Brownsville Bankruptcy Attorney
As you consider retaining a Brownsville bankruptcy attorney, you likely have many questions racing through your mind like, “Should I file for bankruptcy?” and “What alternatives to bankruptcy are available to me?” We understand that and have listed some of the more common Texas bankruptcy questions we regularly encounter. If your question is not answered here, don’t hesitate to give us a call and get your bankruptcy questions answered.
What is bankruptcy?
Bankruptcy is a legal proceeding regulated by federal law. If you cannot pay your bills, you can file for bankruptcy and stop creditors from trying to collect your debts while the legal system determines how to pay off your creditors.
Where do I file for bankruptcy?
Because bankruptcy protection is provided under federal law, you must file for bankruptcy at a federal court. Fortunately, the Texas Southern District Court has federal bankruptcy courts in Brownsville and McAllen. Your bankruptcy attorney will help you file the appropriate forms with the court.
How does bankruptcy protect me?
It can stop the foreclosure process, stop car repossessions, force the return or repossessed property after the fact, stop wage garnishments, prevent termination of utility service, restore utility service, stop debt collection calls, and eliminate the legal obligation you have to pay your debts.
Keep in mind what bankruptcy does not do as well. It does not eliminate a mortgage or a lien on your house. It does not discharge secured debt. For example, your home mortgage is a secured debt with the house being the collateral. The same is true of an auto loan. If you do not make the payments, you cannot keep the collateral. Bankruptcy does not apply to certain types of debts such as alimony, child support, and some student loans, criminal fines, court orders, and taxes. It also does not apply to any cosigners on your loans; your cosigners will still be responsible for paying back the loan.
What are the different types of bankruptcy?
The law provides four different types of bankruptcy protection: Chapter 7, Chapter 11, Chapter 12, and Chapter 13. The two most common types for individuals are Chapter 7 and Chapter 13.
Chapter 7, or liquidation as it is often called, requires that you give up property exceeding specified limits (except property that qualifies for an exemption under either federal or Texas law). The surrendered property is then sold and creditors are paid off from the proceeds of the liquidation. Chapter 13 bankruptcy, or debt adjustment as it is often called, requires that you create a repayment plan, have it approved by a bankruptcy judge, and pay your debts from current income according to the plan. In Texas, you may file for bankruptcy individually or jointly if married.
How many times can I file for bankruptcy?
Chapter 13 bankruptcies can be filed at any time after an initial bankruptcy while you must wait six years from the date of your filing if you want to file Chapter 7 again. However, your Brownsville bankruptcy attorney doesn’t want to see you continually making the same financial mistakes and will recommend post-bankruptcy steps that you can take to avoid this situation again in the future.
Are there any alternatives to bankruptcy?
Yes, you have options ranging from contacting your creditors directly and arranging an alternative payment plan or reduced payments to obtaining a debt consolidation loan and enrolling in a Texas consumer credit counseling plan. However, before you take out a loan or sign up for a credit counseling plan, contact your Brownsville bankruptcy attorney for a free consultation so that you have a better understanding of the most appropriate course of action for your current financial situation.
What are exemptions?
Exemptions are categories of property, up to specified limits, that are exempt from creditors after filing for bankruptcy. In other words, you can keep exempt property after bankruptcy. For example, certain types of personal property such as burial plots or family heirlooms are exempt as are some insurance benefits, pensions, public benefits, tools of the trade, and other items. A good bankruptcy attorney will help you list as many exemptions that you qualify for under Texas and federal law.
Does bankruptcy affect my credit?
Chances are, you already have terrible credit if you are on the brink of bankruptcy. Your credit history will show that you’ve filed for bankruptcy for ten years. However, once your debts have been discharged, some creditors may view you as a positive risk because you are now able to pay your bills.
My spouse is filing for bankruptcy, will this affect me?
It can definitely affect you. Not only are you still liable for joint debts, the decision to file individually or jointly is complex with numerous considerations. Contact a bankruptcy attorney to ensure that you are making the right choice for your situation.
Are student loans erased with bankruptcy?
Not unless your student loans are the exception rather than the rule. In general, bankruptcy does not discharge student loans. Two exceptions:
• If the student loan imposes an “undue hardship” on you or your dependents, it may be discharged.
• If the student loan is not insured or guaranteed by a governmental unit or if the student loan was made under a program funded in whole or in part by a non-profit institution or a governmental unit, it may be discharged.