Schaumburg Bankruptcy Lawyer
People find themselves deep in debt for a number of reasons. From job loss to medical expenses, out of control debt can build up quickly. Even if you tried to keep up on your payments, once you start missing a few, interest charges and late fees might make it impossible.
Having a mountain of debt can be stressful and traumatic. You might lose sleep at night, and it could create conflict within your family. Receiving collection phone calls at home and work can be an embarrassment and cause tension – even putting your job at risk. When collectors garnish your wages, other bills may go unpaid and create a mountain of debt that makes you feel like you are drowning. That is why at the law office of Robert M. Kaplan, PC, we provide solutions to assist you in getting back on your feet and minimize the stress that comes from financial debt.
- What is bankruptcy?
- What are the different types of bankruptcy?
- What are the limitations of bankruptcy?
- How long after filing for bankruptcy will the creditors stop calling?
- Will I have to go to court when I file for bankruptcy?
- Will bankruptcy wipe out all of my debts?
- What if I have additional questions about bankruptcy?
What is bankruptcy?
Bankruptcy is a legal process by which an individual who cannot pay his or her bills can get a fresh financial start. The right to file for bankruptcy is provided by federal law, and all bankruptcy cases are handled in federal court. Filing bankruptcy immediately stops all of your creditors from seeking to collect debts from you (the “automatic stay”), at least until your debts are sorted out according to the law or they get relief from the automatic stay to protect their interest in any secured property.
For many people, bankruptcy is a new beginning. Last year, over one million people filed for bankruptcy and gained control of their finances. You might have heard varying stories about how bankruptcy works and that is because several different bankruptcy options exist, depending on your current situation.
Bankruptcy allows you to gain control of your finances and, in some cases, eliminates your debt completely. For over ten years, we have been helping people just like you get a fresh start by working together as a team to find a solution that will take the fear out of answering your phone and opening your mailbox.
What are the different types of bankruptcy?
Robert Kaplan will review your case, your financial obligations, and your assets to determine the type of bankruptcy that will work best for you. While there are officially four types of bankruptcy, the following three are most commonly seen:
Chapter 7 Bankruptcy – This type of bankruptcy allows our clients to eliminate the majority of their debt, including credit card debt. It will also stop the harassing phone calls that come from collectors, foreclosures, repossessions, and wage garnishment.
Chapter 11 Bankruptcy – This type of bankruptcy is reserved for businesses that cannot pay their debts. This plan allows for a restructuring of business finances to enable repayment.
Chapter 13 Bankruptcy – Chapter 13 allows us to work with your creditors to restructure your debt so that you can repay a portion of what you owe over a three to five-year term. At the end of that term, the remainder of your debt will be discharged.
When the laws changed in 2005, it left many people feeling like they could not benefit from filing bankruptcy, but millions of people just like you continue to find financial relief through the bankruptcy process. Having a skilled attorney is essential to ensure the best outcome.
What are the limitations of bankruptcy?
The bankruptcy process can:
- Eliminate the legal obligation to pay most or all of your debts. This is called a “discharge” of debts. It is designed to give you a fresh financial start.
- Stop foreclosure on your house and allow you an opportunity to catch up on missed payments. However, it does not automatically eliminate mortgages and other liens on your property without payment.
- Prevent repossession of a car or other property, or force the creditor to return property even after it has been repossessed.
- Stop wage garnishment, debt collection harassment, and similar creditor actions to collect a debt.
- Restore or prevent termination of utility service.
- Allow you to challenge the claims of creditors who have committed fraud or who are otherwise trying to collect more than you really owe.
The bankruptcy process cannot:
- Eliminate the rights of “secured” creditors who have a mortgage or lien on property as collateral for the loan. Common examples are home mortgages and car loans. You can force secured creditors to take payments over time in the bankruptcy process, and bankruptcy can eliminate your obligation to pay any additional money if your property is taken. However, you generally cannot keep the collateral unless you continue to pay the debt.
- Discharge types of debts singled out by the bankruptcy law for special treatment, such as child support, alimony, certain other debts related to divorce, some student loans, court restitution orders, criminal fines, and some taxes.
- Discharge debts that arise after a bankruptcy has been filed.
- Protect cosigners on your debts. A bankruptcy discharge does not protect the relative or friend who has co-signed a loan.
How long after filing for bankruptcy will the creditors stop calling?
Once a creditor or bill collector becomes aware of a filing for bankruptcy protection, it must immediately stop all collection efforts. After you file the bankruptcy petition, the court mails a notice to all the creditors listed in your bankruptcy schedules. This usually takes a couple of weeks. Creditors will also stop calling if you inform them that you filed a bankruptcy petition and supply them with your case number. In some cases, you or your attorney should contact the creditor immediately upon filing the bankruptcy petition, especially if a lawsuit is pending. If a creditor continues to use collection tactics once informed of the bankruptcy they may be liable for court sanctions and attorney fees for this conduct.
Will I have to go to court when I file for bankruptcy?
In most bankruptcy cases, you only have to go to a proceeding called the “meeting of creditors” to meet with the bankruptcy trustee and any creditor who chooses to come. Most of the time, this meeting will be a short and simple procedure where you are asked a few questions about your bankruptcy forms and your financial situation.
Occasionally, if complications arise, or if you choose to dispute a debt, you may have to appear before a judge at a hearing. If you need to go to court, you will receive notice of the court date and time from the court or your attorney.
Will bankruptcy wipe out all of my debts?
Mostly, with some exceptions. Bankruptcy will not normally wipe out:
- Money owed for child support or alimony, fines, and some taxes
- Debts not listed on your bankruptcy petition
- Loans you got by knowingly giving false information to a creditor, who reasonably relied on it in making you the loan
- Debts resulting from “willful and malicious” harm
- Student loans owed to a school or government body, except if the court decides that payment would be an undue hardship
- Mortgages and other liens which are not paid in the bankruptcy case (but bankruptcy will wipe out your obligation to pay any additional money if the property is sold by the creditor).
What if I have additional questions about bankruptcy in Illinois?
We understand that filing for bankruptcy can be a difficult and confusing time. If you have additional questions about your potential or a previous bankruptcy filing in Illinois, our law office is here to help. We always have free consultations available. Call our Schaumburg, IL law office to schedule a consultation with Robert M. Kaplan and learn about the options available to you.