Bankruptcy FAQ

In some situations, filing for bankruptcy under the U.S. Bankruptcy Code is the best option to protect your financial interests, erase your debt, and give you the chance to start over. If you feel like you are drowning in debt, it is worth speaking with an experienced bankruptcy attorney to find out what your options are.

Under the federal Fair Debt Collection Practices Act (FDCPA), restrictions are placed on creditors and collection agencies regarding the methods they are allowed to use to intimidate you into paying. Furthermore, false or inaccurate reporting to Equifax, Experian, TransUnion, or other credit reporting agencies can cause you financial harm, and if this has happened to you, you may have grounds to sue. If creditors are harassing you, it's important to know that you are not alone. Blossom Law PLLC can help.

While wage garnishment is a legal action, and many creditors utilize this method to secure money owed them, filing for Chapter 7 bankruptcy can stop that process. If creditors or collection agencies are garnishing your wages, it is a good idea to speak with an attorney familiar with bankruptcy filing in North Carolina to discuss if this is a good option for you.

No. You can literally file bankruptcy if you have $1 of debt, though no one would ever do that, of course. In a Chapter 7 or Chapter 11 bankruptcy, there are no upper debt limits.

Not unless you want to. That is, you can choose to surrender your house and/or your car. But the reality is that most people want to keep their house and their car. There are exemptions in place that allow most people to keep their homes and cars.

You will be able to keep most, if not all, of your assets, because the law allows you to exempt your assets up to a certain dollar amount. That dollar amount is usually pretty generous. Retirement accounts, as long as they are qualified retirement accounts under the IRS code, are fully exempt.

It depends on the type of tax, when you filed the tax return, when the tax debt was due, and when the IRS (or state) assessed the tax. As tax debt can be complicated, it's best to meet with an attorney to see whether or not the debt is dischargeable.

Yes. Medical bills are quite often the primary reason people file bankruptcy.

It depends. Most debts are eliminated, but some are not. Some that are not are certain tax debts, spousal and child support obligations, student loans, and mortgages and car loans if you decide to keep your house or car.

In the event you mistakenly omit a creditor, you can add them after the bankruptcy case is filed. However, it will cost additional attorney's fees and court fees. Obviously, the goal is to be as careful as possible to include all your creditors with the initial paperwork.

No. You must list all your creditors. Failure to list all your creditors can result in a denial of your general discharge, which is the very reason you filed bankruptcy in the first place, or a denial of the discharge of the debt owed to that particular creditor.

Yes. In Chapter 7 cases, you can literally obtain credit the next day after filing. You can take steps to buy a car to get to and from work or if you have other needs, and other options for obtaining loans or credit may be available.

You can file Chapter 7 every eight years.

No. However, if you have joint debts with your spouse, it may make financial sense for your spouse to file bankruptcy with you.

Since you're an authorized user, you're not financially responsible for the debt. So, your bankruptcy filing should not affect the other person's relationship with the creditor. However, just to be safe, my usual recommendation is to have the account holder call and have someone who is about to file bankruptcy removed from the account as an authorized user.

No. Though a bankruptcy filing is public, the reality is that no one will know that you filed for bankruptcy unless they go to the courthouse and ask, they are one of your creditors, they get a copy of your credit report, or you tell them.

In terms of employment, it's against the law for an employer to discriminate against you solely because you filed bankruptcy. So, an employer can't terminate you solely for that reason.

It depends. Unless covered by an exemption, for a Chapter 7 case, if you become entitled to inherit property within 180 days of filing bankruptcy, your inheritance could be distributed to your creditors.

If you have enough room under the exemption cap, you can keep your tax refunds. Any amounts in excess of the exemption cap can be seized.

Yes. However, you often will have to come up with a deposit for a new account.

Student loan debt generally survives a bankruptcy discharge unless the court grants you a hardship discharge. This very rarely happens and is quite expensive to pursue, because it requires the filing of a lawsuit against your student loan creditor.

I come from a blue-collar, middle-class background, and I am no stranger to financial struggles. I know how hard it is to work tirelessly and still feel like financial security is out of reach. I believe everyone deserves the chance to prosper, and I am committed to helping my clients across North Carolina get the dedicated, compassionate legal representation they deserve. If you are struggling with debt, there is hope. To learn more about my debt relief services and bankruptcy services, call Blossom Law PLLC at 704-256-7766 or contact us online.