Bankruptcy FAQ

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1. Q: With Johnson Legal Group, PLLC, if I decide to file for Chapter 7 Bankruptcy what does my fee cover?
A: A bankruptcy lawyer with Symmes Law Group will prepare and file your bankruptcy petition with the court, answer your questions and attend your 341 trustee meeting with you. The trustee meeting is most likely the only time you have to go to court.

2. Q: What does it cost to file for a Chapter 7 Bankruptcy?
A: Johnson Legal Group always quotes flat fees in conjunction with a Chapter 7 Bankruptcy. The fees change periodically, and certain discounts or special incentives may apply. Johnson Legal Group does annual research to ensure our fees are righ in the average. We’re better than the bad attornies charging low fees, but still don’t price gouge like some other attorneys. Fair, affordable, and we always provide the most value in Seattle bankruptcy lawyers. The fee also comes with our Service Guarantee – the only service guarantee in Seattle.
There is a court filing fee of $335, credit counseling fee of $25-$50, and a credit report fee of $40-$80 which is an additional cost to the flat fee legal fee that we quote you. The legal and credit report fees are due prior to us filing your case, however the court filing fee may be paid in installments with the bankruptcy court post filing. You may retain us and make payments which will stop creditors from harassing you, however by law we cannot file your case until the full fee is paid.

3. Q: Which debts are dischargeable?
A: Any form of debt other than the few exceptions out there. The most common debts such as credit cards, medical bills, old car loans, mortgages on foreclosed homes, and payday loans are dischargeable. Student Loans, taxes within the last three years, alimony, child support, debts from illegal activity, and any credit account to which a debtor charged $600 or more in the last 90 days prior to filing are all not dischargeable in bankruptcy. However most creditors will simply write off this debt, but its something to consider when timing your bankruptcy.

4. Q: Who qualifies for a Chapter 7 Bankruptcy?
A: The United States Bankruptcy code allows any household below the median in income to qualify for Chapter 7 Bankruptcy. To determine whether or not you qualify for a chapter 7 bankruptcy we must look to see if your total income is below the state Washington state average income for your household size, and whether you have filed a Chapter 7 bankruptcy in the last 8 years. In some cases, you may be above the median but still qualify, but those are rare and an attorney needs to assess the situation thoroughly. If you originally filed a Chapter 13, then there are other avenues which we may be able to consider. There are other factors to consider which we can go over during your free consultation.

5. Q: How much of my property can I keep when I file Chapter 7 Bankruptcy?
A: Usually all of your property. In most cases you will be allowed to retain all of your personal goods including vehicles and a personal residence through bankruptcy exemptions. A bankruptcy attorney with Johnson Legal Group will assess your situation and determine whether the federal or state bankruptcy exemptions should be applied to your case. If you own more property than you have exemptions, there are a few tricks we can use to help stretch your exemptions a little farther.

6. Q: When and where do I have to go to court?
A: In most cases you will only be required to go to court one time to meet with a trustee who will ask questions on the record and under oath about your bankruptcy petition. The 341 meeting u occurs in about 5-6 weeks from your bankruptcy filing date and is scheduled after filing. The meeting will be held in the jurisdiction for which you live. In Seattle, the bankruptcy court is located at 700 Stewart St., Seattle, WA 98101. If you live in Snohomish county, the 341 hearings are held at the American Red Cross building in Everett on the corner of 26th and Lenora.

7. Q: Can I file my Chapter 7 Bankruptcy case in Washington State?
A: You may file your chapter 7 bankruptcy case in Washington State if you have lived in Washington state for the at least 180 days.

8. Q: How long until my debts are completely discharged after filing bankruptcy?
A: Generally the entire chapter 7 bankruptcy process takes about 120 days from the date of filing. You will be notified by mail by the court of your discharge. After you file your case you will have the protection of the automatic stay which prevents creditors from taking any collection on debts without express court approval.

9. Q: If my paychecks are being garnished, can a chapter 7 bankruptcy stop the garnishment?
A: Absolutely, a chapter 7 bankruptcy will stop your garnishment after a bankruptcy lawyer files your case and notifies your employer. Johnson Legal Group will sometimes

10. Q: Will a chapter 7 bankruptcy stop a foreclosure on my home?
A: No, but it will delay the process. Filing chapter 7 may only delay the foreclosure process and in most cases does not allow a debtor to catch up on arrears. A secured creditor may file a motion for relief from stay and continue the foreclosure action when the motion is approved (takes a minimum of 21 days) or after you have received your discharge.

11. Q: How often can a person file a Chapter 7 Bankruptcy?
A: A debtor may file for chapter 7 bankruptcy every 8 years. A chapter 13 may be filed after 4 years from the filing date of a chapter 7 bankruptcy.

12. Q: Is there a minimum debt that I should have to file a chapter 7 bankruptcy?
A: There is no set amount that a debtor must have in order to file bankruptcy, however Johnson Legal Group, PLLC we usually set the unofficial minimum at $10,000 in debt in order to avoid any bankruptcy abuse actions from the trustees office. If you can repay your debt in the near future then it is possible that debt settlement may be a better route for you.

13. Q: Can I keep my bank accounts or credit account that I like open?
A: In chapter 7 bankruptcy you cannot choose what debts you would like to include, and which debts you would not like to leave off of the bankruptcy. You must include all of your debt debt or you should not file, there is no in between. Whether a bank or credit card company wishes to keep you as a customer is up to them. You will need to call the provider to find out what will happen if you file bankruptcy.

14. Q: How long does a bankruptcy stay on my credit report?
A: A chapter 7 bankruptcy will stay on your credit report for a period of 10 years. After you file bankruptcy you may immediately start rebuilding your credit through obtaining higher interest rate credit cards and prepaid credit cards. Ideally you should qualify for a home loan within 2 years (if you reaffirm at least one debt) or 5 years.

15. Q: What is the bankruptcy means test?
A: The means test in a chapter 7 bankruptcy determines when a household, above the median income for the state, can still file for a chapter 7. If a debtor can justify that they have no excess income in which to put towards a chapter 13 payment plan, then the means test may help to qualify the debtor for a chapter 7 bankruptcy.

Chapter 13
1. Q: If I choose to hire a bankruptcy attorney at Johnson Legal Group, PLLC in a chapter 13 Bankruptcy what does my fee cover?
A: The lawyers at Johnson Legal Group will prepare and file your bankruptcy petition with the court, put together a repayment plan that will be confirmed by the court, answer your questions, attend your 341 trustee meeting with you, and attend a confirmation hearing on your behalf. The trustee meeting is most likely the only time you have to go to court.

2. Q: What does it cost to for a file chapter 13 bankruptcy?
A: A flat fee which is set by state law will be quoted to you during your free initial consultation depending on the facts of your case. There is a court filing fee of $310, credit counseling fee of $25-$50, and a credit report fee of $40-$80 which is an additional cost to the flat fee legal fee that we quote you. The legal and credit report fees are due to us prior to filing your case, however the court filing fee may be paid in installment over several months with the bankruptcy court. You may retain us and make payments which will stop creditors from harassing you, however we cannot file your case until the full fee is paid.

3. Q: Who qualifies for a chapter 13 bankruptcy?
A: Most debtors qualify for a chapter 13 bankruptcy as long as they can afford to make the necessary payments every month. If you have filed bankruptcy in the last 4 years you are not eligible for your discharge until the 4 years have passed. You may still file in the meantime if your payment plan would be 5 years. (see next question)

4. Q: How long to payment plans last?
A: A 3 year repayment plan is used for debtors who would qualify for a chapter 7 bankruptcy based on their household income. The majority of chapter 13 bankruptcy cases will be 5 year plans for debtors whose household income is above the median in their state.

5. Q: Which debts are dischargeable?
A: Technically every debt except one of the few exceptions. The most common debts such as credit cards, medical bills, and payday loans are dischargeable in a chapter 13 bankruptcy after you have made payments into your payment plan for the required period. Student Loans, taxes within the last three years, alimony, child support, debts from illegal activity are not dischargeable. If you have charged more than $600 to an account within 180 days of filing, then those debts must be paid in full through the plan. This could potentially increase the payments that you are required to make every month.

6. Q: How much of my personal belongings can I keep when I file Chapter 13 Bankruptcy?
A: In most cases you will be allowed to retain all of your property including vehicles and primary residence. A bankruptcy lawyer with Johnson Legal Group will assess your particular situation and determine if federal or state bankruptcy exemptions should be applied to your particular case. If your property is valued above the exemption laws, you may be required to pay additional money into your repayment plan to make up the difference.

7. Q: When and where do I have to go to court?
A: In most cases you will only be required to go to court one time to meet with a trustee who will question you about your bankruptcy petition. This meeting usually occurs in about 5-8 weeks from your filing date. The meeting will be held in the jurisdiction for which you live and you will have a Seattle bankruptcy lawyer attend with you. In Seattle, the bankruptcy court is located at 700 Stewart St., Seattle, WA 98101. Those in Snohomish County will attend their hearing at the American Red Cross building in Everett on the corner of 26th and Lenora.

8. Q: Who do I make my monthly chapter 13 installment payments too?
A: You will make your payments directly to the chapter 13 trustee for the Western District of Washington. The payments must start immediately after your case has been filed. You must usually pay the first few payments by mail using a money order or cash. The trustee does not accept personal checks. In most cases you will later sign up for automatic withdrawals from your paycheck or bank account and you won’t have to worry about the monthly payments. .

9. Q: If I recently moved to Washington, can I file my case in Washington State?
A: You may file your chapter 13 bankruptcy case in Washington State if you have lived in Washington for the greater part of the last 180 days.

10. Q: How long do I have to wait until my debts are discharged?
A: This will depend on your payment plan duration. The entire chapter 13 bankruptcy process takes about 3-5 years from the date of filing. You will be notified via mail when you receive your discharge.

11. Q: Can I change my chapter 13 case to a chapter 7 case?
A: Yes. You may convert from one form of bankruptcy to the other once as of right. You will still need court approval to do so. Most commonly, if your family has suffered a decrease in total household income that would allow you to qualify for Chapter 7 (ie you now are below median income for the family size), then your lawyer may convert the case with the court by filing a motion to convert your case to a chapter 7 bankruptcy. Newborn children can also be a factor.

12. Q: If my wages are being garnished, can a chapter 13 bankruptcy stop the garnishment?
A: Yes, a chapter 13 bankruptcy will stop your garnishment after we file your case and notify your employer.

13. Q: Will a chapter 13 bankruptcy stop a foreclosure on my home?
A: Filing a chapter 13 bankruptcy will stop a foreclosure on your home and in most cases allows a debtor to catch up on arrears. These arrears will be considered priority debts which have to be paid back in full over the course of you repayment plan. This will cause your monthly payments to increase, however if you can afford to make the payments and wish to keep your home, a chapter 13 bankruptcy is a good option for you.

14. Q: How often can a person file a chapter 13 bankruptcy?
A: A debtor may file for chapter 13 bankruptcy after 4 years have passed from the original bankruptcy filing date.

15. Q: Do I have to make a minimum monthly income to file a Chapter 13 bankruptcy?
A: Yes. A debtor must be able to make payments into their repayment plan every month. If you cannot afford your monthly payments, your case will be dismissed and you will not receive a discharge of any remaining debt.

16. Q: Can I keep my bank accounts or credit account that I like open?
A: In chapter 13 bankruptcy you cannot choose which debts you would like to include, and which debts you would not like to include. You must include all debt or no debt, there is no in between. Whether a bank or credit card company wishes to keep you as a customer is up to them. You will need to call them to find out what will happen if you file bankruptcy.

17. Q: How long does a bankruptcy stay on my credit report?
A: A chapter 13 bankruptcy will remain on your credit report for a 10 years period. After you file bankruptcy you may immediately start rebuilding your credit through obtaining higher interest rate credit cards and prepaid credit cards. Filing a chapter 13 bankruptcy will almost always have a more favorable result on your credit score than filing a chapter 7 bankruptcy due to the fact that you are making payments on some of your debts.

18. Q: I’ve read about lien stripping. Can I strip and discharge my second mortgage in a Chapter 13 Bankruptcy?
A: Sometimes. Whether you can discharge and strip your second mortgage will depend on your primary (first) mortgage debt and the value of the home. If your home is valued at less than your first mortgage you may completely strip off the second mortgage and get it discharged through a chapter 13 bankruptcy. If your home is worth more than your first mortgage, lien stripping will not be an option for you.

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