take our home from us even though we made all payments on time?  Are there any options for us at this point?  Thanks.

Answer from Douglas W. Patterson:  You need to speak with your attorney prior to your July hearing. If you can prove that you have made all of your agreed upon payments, you likely will not lose your home.

Question:  What is the cost of filing bankruptcy and does your name go in the paper of the town you live in?

Answer from Douglas W. Patterson:  The filing fees are $209 for Chapter 7 and $194 for Chapter 13. Chapter 7 attorney fees are generally $500. Chapter 13 fees are paid by the court through your plan payments.

Question:  What are the types of bankruptcy and how do you go about filing bankruptcy?  Also do you have any information on how to recieve a free credit report in Kentucky?

Answer from Douglas W. Patterson:  There are two main types of bankruptcies for individuals: Chapter 7 and Chapter 13. Chapter 7 is a process where a person discharges (gets rid of) their unsecured debts such as medical bills and credit cards. Secured debts, such as home loans and car loans, can usually be kept (reaffirmed) if you are current with your payments. Chapter 13 is a process where a payment plan is developed and approved by the court. The plan lasts for 3-5 years and will pay a portion of your unsecured debt with no interest. Sorry, I do not know where to go for a free credit report.

Question:  We have had one Chapter 13 bankruptcy that was discharged April 2004, in the past few months we have gotten in the situation of having to consider filing again.  How long after the first
discharge do we have to wait to file again?

Answer from Douglas W. Patterson:  You can refile another Chapter 13 immediately. You may not be able to file a Chapter 7 bankruptcy at this time, depending, in part, on what percentage of unsecured creditors was paid in the prior 13.

Question:  I have been past due on two car payments, and I cannot catch up on payments due to financial problems. Yesterday my car got reposessed and what Im clueless about now is whats going to happend now.  Am I still going to owe money for the car which is 9,000?

Answer from Douglas W. Patterson: The bank will sell the car at auction. It is not likely that the auction will cover the full balance of the debt. You will be responsible for any remaining balance.

Question:  When my fiance divorced his first wife, the divorce decree stated that the house was to be hers to live in.  She failed to make her monthly mortgage payments and his name was still on the mortgage.  The bank had already begun forclosure proceedings when he found out she was not making her monthly payments.  He went to the bank, asked to take over payments, but was told to wait while they got it all straightened out.  It took over 8 months from the time he discovered the problem till the time the bank sent him a detailed list of all the backpayments and fees.  One of the fees listed was a $900 bankruptcy fee from when she filed bankruptcy about 6 months into this whole mess.  They had been divorced for over a year when she filed, and hewas not part of the bankruptcy, he did not file.  Can the bank legally make him pay her bankruptcy fees?

Answer from Douglas W. Patterson:  The answer is, unfortunately, yes.  Your fiance's divorce decree did not legally change his liability to the bank for all costs incurred regarding the note and mortgage.  Attorney fees incurred in regards to her bankruptcy are no different than missed payments or late fees.  Your finace is legally responsible to pay the bank.

Question: We filed bankruptcy a year ago and bills we filed on are still showing up on the credit report. we have called the places about this and its still showing up, what can we do about this?

Answer from Douglas W. Patterson: You should write to the credit reprting agencies to dispute the listed debts. Be sure to send them a copy of your bankruptcy discharge. Pursuant to the Fair Credit Reporting Act, the debts must be taken off of your credit report within 30 days of receipt of your letter. Good luck.

Question:  My husband has terminal cancer. We are seeking the simplest method of making a living will. Do we need to consult an attorney?

Answer from Douglas W. Patterson: I would strongly encourage you to meet with an estate planning attorney to assist you in this process. As I always tell people, I am not an electrician, so I did not try to wire my home. When you are dealing with important legal issues (and all legal issues are important), you need an attorney. Good luck.

Question: We owned a business in Madisonville and "sold" the business to a man from Tennessee. The man neve paid and when we started to forclose he put the business into bankruptcy. We put a bid into the trustee and the gentleman that put the company into bankruptcy was allowed to bid against us and he out bid us and got the company free and clear. He has done this to 19 businesses, we were number 20. What are our rights and how can he be allowed to keep doing this over and over. He has done this in Oregon, Tenn and KY. Of course we were not aware of history when we sold the business to him.

Answer from Douglas W. Patterson: Hindsight is 20/20, but you clearly did not take any sort of security interest or personal guarantee on the debt. As such, you were treated as an unsecured creditor. You may be able to file a claim with the bankruptcy estate, and recover some, but not all of your money. Good luck.

Question: If you are sued, and the judge enters a "summary judgment" in favor of the plaintiff, in the amount of $3000.00, plus $200.00 interest, and the judge does not mention owing any additional costs to the plaintiff i.e., court costs, the plaintiffs attorney's fees, etc., how can you then receive a letter from the plaintiff's attorney, stating that you owe an additionsl $500.00 over the amount the judge ordered you to pay?

Answer from Douglas W. Patterson: The prevailing party is automatically entitled to court costs (usually around $130), but not attorney fees unless the fees are specifically set out in the judgment. I would ask to see a copy of the actual judgment. Good luck.

Question: We have been looking in to filing ch 7 bankruptcy. We spoke to an attorney and they said that we had to file a ch 13 because of our income. We are getting ready to move to Florida and my husband will be taking a pay cut. The attorney said that it might be best if we filed there. How long do you have to live in that state to file. I thought that you could file ch 7 if that is what you wanted to do.

Answer from Douglas W. Patterson: You must live in the new jurisdiction for at least 90 days prior to filing in the district. A person is only eligible for chapter 7 if their reasonable monthly living expenses (after bankruptcy) is equal to or exceeds their average monthly take home pay. Good luck.

Question:  I wasnt recently married in October of 03. We have since bought a house together, but all my other bills like car and credit cards are seperate. I'm having problems and do not want my husband to pay for my debt. Can i file BK and re-affirm on the house and my car without it affecting my husband and his credit. The house and car have never been paid late. My husband has great credit and would kill me.

Answer from Douglas W. Patterson: You do have the ability to file by yourself. When determining the type of bankruptcy that is appropriate for you, however, the Court will cosider your husband's income and living expenses as well as your own. Good luck.

Question: While married, Jerry and I filed ch 13 bankruptcy, then we were divorced. The IRS took MY tax check for money they said we owed. I should have only owed my 50%.  How can I get my share of my money back from him?  He is in Florida and it has been two years.  I only get promises of payment.  It never comes.  I need my money to survive on. Can I get garnishment on his wages? Do I have to take him to court? What can I do?

Answer from Douglas W. Patterson: The only way to garnish his wages is to hire an attorney and sue him in Florida. Good luck.

Question:  My mom and dad have recently completed the process for Chapter 13 bankruptcy. They have lost both of their owned vehicles due to recent flooding. They have been totaled. Will the money that they receive from the insurance company for these vehicles be taken for Chapter 13 or will they be able to use this to purchase the 1 or 2 vehicles they lost?

Answer from Douglas W. Patterson:  It is possible that they can use the insuance checks to purchase new vehicles, with the new vehicles being used as substitute collateral. If they wish to do this, however, a special motion needs to be filed with the court as soon as possible. I would encourage them to contact their attorney as soon as possible. Good luck.

Question:  About two years ago, my husband and I filed for bankruptcy. About 6 months later, our van quit on us. We went and purchased a 1998 Windstar with a service warranty with it. We had the van about 3-4 months when the gas tank sucked shut. The dealer we had purchased the van from had gone out of bussiness and so did the company who held the service warranty. We went to the Ford dealer aand they explained to us that they knew that this had happened on other vans. They hadn't issued any recall because it wasn't a "safety" matter. They would not fix the van. We did not have the money at the time for the repairs. We were in desperate need of a vehicle so we agreed to purchase a new van. With the outstanding loan plus the new price, our payment was $650.00 per month. We have owned the car for a little over two years. We have been late on the payment most of the time. The loan amount is far to much and we can't afford to pay for it. If we give the van back and they auction it off, we will still owe probably $10,000. Is there any way we can give the car back and not have to pay the balance of the previous loan off. We can't afford the van but it would be bad to not have it and still have to pay the old loan balance. 

Answer from Douglas W. Patterson:  Sorry, there is no legal way to surrender the van and not have a deficiency balance. Your better option may be a Chapter 13 bankruptcy. Please contact a bankruptcy attorney in order to explore your options.

Question:  How far in the hole should you be when filing bankruptcy?

Answer from Douglas W. Patterson:   Everything is relative. There is no set amount or baseline for how far into debt you have to be to file bankruptcy. We have to look at each situation on a case by case basis.

Question:  I filed Chap 7 and was dischrgd 6/1. I claimed my car as property to be surrendered. From 2/19 till 7/2 they never picked up the car as I was told they would.  Now I get repossession papers in the mail. Can I be held responsible for this? And can they legally claim it as a repo on my CBR's? Can't I just sign the over the title (which is what they originally told me) It is not my fault they did not come for my car!

Answer from Douglas W. Patterson:   They can still pick up your car but they are not allowed to report the repossession as a post-petition action. Good luck.

Question:  If we file Chapter 7 on everything except for the house what are our chances of refinancing our house within a year?

Answer from Douglas W. Patterson: You would be able to refinance, but only at very high interest rates.  It would take about 2 years from your discharge date to qualify for reasonable rates.  Good luck.

Question:  My husband and I filed chapter 7 bankruptcy last year and everything was discharged including our mortgage company in May, we ask for reaffirmation papers from them to keep the house but they did not respond but they are still axcepting our mortgage payments.

Answer from Douglas W. Patterson: As long as you remain current with your mortgage payments, the bank cannot take your home from you.  It is better to have a reaffirmation agreement in place, but not absolutely necessary.  Good luck.

Question:  I have already filed bankruptcy on personal debts in the past year. Now I'm divorced and the bank sold the house and we still owe $30,000.00. They're garnishing my wages for 25% and I have child support payments of $120.00 per week, which leaves me with almost nothing to live on. Can I file bankruptcy again? Please let me know if this is possible.

Answer from Douglas W. Patterson: You are not eligible to file a chapter 7 bankruptcy.  You are eligable, though to file a chapter 13 bankruptcy.  I would encourage you to meet with a bankruptcy attorney to fully explore your options.  Good luck.

Question:  I own a C type of corporation with approximately $ 70-80K of Federal & State taxes due. My outstanding debt to creditors in roughly $10K. The corporation has virtually zero assets, and is currently not operating. Would it be wise to file bankruptcy in my case. Also would I be personally liable for these debts/taxes? Thank you.

Answer from Douglas W. Patterson:   You are personally liable for any unpaid withholding taxes.  As to the other unsecured debts, you are only personally liable if you signed a personal guarantee.  Good luck.

Question:  My sister is divorced. Her ex-husband filed bankruptcy. Now, all of his bills are coming back on her. I have told her that she has to file also. (He has medical bills, the home they had because he could not refinance to get her name off, the total is aroung $100,000!) She does not have the money up front to file. (He does not pay child support either.) Is there an agency out there to help her? Thank you for your help.

Answer from Douglas W. Patterson:   Most bankruptcy attorneys will be willing to set her up on a payment plan that she can afford.  Good luck. 

Question:  My car was recently repossessed. I had made a payment through Western Union for my December and January payments on Thursday, Feb 20 and my car was taken on Sunday morning. My February payment was due on the 20th but I was in my grace period. I spoke to a lady on Thursday before I made the payment and she never mentioned the repossession. She told me to make those two payments and I would be all caught up. Was this lawful for them to still take my car when I was caught up on my payments?

Answer from Douglas W. Patterson:  It is not legal, but since everything was verbal, and not in writing, your case will be very hard to prove.  You should watch to see if the bank immediately cashes your check.  Good luck.

Question:  If you are a business owner and have a 401K plan and the business files for bankruptcy, 1st, should you leave your funds in the 401K 2nd, if you leave it in the plan, can all the maintenance and miscellaneous fees be taken out of our 401 funds?

Answer from Douglas W. Patterson:   The money should reamin in the 401K plan.  The court will administer any miscellaneous and maintenance fees.  Good luck.

Question:  After my divorce in '97 I made some bad choices. those choices left me with about 10 -12,000 in unpaid debt.  I have not encurred any new debt since 2001. Now some of these debts are coming at me. I would really like to pay them, but they are demanding payment right now. My question is, can I fill bankruptsy on these things without hurting my new husbands credit?

Answer from Douglas W. Patterson:   The answer is probably yes.  You can file on your own without your new husband.  I recommend that you meet with a bankruptcy attorney to fully explore your options.  Good luck.

Question:   My wife and I filed ch.13  2 years ago.  I lost the job I was at when we filed and now I'm making less money. Because of less income it's harder on us to keep making the payments and keep the roof over our heads. In fact, it's almost impossible. Can we switch to ch. 7?

Answer from Douglas W. Patterson:   Yes you can, but you need to meet with your attorney to determine what the effect of the conversion will be.  Will you lose assets in a 7?  Are you currnet with the debts you want to keep?  These questions and others must be discussed with your attorney prior to making your decision.  Good luck.

Question:  If you filed a chapter 13 a year and six months ago, can you role it into a chapter 7?

Answer from Douglas W. Patterson: The answer is generally yes, but the most important question is how a conversion will affect you.  Have you completed the goals of the chapter 13?  Will you lose any of your assets if you convert?  Why are you needing to convert?  These are questions that you need to discuss with your attorney.

Question: We recently filed a Chapter 7 (Jan. '03) in Indiana. We haven't filed our tax return yet. Will the trustee take our refund? Thanks

Answer from Douglas W. Patterson:  It depends on how much your refund is.  Two of the chapter 7 trustees take your refund if it exceeds $1,000.  The third trustee takes it if it is greater than $500.  The law states that the trustee is to administer (take) any refund in excess of $100.  Good luck.

Question:  My husband and I are currently separated. We have considered filing bankruptcy to get out from under all of these bills and to start fresh. He is also enlisting in the Army. Should we file for bankruptcy before or after the divorce and should he file before he leaves for the Army? Thank you.

Answer from Douglas W. Patterson:  File before the divorce is complete and before your husband joins the army.  Good luck. 

Question:  If I have a judgment in my favor on a debtor through small clames court in Indiana.Can I get a copy of his or her credit report?

Answer from Douglas W. Patterson:  No.  Only the debtor and a potential creditor with whom the debtor is applying for credit is entitled to a credit report.

Question:  I've been looking for a lawyer so that I can file bankruptcy but my only problem is I recently have fallen into some bad luck with jobs.  I can't keep them because I miss alot of work because my kids are sickly. My question to you is are there any lawyers out there for low income families,  if so who?

Answer from Douglas W. Patterson:  I would suggest that you contact legal aid or legal services for a list of attorneys who provide bankruptcy services for persons who qualify as low income.  I, along with several other attorneys, accept referrals fromlegal aid.  The services, however, are not free.  They are provided at a 50% discount, assuming you meet the financial guidelines.  Good luck. 

Question:  Will the trustee attach our tax refund (about $500) since we just filed for Chapter 7?

Answer from Douglas W. Patterson:  The trustee has a legal right to do so.  As a practical matter, however, trustees normally only take refund checks in excess of $1,000.  Good luck.

Question:  I have been in debt for a while and I work at whirlpool, so I lived to my income. Recently I have been laid off and only draw 200 a week on unemployment and its simply not paying my necessities.  I'm 20 years old and afraid that if I try and find another job I might miss my opritunity to get back at my job. What should I do, what can I do?

Answer from Douglas W. Patterson: I cannot advise you on this issue.  Frankly, I do not know your union proceedures for callbacks.  As a prectical matter, though, you obviously cannot wait too long to take a new job.  Good luck.

Question:  I have about $45,0000 in unsecure debt. And I am thinking about bankruptcy. I have spoken with an attorney, but he beats around the bush. If I file complete, chpt 7- will I loose my home-which I've never been behind on in payments-or will I get to keep my house.  My wife is pregnant with our 4th child and out of work.  I'm 24 months behind with some creditors and one has already summoned me to court in Feb.  I've tried every thing possible to deal with my creditors. I have no other way out because chpt 13 would have payments higher than I can handle at this time.

Thanks Answer from Douglas W. Patterson:  Chapter 7 may be an option, but I would need to meet with you to fully analyze your situation.  Whether you can keep your home in a chapter 7 depends on how much equity you have in your home.  I do not have sufficient information to determine whether chapter 7 or 13 is best for you.  Do not assume you cannot afford a chapter 13 payment.  Please give my office a call to schedule a free initial consultation if you would like more information.  Good luck. 

Question:  I live in Kentucky. My income for 2001 was $14,000, my income for 2002 was $10,500 (part of which was from employment in Indiana). My debts total $27,000 for two credit cards and one high interest (24.395%)loan. I resigned from a $35,000yr job in May 2001 to care for an ill family member. I did not work a full year in 2002 either.  Thus I had to subsidize my income with the credit cards & loan. I resigned from the Indiana job Feb. 2003 as the job was just too overwhelming/not my usual field. My salary was $30,000yr. I am not currently working. Would I qualify for chapter 7 now, or should I obtain other employment first and if I did would I qualify for chapter 7? None of my debts are over-due yet but I cannot continue to juggle them any longer, am not getting anywhere due to monthly interest charges and frankly I am very tired of juggling them as it accomplishes little paydown of the debt. I can't find employment in my field in KY (I am a Social Worker). Also, I had to sell my home in July 2002. I did have equity, which has now been exhausted as I paid off other debts and used the remainder for living expenses. I have been living with a friend since selling my home. I own a car with an additional debt of $2800. It is probably worth $5000-$6000 and I would like to keep it. I have very little else, some personal property and clothing only. I sold a lot in a moving sale...to pay for moving expenses to another city. Any help you can give will be greatly appreciated.

Answer from Douglas W. Patterson:  All of the information you have given me indicates that a chapter 7 would be appropriate for you.  There does not appear to be any reason to wait.  If you currently reside in Kentucky, then you should meet with a Kentucky bankruptcy attorney to fully discuss your options.

Question:  I am thinking of filing bankruptcy. I would like to know which one is best (7 or 13). I want to keep my car, do I have to file on that. What would it cost to file bankruptcy?

Answer from Douglas W. Patterson:  The type of bankruptcy that would work best for you depends upon many factors.  This can only be determined durin a 30 minute free consultation.  You are required to list all of your assets and all of your debts in your bankruptcy schedules.  In either type of bankruptcy, though, you can keep your car by paying the debt either directly to the bank (Chapter 7) or through a plan (Chapeter 13).  Good luck. 

Question:  I have a bankruptcy filed in 2001, i have recently received a copy of my credit report and notice that there are still things on there that i didnt get included in bankruptcy? can i still get them included since it has been almost two years since i filed and was discharged??

Answer from Douglas W. Patterson: Yes you can. You need to reopen your bankruptcy and amend your schedules to add the debts that were left off. There is a substantial fee involved. See your attorney for details. Good luck.

Question:  Can you ever go bankrupt against student loans? If so what is the criteria?

Answer from Douglas W. Patterson: You can only discharge student loan debts under very limited circumstances. Those include if the school you attended closed before you were able to earn your degree, if you are permanently disabled, or if your finances and income are such that you will never be able to repay the debt. All in all, it is extremely difficult to discharge student loans. Good luck.

Question:  If you filed a 13 bankruptcy and had two mortgages and a lien on your home and the value of your home was less than the two mortgages, and the # 2 mortgage did not file and the lien was considered and # 2 by the bankruptcy 6 month report. Can you explain to me if I need to write the bankruptcy judge and advise him about this fact or is it take care of in the filing of the bankruptcy when recorded in the chapter 13?

Answer from Douglas W. Patterson:  You need to advise your bankruptcy attorney immediately to discuss your situation. The fact that the second mortgage is not being paid could be good news or bad, depending upon your particular circumstances. Good luck. 

Question:  My mother received a summons yesterday for a very old credit card bill she has not paid. She has been homebound for the last five years and is middle range alzheimers. We knew nothing of this bill. She has limited income, social security only, but she owns her home. Would bankruptcy be an option, or what could we do to get this resolved? She has no savings, so she can't pay it off. We are trying to keep her from going into a nursing home, she does stay by herself with help. Can they take a part of her ss check?

Answer from Douglas W. Patterson:  Bankruptcy may be appropriate, but many factors come into play: Does she own real estate? What is the value of her assets? She should meet with a bankruptcy attorney to explore her options. Her social security benefits cannot be garnished. Good luck.

Question: What happens if you are in a chapter 13 bankruptcy and my 1991 pontiac grand prix is totalled in an accident?

Answer from Douglas W. Patterson:  Is there a loan on the grand prix? If so, the insurance proceeds need to be paid over to the trustee, at least up to the balance of the loan. Talk to your paralegal about your situation.

Question: Can I be sued for a bank note which I cosigned with my husband (at the time ), when in my divorce the judge ordered the truck and all debt to him. Doesn't the bank carry insurance for this sort of thing. He was killed in the truck and it was totaled we had been divorced at the time. I did not know the insurance had been cancelled for nonpayment. Please respond I need help.

Answer from Douglas W. Patterson:  Unfortunately, the bank (or any other creditor) is not bound by the terms of your divorce decree. If you signed the note, then the bank has the legal ability to look to you or your ex-husband's estate for payment. If you cannot afford to pay this debt I would suggest that you meet with an attorney to discuss your options. Good luck.

Question:  I have just been served with a forclosure summons. Will filing chapter 13 help save my home. I'm a single parent with 3 kids.

Answer from Douglas W. Patterson:  Chapter 13 is the best option for saving your home. I would strongly encourage you to meet with a bankruptcy attorney at your earliest convenience to explore your options.

Question:  My husband filed bk on bad checks. Can the companies still press criminal charges if he doesn't pay the money?

Answer from Douglas W. Patterson:  Yes, but if the dollar amount of the checks is less than $800, then it is very unlikely that criminal charges will be pressed.

Question:  If you have a business and you have a business credit card and your company files bankruptcy, does that wipe out your obligation even though you personally guaranteed this card or do you have to file both company and personal bankruptcy?

Answer from Douglas W. Patterson:  No. A business filing does not release guarantors from their personal liability for guaranteed debts. You may need to consider filing bankruptcy for both.

Question:  This is more a billing question but I hope you can help. Can a hospital sell your account to an account management firm that then proceeds to charge interest on outstanding balances?  I was under the impression that interest charges had to be disclosed up front before charges were incurred. Thanks.

Answer from Douglas W. Patterson: You are correct in that if an entity wishes to charge interest in excess of the statutory interest rate (8%) then the rate needs to be disclosed at the time you sign up for the services. It is very likely, however that the paperwork that you signed when incurring the medical services included higher interest rates in the fine print. Good luck.

Doug Patterson Question:  After filing bankruptcy, when can a family apply for a home mortgage loan? We would be first-time buyers and live in Illinois.

Answer from Douglas W. Patterson: You can legally apply at any time. As a practical matter, you will not qualify for decent interest rates until at least 2 years from the date of your discharge. Good luck.

Question:  What does it cost to file for bankruptcy if you have no other way out?

Answer from Douglas W. Patterson:  It depends on what type of bankruptcy you file. Chapter 7 normally costs $700. Chapter 13 costs more, but payment plans are usually offered. Good luck.

Question:  We are currently in a chapter 13 bankruptcy, we are starting to get behind on bills do to doctor bills again. Is there anyway that we can add the medical bills into our chapter 13 bankruptcy?

Answer from Douglas W. Patterson:  Yes there is. Make an appointment to meet with your attorney or paralegal to discuss your options.

Question:  I have a corporate bond in Conseco who analysts are predicting will go bankrupt.  If they do, will there be any chance of getting any money back.  How does it work?  Thanks.

Answer from Douglas W. Patterson:  If Conseco files for bankruptcy, there is very little chance that you would recover anything.  As a bond holder, you would fall at the end of the line as far as priority of getting paid.  Only shareholders have less priority than bond holders.  Good luck. 

Question:  I declared b/k which was final in May 2002. Can a company still garnish my wages? A company garnished my wages from my payroll check.

Answer from Douglas W. Patterson:  Not if the debt was listed in the bankruptcy and a notice of the bankruptcy filing was served on the court from which the judgement arose and your employer.  This does not apply to garnishments for student loans and taxes.  Check with your bankruptcy attorney to see what can be done.  Good luck.

Question:  I never recieved my discharge papers from the BK filed in 5/97. How would I obtain copies? I am now buying a house and need to provide the discharge papers.

Answer from Douglas W. Patterson:  The quickest and cheapest way is to contact the attorney who filed the bankruptcy for you.  If that doesn't work, you can get a copy from the bankruptcy clerk's office at the court where you filed.  The clerk's office, though, charges a very high retrieval fee for closed files.  Good luck.

Question:  I have a couple of questions - We filed Chapter 13 last year. Our mortage is included in this. My husband may possibly have a chance at a job in northern Indiana. What would be the best thing for us to do as far as our home is concerned? Would switching to Chanper 7 be an option? We would not be able to afford to make the payments we are currently making until we sold it and also have living expenses in another city. Also, what is the average amount of time until we would be able to purchase another home?

Answer from Douglas W. Patterson:  Chapter 7 may be an option, but I would suggest that you meet with your attorney to fully explore your options.  You may want to see if selling your home would be practical.  If you surrender your home, you will have to wait at least 2 years before you will qualify for a home loan.  good luck.

Question:  How long does a repossesion of automobile or any type of repossesion show or stay in your credit report?

Answer from Douglas W. Patterson: 10 years.

Question:  My husband filed for b/r earlier in the year, without my name attached. We kept our house and cars, however, we are considering letting the house go back to the bank because it is such a struggle on us. My name is on the mortgage - how does this effect me as his wife and a person on the mortgage? Thanks for your time.

Answer from Douglas W. Patterson:  The fact that your husband has recently filed a bankruptcy has no affect on the situation as it pertains to you (except that if the bank gets less for the house at a sale than what is owed, your husband cannot file a chapter 7 bankruptcy to get rid of the deficiency balance).  When you "give back" the house to your bank, it will sell your home at foreclosure sale.  It is possible that the house will sell for less than what is owed.  If this occurs, the bank will then attempt to collect the remaining balance directly from you and your husband.  If you let the house go back, it will be very difficult for you to get financing for a new home for the next several years.

Question:  Is there such a thing , as "medical bankruptcy".

Answer from Douglas W. Patterson:  No, there is not.  When you file for bankruptcy, you must list all of your debts.  Unsecured debts are normally discharged (gotten rid of).  Secured debts such as a car loan or mortgage may either be kept (reaffirmed) or surrendered.

Question:  I owe alot of money in taxes to the IRS and to the state, and I am unemployed.  I recently got married and had a child.  I would like to know what would be the best thing to do in my position?

Answer from Douglas W. Patterson:  It depends on what your other debts are and how old the taxes are.  You should meet with a bankruptcy attorney in person to fully discuss your options. 

Question:  I don't fully understand.  I can file bankruptcy and be relieved of paying any credit card debt but, still be able to keep my house and vehicle?

Answer from Douglas W. Patterson:  Most of the time, the answer is yes.  It depends on several factors including the amount of equity you have in your home and car, your income and whether you are current with your car and mortgage payments.  I would encourage you to meet with a bankruptcy attorney to explore your options. 

Question:  My wife and I filed Bankruptcy (Chapter 13) in February 2002. I run an entertainment business from home and she is a teacher. Our attorney never suggested that we file our income taxes before we file to see if our refund would cover the amount we were delinquet. Now- the IRS has sent our refund of $3500 to the Trustee who says they are keeping it because it constitutes (Additional Income). We've tried contacting our attorney- but he always seems to be in a meeting, on vacation, out of the office, or somewhere else and have not returned any of our calls (it's been nearly a month). We were not told that the trustee could keep the money prior to this and can not find it anywhere in the Bankruptcy Code (online). It took my business a few months after the bankruptcy to pick up and get to the level our plan set forth. So far we are around $4500 short of the plan amount. We were counting on that money to pay our back utilities and household bills which our attorney suggested not to include in our bankruptcy. So now I find myself using money I should be using for Advertising and Marketing for my business to keep our bills caught up. I've had to cancel music subscriptions, take down my website, not do maintainence on business vehicle and equipment, and other things because of this money situation. I feel the Trustee has made it impossible to reasonably conduct my business affairs by keeping this money. Is there anything we can or should do to get this money? Where in the Bankruptcy code is this rule?

Answer from Douglas W. Patterson: Tax returns and how they are treated in chapter 13 plans are a matter of local practice.  In Indiana, post-petition refunds are rarely included in the plan.  It is my understanding that in Kentucky, post-petition refunds are almost always turned over to the trustee.  I would suggest that you schedule a meeting with your attorney to discuss your options. 

Question:  My husband and I have filed for b/r and were making payments to the trustee, but somehow we did not know it was only to catch-up back payments, and now we are behind again. What is giong to happen to our house and car.

Answer from Douglas W. Patterson:  I do not know where you filed, but in Indiana, unless your vehicle payment is a lease, your chapter 13 payment does include your car payment.  If your regular monthly mortgage payment was not included in your plan payment, the mortgage holder will file a motion with the bankruptcy court to allow it to start foreclosure proceedings in state court.  You and your attorney may have an opportunity, however, to negotiate a payment plan with your mortgage holder.  I would recommend that you call your attorney's office to discuss your options. 

Question:  Why is it listed in the paper under records: liabilities $110,000 and assets $111,000. If their assets are more than their liabilities, how can they file bankruptcy?

Answer from Douglas W. Patterson:  Pursuant to state law, people are entitled to protector exempt certain amounts of property by type.  A husband and wife, in Indiana, are allowed to protect up to $15,000 of equity in their home.  Pensions and 401K's are entirely exempt.

Question:  I'm 25 years old and have about 10,000 in credit card debt, I've been seriously late on a lot of payments the past few years and am currently having my wages garnished for a student loan I can't afford to pay. I do have a car loan and keep payments current on it, is bankruptcy an option for me and if so would I still be able to keep my car?

Answer from Douglas W. Patterson:  It is most likely that you will be able to keep your car.  Your student loan, however, cannot be discharged.  I would strongly encourage you to meet with a bankruptcy attorney to fully discuss your options.

Question:  I am contemplating filing bankruptcy, as I have $10,000 in debts. Will this effect my leased vehicle? I do not want to lose it.

Answer from Douglas W. Patterson:  As long as you are current on your lease payments at the time you file your bankruptcy, you will not lose your vehicle. 

Question:  My wife and I have been married for over two years now. We are only 22. When younger, we incurred many debts. All the cards are in my name with her as an authorized user. The car that we own is in her name. We are about 20,000.00 in debt. We could not aford the payments before, but now she is pregnant. She is unable to work. She is afraid to file because we have good credit but don't make enough right now with the economy going the way it is. I am aware that I can file alone. I have one store card with her father. Is it okay to take her name off of the cards before I file. And will this affect my father in law in any way?

Answer from Douglas W. Patterson:  If your wife is only an authorized user, there is no reason to remover her as an authorized user prior to filing.  As to the card with her father, if you do not reaffirm the debt, the cardholder can look to him for the payment.  Otherwise, there will be no affect on him.

Question:  My grilfriend filed for a divorce last Sept. They sold their home and she got an apartment. This past march, her husband filed b/k feb.2002. They sold their home an got some money from the sale ($400.00)They recived a refund on their taxes. Her attorney says they have to wait a few months on account of this money.  Their b/k attorney has not filed their papers yet.  How long do they have to wait before it can be filed. Can the debter garnish their wages while they are waiting for this get over with? If so how long do they have to wait? Also when they do this,can you recover what they took out of her payceck?

Thank you Answer from Douglas W. Patterson:  If they received more than $1,000 on their tax refund, then they should wait 60 days prior to filing and maybe more depending upon what was done with the money.  In the interim, your girlfriend's wages can be garnished (but only after a creditor obtains a judgement).  Any wages garnished will not be returned after the bankruptcy is filed.

Question:  My car was just repossesed. My husband and I had filed bankruptcy prior to this. He left said he wanted a divorce I could no longer make the payments on the bankruptcy, it was dismissed and my car was taken. I want to know will I be sued for the amount owed on the car?

Answer from Douglas W. Patterson:  More than likely you will be sued for the remaining loan balance after the car has been sold at auction.  You should meet with a bankruptcy attorney to explore your options.

Question:  Once you file bankruptcy on a credit card company and then they offer you a new credit card (5 years later) if you accept can they add the previous amounts onto the new credit card?

Answer from Douglas W. Patterson:  No, they cannot.  Good luck.

Question:  My husband and I filed ch. 13 bankrupcy on 5-31-02. We have not yet been to the meeting of creditors, it is next month it is scheduled for mid-july. Both of our names are on this house and bankrupcy. However, my question is, regarding divorce and bankruptcy.  I want to file for a divorce,but we have 3 small children, and I do not work, am in college(3.5 average) and at home with the kids. My husband is not financially responsible and also is having an affair, one of many. I want a divorce, but have signed three yrs. of bankrupcy arrangemnts with him now, and do not know if I should wait untill that is over with and then file or file now before the bankrupcy goes final. I will not have a good enough income for two more yrs. to make the payments, but my parents have said they would pay it for me, since they can afford to and since they paid the down paymnent on the home and also over $7,000 in mortgage paymnents two yrs ago, to avoid a foreclosure. Please advise . Thank you.

Answer from Douglas W. Patterson:  I would strongly encourage you to meet with your bankruptcy attorney to explore your options.  If you decide to pursue a divorce now, you may be able to modify your chapter 13 plan payment due to a change in your circumstances. 

Question:  I had a car that was recently totalled in an automobile accident and I was uninsured. I was the only party in the accident and I now owe approximately $18,000 for a vehicle that I can't drive. It will be impossible to pay for this automobile and buy another one for my family. What are my options?

Answer from Douglas W. Patterson:  It sounds as if a chapter 7 would work best for you.  In a chapter 7 bankruptcy you could discharge your debt on the car.  I would suggest that you meet with a bankruptcy attorney to explore your options more fully.

Question:  I want to know about bankruptcy and how to file. What fees are involved and how much are we looking at? Thanks. 

Answer from Douglas W. Patterson:  There are two main types of bankruptcies for individuals:  Chapter 7 and chapter 13.  For most people (about 75%), chapter 7 is most appropriate.  The filing fee in a chapter 7 is $200 and the attorney fees are normally $500.  You should meet with a bankruptcy attorney to determine what type of bankruptcy is most appropriate for you. 

Question:  We are considering bancruptcy, because we have a double wide trailer that we cannot sell. We lived in it for 5 years, then have been leasing it, but can't get responsible tenants. What can we expect from the mortgage company in a bancruptcy? When do we advise our tenant. Is there a problem to be considered? Also, Is there any way to discharge student loans for college?

Answer from Douglas W. Patterson:  If you wish to wipe out the debt on your mobile home, the mortgage holder will take it back about 45 days after you file bankruptcy.  Your tenant would be advised by the court at the time you file bankruptcy unless you have told them previously.  Your tenant would have no recourse against you, but would have the ability to negotiate with the mortgage holder to buy it.  As to student loans, if you are employable, it is nearly impossible to discharge student loan debts.

Question:  I co-signed on a loan with my son for his car. He lost his job and I was laid off my job. I had been making the payments with my unemployment checks but they are running out now and I can't afford it any longer. Is it better to let the car be repossed or after it is repossed to file for bankruptcy? I own a home a would not want to lose it. Which chapter is the best?

Answer from Douglas W. Patterson:  It makes no difference whether the vehicle is repossessed before or after bankruptcy.  The answer to your second question depends on how much equity you have in your home.  You should meet with a bankruptcy attorney to explore your options.

Question:  If you have a vehicle repossed, how long after it is repossed can you attempt to purchase a another vehicle, or can you purchase another vehilcle by law?

Answer from Douglas W. Patterson:  There is no law which prohibits a person from immediately purchasing another vehicle.  As a practical matter though, once the repossession is reported to the credit bureau, it will be very difficult to obtain reasonable financing terms without a co-signer with good credit.

Question:  Our mobile home is paid for and so is our car. Credit card debts are $10,000 for medical and precriptions. If we file bankruptcy, will we lose our home and car? We are 70 and 65and ss income is 1200/mo.

Answer from Douglas W. Patterson:  It all depends on how much your mobile homeand car are worth.  A married couple is allowed to exempt (protect) up to $8,000 in personal property.  If your mobile home and vehicle are worth more than $8,000 you should meet with a bankruptcy attorney to see if chapter 13 is appropriate.

Question:  I have filed bankruptcy back in 1995 and was under the impression that 7 years was the time frame that it would be listed on my credit report... I now have learned that a chap. 7 stays on the credit report for 10 years. Has there been a new law that changed the extent of time listed in a credit report and if so can I dispute being that my 7 years (of bad luck) have come to an end?

Answer from Douglas W. Patterson:  Prior to about 1992, a bankruptcy filing stayed on your credit report for a period of 7 years.  In about 1993 it was changed by law to 10 years.  Sorry, but there is nothing you can do but wait out your ten years.

Question:  I recently filed chapter 7 and included my house and 2nd mortgage in the bancruptcy. The house was in my name only, but the 2nd mortgage was in my name AND my ex-wife's name. The house will be taken by the mortgage company. Without a house to secure the 2nd mortgage, can the 2nd mortgage company still go after my ex-wife, or is the loan resolved in the bancruptcy? If the 2nd mortgage company DOES go after my ex-wife and she chooses not to pay, what can the company do other than mark her credit report?

Answer from Douglas W. Patterson:  If your ex-wife signed the note secured by the second mortgage and the note is not paid from the sale of your home, then the second mortgage holder can go after your ex-wife to collect the unpaid balance.  They can sue her and garnish her wages if they chose to do so.

Question:  What happens to my 401k in bancruptcy?

Answer from Douglas W. Patterson:  401k's, pensions and retirement funds are generally exempt, which means that they cannot be taken away by the court or your creditors in a bankruptcy.

Question:  My vehicle was just recently reposessed after missing one payment (payments due every two weeks) I was not given any notifaction that my vehicle was going to be reposessed, they just told me I was late on a payment.  Now they are saying that my loan for the vehicle had changed hands from the bank to the actual car company prior to the reposession and that their policy is after 7 days late they can reposesses the car.  They changed the policy without my knowledge and took the car without notifaction, now they are trying to charge me a $500 repossesion fee along with the missed payment. I feel that they should have notified me prior to the reposession.  What are my options at this point?

Answer from Douglas W. Patterson:  You will need to red the written terms of your contract to determine what your rights are, if any. 

Question:  Are there any advantages to a chapter 13 as opposed to a chapter 7 in regards to rebuilding credit?

Answer from Douglas W. Patterson:  Not really.  While there should be, most banks look at every bankruptcy as the same. 

Question:  In 1993 my parents split up and filed for bankrupcy and divorce. My father is now thinking of filing bankrupcy again because unemployment security is requiring him to re-pay all of his unemployment he received 3 yrs. ago. His monthly payments for the past 2 years haven't even touched interest. But a few month's ago my brother bought a newer truck and it is in my fathers name with my bro. as a second name. Could he loose the truck? I told him to re-affirm it, but is there a limit on how much can be re-affirmed? His own car will be paid off in 3 wks. could he loose his own, which bluebooks at approx. $1200. for private sale.

Answer from Douglas W. Patterson:  It is unlikely that your father would lose anything if he filed bankruptcy.  On the other hand, he probably cannot discharge the overpayment of bene, fits.  I would suggest that he meet with a bankruptcy attorney to fully discuss his options.

Question:  If someone wrote you a bad check and you had to pay for it through small claims court because they wouldn't cover it and then they send you another check to cover the first one and it is bad to. How much can i sue them for?

Answer from Douglas W. Patterson: You can ask the court to award up to three times the amount of the last bad check. 

Question:  My wife and I filed chapter 13 last year and are doing really good now thanks to it. The vehicle I use to drive to work daily is giving me many problems. Is it a possibility to get a new vehicle while finishing my chapter 13 either new or used. (something dependable) If so, how should we go about it?

Answer from Douglas W. Patterson:  You can purchase a new or used vehicle while in chapter 13.  You do need approval of your trustee prior to financing the new vehicle.  Contact your trustee for a list of, banks that routinely make car loans to persons in Chapter 13. 

Question:  Will you lose your home and vehicle if you file bankruptcy? We have lived in our home for approx. 13 yrs and both my hu, s, band and myself are on Social Security.

Answer from Douglas W. Patterson:  The answer to your questions depends on how much equity you and your husband have in your home and vehicles.  Each state has its own set of exemptions (the laws that govern what you can protect from creditors in bankruptcy).  You should meet with a bankruptcy attorney to discuss your options.

Question:  My ex wife is now filing bankruptcy of $40,000 in debt. The thing is, between her and her "finance" within the last year bought 3 , new motorcycles, a house, 2 cars, a computer, etc. etc. Because they are not married, have put all DEBT in her name and all ASSETS in his name can she really get away with this and KEEP everything?

Answer from Douglas W. Patterson:  She can unless someone can prove that she helped pay for the assets that are in the new husband's name.  If she is trying to discharge debt that she owes to you, you should see a bankruptcy attorney to discuss your options.

Question:  If I have a judgment entered against me and file bankruptcy, will that judgment be discharged?

Answer from Douglas W. Patterson:  In most instances, yes.  It depends on what the judgement was for and how much equity you have in real estate.  98% of the time, the fact that a debt has been reduced to a judgement does not prohibit the debt from being discharged. 

Question:  After filling bankruptcy usually how long before any one would give us a loan? also I have heard someone ask if the bankruptcy had been discharged. What does that mean exactly?

Answer from Douglas W. Patterson:  Persons who file for bankruptcy can usually file for loans within a few months of the bankruptcy discharge.  For the first couple of years after the discharge, the interest rates on the loan would be high.  After two years, assuming that the person has kept their post-bankruptcy credit record perfect, the person could expect to obtain loans at good rates.   The discharge date is the date the bankruptcy court issues an order wiping out any debts that the debtor did not wish to keep (except for certain debts such as child support and most taxes, which are not dischargeable).

Question:  Can I get a copy of credit report of a debtor in the capacity as a judgement collector without a supenoa? (if not can I do this myself?) I have a small claim's court judgement against this person.

Answer from Douglas W. Patterson:  No you cannot.  The only way to legally obtain a credit report from someone is if they apply for a job or apply for credit.  As a judgement creditor, though, you can have the person apear in court and provide you with a list of all of their assets and debts.

Question:  My fiance got a divorce about a year and a half ago.  In the divorce papers it states that the home and vehicles that were in both of their names, need to be switched over to hers and she pays the payments. The problem is, that she has quit where she was working and gotten a new, much lower income job and hasn't switched the names over. She has been late on both payments numerous times. Is there anything we can do besides going to court over it?

Answer from Douglas W. Patterson:  Unfortunately, there is not much more that you can do.  The divorce decree does not affect the original lender's ability to pursue your fiance for the unpaid debt.  It is also very likely that she could file bankruptcy on those debts, leaving your fiance holding the bag.  Divorce can be a very expensive adventure.  Good luck.

Question:  I have been advised/told that if I would go ahead and file for a divorce and the divorce court judge decided that my husband owed me money for various debts such as credit cards, money he stole and property damages he caused and he then LATER f, iled bankruptcy that the amounts that had been determined he owed by the judge in the divorce could be dismissed/discharged by the judge in the bankruptcy court. So because of this I am waiting to file for divorce. Is this true can the judge of one court overrule what was ordered b, y an, other judge of a di, ,, fferent c, ourt , , , and type of case?

Answer from Douglas W. Patterson: Yes, this is true.  If a divorce court judge were to order your husband to pay certain debts and to hold you harmless as to those debts and later file for bankruptc,,,, ,, , , , , , , , ,, , , ,, ,, , , y, , b, an, kruptcy laws could allow your husband to discharge those debts, depending on what type of bankruptcy he filed.  If he does file bankruptcy and owes you money, you should meet with a bankruptcy attorney to review your options.

Question:  If I file, and have very little in possessions, no car, no job, just S.S. live with a friend, my friend owns everything. does the court come into the home to inspect or verify what is there.please advise.

Answer from Douglas W. Patterson:  The court does not come into your home to appraise all of your belongings.  You are required though, to list in detail all of your belongings with the present value of those items.  You would sign an affirmation under penalties of perjury that your statements are true and accurate.

Question:  My husband and I filed a ch. 7 in 1993 and had a lot of tough times since. We are condidering another bankruptcy, but I'm not sure. How bad will our credit be if we file again? I really want a house (we are renters) and we don't qualify now, so how muc, h worse can it, be? Also, my husband owes back support, can that be discharged? And do we just pull our, credit report and file everything that', s, g, one in since our last bankruptcy?

Answer from Douglas W. Patterson:  Another bankruptcy will look very bad on your credit report, at least until 2004 when your prior bankruptcy is removed from your credit report.   Your husband cannot discharge back child support.  Without sounding judgemental, you and your husband need to closely examine what has caused you to be in a bankrupt situation since your prior bankruptcy.  Is it something that can be avoided?  Maybe not.  But I can assure you this - until you determine what is creating your financial difficulties, you will be seeing a third bankruptcy before you see a home.  I would strongly encourage you to meet with a bankruptcy attorney to discuss your options and see if you can improve your financial situation.  I wish you and your husband the best of luck.

Question:  I've recently gone thru a divorce and my ex-husband ran up credit cards totaling $10,000.00. The Domestic Commissioner has odered that I have to pay one-half of these. My son and I are living on only maintenance and child support. I can't afford to pay this debt and be able to provide a home for my child. I am unemployed and in poor health. Will I need to file bankrupcy and will I be able to keep my home. I live in Kentucky so I'm not sure if the laws are the same. I feel as if I've been dealt a raw deal. I would appreciate any information that you could give me.

Answer from Douglas W. Patterson:  I am sorry that you are faced with such a difficult situation.  Bankruptcy would likely allow you to discharge your unsecured debts (the credit cards) and reaffirm (keep) your home.  I would strongly encourage you to meet with a bankruptcy attorney to fully discuss your options.

Question:  Can a person receiving foodstamps and W.I.C. file? After a forclosure who and when would we receive the debt we owe? Nobody bought the house at sheriffs sale. How long after filing do the lenders require the collateral, ? At the time of filing? Or after the 100 days? If there are several secured loans with the same bank can we keep one loan if needed?

Answer from Douglas W. Patterson:  This is definitely the most questions, in the shortest amount of space I have ever seen.  First, yes you can receive food stamps and WIC and file bankruptcy.  I hsave never seen or heard of a sheriff's sale where no one placed a bid.  I think if you look a the record closely, you will find that your bank bought the house at sale by bidding in all or a portion of its judgement.  Secured debt that is surrendered is normally returned between 30-60 days into bankruptcy.  The issue of whether you can keep one secured loan with a bank and discharge other debts with the same bank depends on whether the loans are cross-collateralized.  This can only be determined by examining the loan documents involved.

Question:  How long do you have to wait after using a credit card to actually file this credit card. Is there a cap on what you can claim on your bankruptcy as far as a credit card goes?  The reason I ask is that I have made several purchases on a credit card and was just notified of a creditor claiming that they were going to sue on an outstanding old debt. Had I known this I would not have charged on this credit card now that it is clear to me that I am going to have to file.

Answer from Douglas W. Patterson:  There is no limit as to how much credit card debt one can have and file for bankruptcy.  Generally, one should wait 90 days from the last time significant charges were made on the card before filing.  Otherwise, the credit card company could object to your ability to discharge your recent charges.  I would encourage you to meet with an experienced bankruptcy attorney to discuss your options.

Question:  My ex-husband and I divorced in 1999. He incurred medical bills during our separation and says he is filing bankruptcy on these bills. If he does will I be notified as to the court date so I can have my say in court as to why he should not be allowed to file on these debts. If he files these debts will come back on me. Will the court notify me? I am now remarried and have paid over $7000 in debt from that marriage. I want my say in the bankruptcy court. Thank You.

Answer from Douglas W. Patterson:  If your divorce decree required your ex-husband to pay these medical bills and to hold you harmless from them, then yes, you will receive notice of his bankruptcy filing and you will have an opportunity to raise objections.  This is not an easy or simple process, however, and I would strongly encourage you to meet with an experienced bankruptcy attorney to discuss your options once you receive a copy of his bankruptcy notice. 

Question:  My 21 yr old granddaughter entered into a relationship that became abusive and controlling; because of this, she lost her job, had her car repossed, and had charges placed on her credit cards. She has no assests except her clothing; she is currently staying with a relative to escape the person she was involved with and is receiving daily mail from her creditors.  She needs to file b/k. How does she go about this and what chapter should she file under? Thanks!

Answer from Douglas W. Patterson: Your granddaughter should immediately schedule a free initial consultation with a bankruptcy attorney.  From what you have told me, it sounds as if chapter 7 is most appropriate for her situation.  She would most likely be able to discharge all of her debts but not lose any personal property. 

Question: Our debts are about $10,000 IF WE TAKE BANKRUPT will it wipe our slate clean or will they make one monthly payment we can pay on?  Also our car is paid for can they take it?

Answer from Douglas W. Patterson:  The answers to your questions depend on how much you make and how much your vehicle is worth.  As a general rule, if yuor household has less than $3,000 per month take-home income, then chapter 7 is most appropriate and you are not set up on a payment plan.  As to your vehicle, you are allowed to exempt (protect) equity in personal property of $8,000 for a husband and wife.  I would encourage you and your spouse to schedule a free initial consultation with bankruptcy attorney to explore your options.

Question:  Does a ch.7 stay on your credit report for the whole 7 years and then another 10years after the 7years? After 7years will a creditor be able to tell you filed bk?

Answer from Douglas W. Patterson:  Any type of a bankruptcy you file will stay on your credit report for a period of ten years after your discharge date.  The discharge date in a chapter 7 usually occurs 100 days after the filing of the bankruptcy. 

Question:  After filing for bankruptcy and receiving your discharge notice, can the creditors that were discharged continue to report whatever they want to on your credit report? My debts were discharged in 1999, and I have a creditor that keeps reporting as a profit and loss writeoff instead of a discharge due to bankruptcy. At this rate, I will never get my credit rebuilt.

Answer from Douglas W. Patterson:  Your bankruptcy discharge should be the only thing that appears on your credit report (as to discharge debts).  You have the legal right to write to the credit reporting agency and demand that it remove any evidence of debts existing prior to your discharge.

Question:  I am a single male considering bk. I share an apartment with another single male. Will this affect my bk? Will his income and debt beconsidered as well?

Answer from Douglas W. Patterson:  Your roommate's income and debt will not be considered, but to share living expenses, such as rent, food, utilities, will be.

Question:  I am going through a divorce and my husband keeps threatening bankruptcy. I do not want to do this so my question is; Can he file without my permission on debts that are in both of our names? Thanks for your help.

Answer from Douglas W. Patterson: Yes he can.  A married person can file with or without their spouse.

Question:  Is there any kind of action taken against someone who files bankruptcy but gives false information?

Answer from Douglas W. Patterson:  Yes, there is.  The information is signed under penalties for perjury.  If you are aware of major discrepancies, this information should be reported to their bankruptcy trustee.  

Question:  My son got a divorce a year and a half ago. His ex got the house which was in his name. She won't make the payments on time and it is affecting his credit. He is considering bankruptcy. He doesn't own any other property excepted a leased car. Can he still by another car after filing. Will she lose the house?

Answer from Douglas W. Patterson:  A person is generally able to finance a purchase of a car one year after the completion of his/her bankruptcy.  If your son choses to file bankruptcy, this would not likely cause his ex-wife to lose her home.

Question:  I had lent a friend $500.00 and he wrote me a check to be cashed 30 days from the day he borrowed the money, within 3 week of letting him borrow the money he told me he was filing bankrup, tcy. What can I do? Can he file on the check he wrote me?

Answer from Douglas W. Patterson: While your friend can (and must) list you as a creditor in his/her bankruptcy, you do have options to contest the discharge of this debt.  I would try to cash the check. 

Question:  I will be filing Ch 7 soon. Before I could come up with the cash I have had a couple court cases brought against me. I have 1 wage garnishment. Before I was placed on the 2nd one the judge warned me that my employer can use this as terms for termination. Is this true?

Answer from Douglas W. Patterson:  No.  While a reason for temination is always difficult to prove, a garnishment is not legal grounds for termination.

Question:  If you are married can only one person go to an attorney file or does it effect both husband and wife?

Answer from Douglas W. Patterson:  There is no legal requirement that both spouses file.  Unless you are recently married, though, it usually makes sense for both spouses to file together.  I would suggest that you and your spouse schedule an attorney to explore your options.

Question:  When you file for any kind of bankruptcy can the creditors take what you have put up for collertal?  This is like jewelry,household items,cars,ect...

Answer from Douglas W. Patterson:  Yes, if you do not reaffirm, or keep, your secured debts, the secured creditor has the legal right to retrieve its collateral.

Question:  What happens when you file B/K on past due taxes? Can they make you sell tools and personal belongings?

Answer from Douglas W. Patterson:  The rulke on taxes is this:  You cannot discharge income taxes for the last three years so long as the returns have been timely filed. (The three year discharge rule does not start to run until the returns have been filed).

Question:  What is this new law that affects your tax return after filing bankruptcy?

Answer from Douglas W. Patterson:  There is no law regarding tax refunds and bankruptcy, whether the refund is received before or after the bankruptcy filing.

Question:  Five years ago, I sold a house. The people I sold it to wrote a promisory note to me for the downpayment. They were to pay it after receiving an insurance payment. Before they paid in, full, they filed bankruptcy, chapter 7. The debt has since been discharged I've just received a summons. Their present mortgage holder appears to be foreclosing on their house. The summons lists 3 other financial companies which they owed money to and the state and our personal promisory note as defendants. I am unsure as to what this summons means. The company is not asking me for any money, are they? But rather notifying me that if any money is recouped from the sale of the house they are first to get it? What is my responsibility to this summons?

Answer from Douglas W. Patterson:  You have no duty to respond at all to the summons.  If you fail to do so, your interest in the real estate will be wiped out and you will not receive any money from the sale of the home.  As such, it is in your best interests to file a written response to the complaint.  Your answer should set forth the amount you are owed and the date your lien was recorded.  The complaint is not asking to obtain money from you, instead, the complaint is asking the court to establish the priority of the liens on the real estate.  I would encourage you to consult with an attorney on this issue, but I do not recommend spending more than a couple of hundred dollars to protect your claim. 

Question:  I married a lady who has quite a few bills,all of which are in her maiden name.  If she files BK,can they pull me into her BK or make me have to pay anything?

Answer from Douglas W. Patterson:  The answer to your question is generally, no.  If your wife files for bankruptcy, you will not have to file with her and it is unlikely tht you would have to pay anything as part of her bankruptcy.  There are exceptions to these general rules and I would strongly encourage you and your wife to meet with a bankruptcy attorney to fully discuss your options.

Question:  In 1998 my husband filed for divorce and ch.7 bankruptcy leaving me with all the bills-therefore I was forced to file ch. 7.  Do you have any tips on rebuilding credit? I rent a duplex and pay on time every month.  I have rented since Aug. 98.  I would like to buy a house and get a loan for a newer used car. In three years my daughter will be in college. Any suggestions on re-building credit?  Also, a debt that was discharged is listed as a charge-off on my credit report with me , owing 919.00 dollars.  How can I clear this matter from my credit report?

Answer from Douglas W. Patterson:  The best way to rebuild your credit after a bankruptcy is to stay current on all of your post-petition obligations.  Car loans are the easiest types of credit to obtain after a bankruptcy.  I normally recommend that people stay away from credit cards, but you can rebuild your credit by taking out a credit card and paying off your monthly charges in full at the end of each month.  As to the credit report, you have the legal right to write the cerdit reporting agency with the correct information (include a copy of your discharge order) and demand that they correct the reporting error.

Question:  If I file BK due I have to include my house and car and what is the cost to do it right?

Answer from Douglas W. Patterson:  This question is the one I am asked most often.  A person who files bankruptcy is required to list all their debts and assets in their bankruptcy schedules.  Debts that they wish to keep (this is called reaffirming a debt) are listed as "intend to reaffirm".  As long as you are current on your payments on your home and car, ans you hacve less than $7,500 equity ($15,000 for husband and wife) in your house and less than $4000 equity in personal property ($8,000 for husband and wife) all of your assets will be exempt (cannot be taken from you) in a bankruptcy.   Most bankruptcies (chapter 7) cost $700, $200 for the court filing fees and $500 for attorney fees. 

Question:  I divorced in 8/97.  My ex was ordered to pay 3 debts - car, house,credit card. All 3 were jonit accounts. Divorce decree states I am to be held harmless from these 3 debts.She then rarely made payments. Then in 2001 she filed ch.13 bankruptcy which converted to ch.7 and granted 2002. Now the creditors for her 3 debts are coming after me. Can the creditors force me to pay the debts and thus should I file bankruptcy?

Answer from Douglas W. Patterson:  Unfortunately, the divorce decree did not terminate your creditors' ability to look to you for payment of debts that you were jointly indebted with your ex-wife.  If the debts were not paid in her bankruptcy, the banks can now proceed directly against you.  When she converted her chapter 13 to a chapter 7 proceeding, you had an opportunity to object to her ability to discharge (or get rid of) the debts the divorce decree required her to pay.  I assume that this was not done.  If it wasn't, it is certainly too late to do it now.  If you cannot afford to pay these debts, I would strongly encourage you to meet with a bankruptcy attorney to explore your options.

Question:  I have a vehicle in a chapter 13, 100 per cent plan. The vehicle was wrecked, and totaled. Can I get an order from the court to get a loan to buy a new vehicle?  The claim was a split, and the secured portion is payed, to release the title.

Answer from Douglas W. Patterson:  In most situations you can. A motion to approve the loan is not necessary. All you need to do is have your attorney provide details of the proposed loan and get approval from the Chapter 13 Trustee. Good luck.

Question:  In a chapter 13, how is the % of income determined as it pertains to monthly payment. Also, if the trustee decides to garnish wages, what is the maximum amount or % he can take. Also, who appoints the trustee and is there anyone, other than an attorney, to go to with bk concerns.

Answer from Douglas W. Patterson:  The monthly payment is determined by comparing the household income to the reasonable average household monthy income.  Obviously, a household with one person in good health will have fewer monthly expenses that a household with two adults and three kids.  The amount that your trustee would garnish would be the amount of your monthly payment that is approved by the court.  the trustee is appointed by the court.  Yes, an attorney is the best person to answer your bankruptcy questions.

Question:  What is the maximum annual income you can make and still file chapter 7 bankruptcy?

Answer from Douglas W. Patterson:  There is no official cap on the maximum amount of income a person can have and file chapter 7.  Household incomes and expenses are reviewed on a case by case basis to determine if chapter 7 is appropriate.  As a general rule, a household having greater monthly net income of more than $3000 would most likely not qualify for chapter 7, although this is not true for all situations, depending on the reasonable household expenses and the types and amount of debt.  I have seen instances where a single person with $2,400 per month net income needed to file chapter 13 because he did not have a rent or mortgage payment.  I have also had a doctor with an annual income of $120,000 qualify for chapter 7 because of the high costs of operating his office and because he owed the IRS over $150,000. 

Question:  I was forced into chptr 7 bankruptcy 6 years ago due to a divorce. I am now severely disabled awaiting a verdict on SSD. Since my illness 2.5 yrs ago medical and other debts have accrued. Can I file again now, or am I bound by the 7-10 yr period?

Answer from Douglas W. Patterson:  A person is eligible to file another chapter 7 six years and one day from their prior chapter 7 discharge date.  Please note that the discharge date is not the filing date. 

Question:  Are companies compensated in any way for their loses when filed against.

Answer from Douglas W. Patterson:  The only way any creditor receives money from a person, or corporation who files bankruptcy is if the bankruptcy generates money to be distributed to creditors.  Secured creditors, such as a mortgage holder or a bank that has made a car loan to a debtor, either get paid or get to sell the collateral (i.e. the house or car) and apply the sale proceeds to the debt.  Unsecured creditors only get paid if the debtor makes payments to unsecured creditors through a reorganization (chapter 11 or 13) or if the court liquidates (sells) non-exempt assets for the benefit of creditors.  Otherwise, creditors do not get paid.  A bankruptcy debt that is discharged is treated just like any other unpaid debt.  It is written off as uncollectible. 

Question:  What if after 2 years into a chapter 13 you decide to just turn it into a chapter 7 would you still have the option to reaffirm on your vehicles?

Answer from Douglas W. Patterson:  It would depend on the circumstances.  Has your income and/or living expenses changed so as to make chapter 13 innparopriate?  If not, then a conversion is not practical.  If a conversion to chapter 7 is now appropriate because of either income or expense issues, then the next thing to examine is whether or not the payments on the vehicles are now current in relation to what the payment history would have been had you not filed a chapter 13.  Most of the time a bank receives less in the first 12 months in a chapter 13 than it would have received if you had you continued to directly pay the full monthly payment to the bank.  Later on during the plan, however, (usually sometime between month 13 and 36) your bank will have actually received more under a chapter 13 then otherwise.  these situations need to be reviewed by the bankruptcy attorney on a case by case basis.

Question:  My wife and I have been drowning in bills since she lost her 45k job two years ago and I lost my 43k job last spring. Mainly credit card and doctor bills. We are still able to pay our necessities (utilities, mortgage, car payment) but not much else. She now makes 20k and I make 35k. What can we do???

Answer from Douglas W. Patterson:  From what you have told me, chapter 7 seems to be appropriate.  Chapter 7 would allow you and your wife to get a fresh financial start by reaffirming (keeping) certain debts such as your house and cars, while discharging (wiping out) your unsecured debt such as credit cards and medical bills.   To determine whether chapter 7 is appropriate for you and your wife, I would strongly encourage you to schedule a free initial consultation with a bankruptcy attorney.  Good luck to you and your wife.  For what it is worth, you are not alone.  There are hundreds of people in the Tri-State area who have been or are in the same position you are in right now.

Question:  After filing chapter 13, for the sole purpose to keep from losing my home, but only a few months later, I was being diagnoised as having cancer and no longer able to work.  Do I need to re-file under a different chapter to keep from losing my home?  I am mostly debt free, with the excpetion of my home loan. My home and the property it sits on is well worth what is owed on it, but due to having bad credit, I cannot re-finanace, at my present bank, or anywhere else. What can, or should I do? The bankruptcy court has been very cooperative thus far, and has scheduled a meeting in Feb. to review the case.

Answer from Douglas W. Patterson:  I do not know if I have enough information to properly respond to your question.  To do so, I would need to know the purpose of the original chapter 13 filing and know whether that purpose has been accomplished.  You have stated that you filed chapter 13 to "save your house".  Where you behind on your mortgage payments at the time you filed?  If so, have your chapter 13 payments now cured the mortgage arrearage?  If not, then conversion to another chapter would likely result in the loss of your home.  Did you file a chapter 13 because you have too much equity in your home which would have resulted in the sale of your hme in a chapter 7?  If so, then have your chapter 13 payments paid your unsecured creditors what they would have received if your home had been sold?  I doubt it.  You would be well advised to discuss these issues, in person, with your attorney prior to your hearing in February.  Good luck.

Question:  When filing Chapter 13 for reorganization of debts, how does the trustee determine what percentage in your income to base your monthly payment? If your income fluctuates up or, down for any reason how is your payment adjusted? If the trustee garnishes your wages, how much percentage can they garnish and what happens if you don't earn the amount they threaten to garnish?

Answer from Douglas W. Patterson:  First of all, your monthly payment must at least be enough to pay all secured debts (car loans, furniture loans, mortgage arrearages, etc.)  all administrative expenses (trustee fees and your attorney's fees), all priority claims (taxes and child support) along with a dividend to unsecured creditors of at least equal to what they would have received if you had filed a chapter 7.  After this test is examined, the court compares your average monthly income to the reasonable monthly living expenses for your family.  If your income varies greatly throughout the course of the year (which often occurs with construction or other seasonal workers) your plan would call for higher payments during the months you make more money and then lower payments for the months you typically make less.  The trustee will garnish the amount of your monthly payment that has been approved by the court.  If there is insufficient wages to be garnished, the court would most likely dismiss your case.

Question:  Can I take bankruptcy on part of my debts, such as medical bills and still keep my home and car?

Answer from Douglas W. Patterson:  In most situations the answer is yes.  If you answer yes to each of the following questions, then then the answer is yes.  1. Are you current on your mortgage and car payments?  2.  Do you have less than $7,500 in equity in your home ($15,000 for a home owned by a husband and wife), and less than $4,000 equity in your personal belongings (excluding your home and retirement funds), ($8,000 for a husband and wife)? 3.  Do you otherwise qualify for chapter 7?  

Question:  Is there a "credit cards only" bankruptcy chapter?  And, what is the Indiana state exemption for chapter 7 bankruptcy?  My income level is less than $13,000. and current credit card debt is about $10,000. . Ridiculous, i know, the debt was incurred during a relationship, since it ended the other party involved has refused to help resolve the debt. not a marriage. any help is deeply appreciated

Answer from Douglas W. Patterson:  There is no such thing as a "medical bankruptcy" or "credit card only" bankruptcy.  Generally these are chapter 7 bankruptcies, which is what appears to be appropriate for you.  In Indiana, retirement funds are totally exempt and a person can protect $7,500 in equity in realestate ($15,000 for husband and wife) and $4,000 in equity in personal belongings, liquidation value, not replacement value ($8,000 for husband and wife).  I would encourage you to schedule a free initial consultation with a bankruptcy attorney to fully review your situation.  Good luck.

Question:  How often can one file for bankruptcy ?

Answer from Douglas W. Patterson:  A person is eligible to file a chapter 7 six years from the date of a prior discharge.  As a chapter 7 lasts approximately 100 days, a person could theoretically file a chapter 7 once every six years and one hundred days.  There is no statutory limit as to how often a person can file chapter 13.

Question:  As a 27 year old, I am curious a s to how filing bancruptcy would affect any future attempt I would make at establishing good credit. For how long would I be considered a risk...say if I were to get married and want to buy a house...would having a bancruptcy in my past affect my ability to purchase a home, with my spouse?

Answer from Douglas W. Patterson:  A bankruptcy filing stays on your credit report for a period of ten years following your bankruptcy discharge.  Generally a bankruptcy filing would negatively effect your credit rating for a period of two years following your discharge, assuming you have kept your credit perfectly clean  following your bankruptcy filing.  After two years of keeping your credit clean, the bankruptcy would not prevent you from qualifying for a conventional mortgage, assuming you met all other qualifying criteria.  Good luck.

Question:  If I file bankruptcy now on unsecured debts, can the creditors take anything from me that is payed off or that was purchased with their credit card? Also can they take my tax refund if I file now?

Answer from Douglas W. Patterson:  General credit cards such as Visa, Mastercard or Discover do not maintain a security interest in the items you purchase.  Store cards such as Best Buy, Sears and King's do.   As such, if you purchase hard line items such as a TV, stereo or furniture on a store card, and you still have a balance on the store card, you should be prepared to either return the merchandise to the store or pay the store credit card.   Not all store credit cards retain a security interest in the purchased merchandise.  I would advise you to consult with a bankruptcy attorney to determine if bankruptcy is appropriate for you.  As to your tax refund, if you file bankruptcy before you receive your refund, the court will take it, if the refund is in excess of $1,000.  Good luck.

Question:  If a vehicle is paid for can you sell it to someone right before you file bankruptcy to have money to live on or can the state take it?

Answer from Douglas W. Patterson:  Normally, that is not a wise thing to do.  The reason for this is that an individual filing bankruptcy is allowed to exempt, or protect and keep, up to $4,000 in equity in personal bankruptcy, but only $100 in cash.  By converting an exempt vehicle into nonexempt cash, you would be shooting yourself in the foot. 

Question:  What is the charge for Chapter 7?

Answer from Douglas W. Patterson:  The filing fee for a chpater 7 is $200.  The typical attorney's fee for a chapter 7 is $500, or a total of $700 (filing fee plus attorney's fees).  Most attorneys do not require the total amount to be paid up front, but will instead set their clients up on a payment plan.

Question:  Can I switch from Chapter 13 to Chapter 7, and what would I have to do?

Answer from Douglas W. Patterson:  This is sometimes possible, depending on what the purpose of filing the chapter 13 is, whether those purposes have been accomplished, or whether your circumstances have changed since the filing of the Chapter 13.  I would strongly encourage you to schedule an appointment with your bankruptcy attorney to see if conversion to chapter 7 ia an appropriate action.  Good luck.

Question:  Can you file chapter 7 bankruptcy more than once and if so, after how many years? Also, Can you file against someone that is suing you for a judgement? Example: IRS or a civil matter

Answer from Douglas W. Patterson:  A person can file chapter 7 more than once.  A person is eligible to file a chapter 7 six years from the date of their prior chapter 7 discharge.  The filing of a lawsuit, even if the matter goes to judgement, does not prevent a debt from being discharged in a bankruptcy.  some debts, however, are not dischargable regardless of whether a lawsuit has been filed.  Non-dischargable debts include, but are not limited to most student loans, child support, most taxes and debts incurred through fraud.   

Question:  My sister filed chapter 13 & the trustee is paying her house payments late, shes tryng to refinance & may have a lot of late fees. Is this legal? Is she responsible for their mishandle, ings!

Answer from Douglas W. Patterson:  So long as your sister has remained current in making her monthly payments to the chapter 13 trustee, her mortgage holder is not permitted to charge late fees.  She should bring this matter to the attention of her bankruptcy attorney and he/she should be able to address the situation for her.  Good luck.

Question:  Is there no way to discharge student loans? How can a student put loans in an order such that is managable for him?

Answer from Douglas W. Patterson:  Student loans are generally non-dischargable in bankruptcy.  Are other debts preventing you from being able to pay your monthly student loan obligations?  If so, you could probably discharge your other debts in a chapter 7 and then focus on paying your student loans.  Chapter 13, however, might be most appropriate for you.  A chapter 13 would allow you to pay back your student loans over a five year period without interest, late fees or collection fees.  Chapter 13 oftentimes allows a person to lower their car payments (but not a house payment) thereby leaving more disposable income to pay the student loans.  If you are having problems paying your student loans or other debts, I would encourage you to schedule a free appointment with a bankruptcy attorney to fully explore your options.

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