I hope this doesn't sound crazy... I just don't understand how this works. I was reading the newspaper and noticed there are different types of bankruptcy. Chapter 7 (i think) is reorganization (right?), I noticed that the dollar amount wasn't high under 5,000 for most. Well my question is, is this for use like on credit cards and/or smaller debts? Is possible to file for bankruptcy for only certain items like ONLY CC's? Even if you have a morgate and Car loan? Does it work like this? FYI.. I'm thinking of going the BK route.. this is something I don't to much about. Thanks
I am not an expert but I THINK as long as the mortgage and car payments are not in arrears you can keep them (not include them in BK)
There are two types of bankruptcy Chapter 7 which is liquidation, meaning all accounts listed in the petition are discharged. Chapter 13 which is reorganization, in which certain debts are discharged, while others are reorganized and paid to the creditors under new terms and amounts. After a certain period of time these debts are also discharged. It is my understanding that you can exclude any accounts from your bankruptcy petition, however if you are going to just list Credit Cards, you will do the same damage to your credit if you were going to list all debts. I would list all debts. Certain debts debts are allowed to be exempted from bankruptcy such as your home. In most cases you also can keep your auto assuming you make the payments. FU-TU
FU-TU Thanks for the reply earlier... So... what's the difference since they have changed the laws? Isn't it harder to file just your CC's and etc?
Martysgirl, Regardless of which chapter you file under, you must list ALL debts including auto loans and mortgages. Now, if the trustee and judge and creditor agree, you will be allowed to reaffirm a mortgage or auto loan. If you do reaffirm them, they will still carry a notation of included in bk. Also, as to mortgages. The amount of equity you can keep in bk is determined by the laws in your state. They range from unlimited equity in Fl. Tx, Ks, Iw, and SD to specific dollar limits in other states.
How much credit card debt are we talking about?? I would hate to see you trash your credit, you have been on the boards for awhile and seem to be working hard .
Martsgirl, There are no new bk laws. The measure that was passed a year ago are hung up in a joint House Senate Conference Committee to try and reconcile differences. The outcome is in doubt. www.clla.org has a running commentary on the progress.
OHHH HELL NOOOOO .... I'm not filing BK...!!!!! These are questions that I wasn't sure about! I figured if anyone would know the answers...it would be here at the board. I was just wondering why everyone was talking about the new laws of BK and how hard it is to file now and etc... Thats all...
Well good. Sorry it thought you posted you were thinking about going that route?? Well good I am glad you don't have to do that.
To be honest Bailey... after being on this board for sooo long... I would feel like a FOOL.. for even thinking of BK...lol...!!!! I guess my mind is going 50 miles a minute. I'm on bedrest and board..lol..!!
Keepmine Thanks for the clarification, you are correct that you must list all debts. I was trying to explain that you can reaffirm any debt as you stated. I believe the Bankruptcy Reform Act poses income limitations on who can file Chapter 7 ($51,000 annual) ??
The only income limitation I have seen is if your income is above the median income for your state then, you are thrown into a glorified Chater 13. These are just propsals now but it's part of a means testing scheme. If you are above the median, you might be forced to repay up to 25% with a cap of $30k over a 5 year period. But, there were so many loopholes in the way income could be tabulated that most were starting to back away from that part of the bill. And, if you're income is below the median in your state then, you are in the good old fadhion chapter 7 anyway. Again, these were just proposals and the whole thing is very much in doubt.
