Tag Archives: Keep your car in bankrtuptcy

7 bankruptcy repercussions are myths not to worry about

While some people take advantage of bankruptcy laws to improve their lives and finances, others have a long list of excuses why they refuse to file for bankruptcy protection. While some of the concerns people have are reasonable, they are often blown way out of proportion by the people who do not want you to get a bankruptcy. Who are these naysayers? Largely the people who work in the business of debt consolidation will try to scare you with misconceptions about bankruptcy.

Here is a list of bankruptcy repercussions you were told about but will probably never experience:

  1. The bankruptcy trustee will take everything you own. Not true: There are state exemptions allowing you to keep your personal belongings, vehicle and equity in your home up to a certain dollar amount.
  1. Everyone in town will know about your bankruptcy. Not unless you tell them: Where in the past years bankruptcies were more difficult or less common they may have appeared in the newspaper. Nowadays and especially in a big city like Chicago, nobody will ever know unless you tell them.
  1. Your wife will leave you and take the kids. While it’s possible, it’s unlikely: The negative stigma that used to follow a bankruptcy many years ago is no longer an issue for so many people who likely know people who got a bankruptcy and are doing well and are financially successful after their bankruptcy.
  1. You won’t be able to keep your home or car. You have options: You may keep your car if its value falls within exemption limits or you can sign a reaffirmation agreement to keep the car and make payments on it despite the bankruptcy. Keeping your home may be equally feasible through a Chapter 7 discharge or Chapter 13 reorganization bankruptcy case.
  1. The boss will surely fire you when they find out. Your boss has no reason to know: Unless you tell your boss that you need a day off work to attend your initial bankruptcy hearing, they have no reason to know about it. In fact, many people file for bankruptcy to prevent their boss from knowing about a wage garnishment, something they can avoid if they file bankruptcy.
  1. You won’t be able to rent an apartment. Not true: Even people with the most concerning financial track records are able to rent an apartment, and the only difference may be an extra month’s worth of a security deposit required by the landlord.
  1. You will never be able to get credit again. Biggest misconception: The moment your former debts are wiped away in bankruptcy, you have more spending power and a better ability to pay your bills. Not long after a bankruptcy you can get a secured credit card and start rebuilding your credit, focusing on your current and future credit while forgetting about the past.

If you want to learn the real expectations you should have when considering a bankruptcy filing, contact Joseph Wrobel, Limited to learn bankruptcy is like in the present day.

About us: Joseph Wrobel, Ltd., works with clients to find out if they qualify for Chapter 7 or 13 bankruptcy, and their options and rights under the law. The firm will also advise and assist clients with questions and concerns about the collectors and their rights to pursue you.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

 

Bankruptcy Basics: August 2015, Real Questions, Real Answers with Joseph Wrobel

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress.

Click/tap here to listen to the podcast now!

Topics covered in this 30 minute show:

  • How do I file for bankruptcy but also keep my home where I have a bad mortgage deal?
  • I had a bankruptcy 3 years ago and to date the bank has not taken my home, what do I do?
  • How can bankruptcy help me with medical bills I incurred when I didn’t have health insurance?
  • My husband might file for bankruptcy after the divorce, how do I protect my house?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973 he earned a JD from DePaul University Law School.

Visit our Chicago Bankruptcy website online for more about the firm. You may also contact Joseph Wrobel for more information at (312) 781-0996 and by e-mail at JosephWrobel@ChicagoBankruptcy.com

Everyone might want to know what most people experience when filing for bankruptcy protection

Filing bankruptcy will provide debt relief, eliminate bill problems and stop creditor harassment.
Filing bankruptcy will provide debt relief, eliminate bill problems and stop creditor harassment.

All clients at Joseph Wrobel, Ltd. will meet with an experienced bankruptcy attorney who will help them evaluate their entire current and near future financial picture to determine which chapter of bankruptcy protection (Chapter 7 or 13 most often) would help solve the client’s financial crisis. If it does not make sense to file a bankruptcy petition, clients will be offered other financial and credit repair options. Clients who are ready to proceed are given a list of instructions on what to do next so the attorneys can move forward with the bankruptcy with very little further action required of the client.

Everyone deserves a fresh start and most people who have already received a bankruptcy discharge would tell you the experience was more comfortable than expected.

Most people are not going to find out you filed for bankruptcy protection unless you tell them. While some local papers in smaller towns might print the names of local residents who have a bankruptcy filing, most of the clients in the Chicagoland area will proceed through bankruptcy without friends and neighbors knowing.

Most of your debts will be eliminated if you file a petition for a Chapter 7 discharge. Certain debts, as a Joseph Wrobel, Ltd., attorney will tell you, cannot be discharged. Examples of non-dischargeable debts include student loans, child support and maintenance.

Want to stop the annoying phone calls by credit card companies and bill collectors?

Most of the annoying collection phone calls will stop. While bankruptcy cannot eliminate all unwanted phone calls, the collection agencies who love calling during lunch and dinner will have to stop bothering you because of the “automatic stay” provision. While the bankruptcy case is active, there is a federal order of the bankruptcy court that “stays” (prohibits) collection activity including those annoying phone calls.

Most of your personal belongings, your car, 401(k) account, and the equity your home can still be yours after a bankruptcy discharge. If you live in the State of Illinois, there are homestead exemptions allowing you to keep equity in your home, a vehicle and other personal property up to a certain amounts. When you have certain assets worth more money than exemption limits, and when you have assets you consider irreplaceable, a Chapter 13 bankruptcy will give you options not included in the Chapter 7 full discharge most people think about when considering bankruptcy.

Anyone can make a full financial recovery from a bankruptcy in less time than many people think.

Most people can get credit cards (pre-paid credit and debit cards are easy to obtain) and buy homes and cars on credit within a few years of a bankruptcy discharge. Do not think that a bankruptcy means you are giving up and throwing in the towel. By eliminating debt you were never going to be able to pay, you get fresh start to rebuild your assets and credit rating, a fresh start.

The attorneys at Joseph Wrobel, Ltd. are available to talk to you and answer most of your questions over the phone and will treat everyone with the respect and dignity they deserve, despite their temporary financial circumstances. If you want to learn more about bankruptcy and credit management, contact an attorney at Joseph Wrobel, Ltd. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start. To keep in touch and read about consumer finance news and stories you can Like the firm’s Facebook page and Follow Joseph Wrobel. Ltd. on Twitter. If you need legal assistance, please call Joseph Wrobel, Ltd. by dialing (312) 781-0996 to talk to an attorney.

Ain’t No Reason To Reaffirm Your Mortgage, But There Certainly Is For Your Automobile

Let’s begin by defining reaffirmation:  A reaffirmation is an agreement made between a debtor and the creditor to re-pay a debt, whether it is the entire debt or part of the debt, that would be discharged in a Chapter 7 Bankruptcy.

Why would you agree to pay a creditor whose debt can be discharged? The answer requires understanding the difference between an unsecured and a secured debt.  An unsecured debt is simply a  promise to pay, whether orally or in writing. There is no collateral to secure the debt and the discharge that you receive when your Chapter 7 is completed, discharges the promise that you made to the creditor.

A secured debt has the same promise to repay as an unsecured debt but a secured debt also has collateral that secures the promise.  That collateral can be taken back by the creditor if you do not pay the debt. An example is a loan to finance the purchase of an automobile. The lender has a lien against the title to the vehicle. The lien rights allow the lender to repossess the vehicle if payment is not made.

What happens to a secured debt when you file a Chapter 7 Bankruptcy?  Let’s use that automobile loan as an example.  The completion of the Chapter 7 Bankruptcy discharges your personal obligation to pay on the promise, but the lien rights SURVIVE the bankruptcy. This means that you have to make a decision to either return your automobile or keep it and pay for it. If you return or surrender your vehicle, the Chapter 7 Bankruptcy discharge protects you from ever owing any money to the lender.

There are two ways to pay for your automobile. The first is to pay for it by redeeming the vehicle, making a one-time lump-sum payment equal to the value of the vehicle, which is a very uncommon situation. The second is to sign a reaffirmation agreement, agreeing to make the regular monthly payments until the vehicle is paid, after which you will receive the title. To keep your vehicle, even though you filed a bankruptcy, you will need to pay for it since the lien rights survive the bankruptcy.

What about your mortgage? Many clients ask me about reaffirming their mortgage. They think that it is required and is something that they should do. My response is that there is almost never a good enough reason to reaffirm a mortgage. Why? The mortgage lender will not foreclose as long as you make the mortgage payments. It may be a hassle to deal with the lender without the reaffirmation; your credit report may not reflect that you are making mortgage payments so that the payments do not help increase your credit score.; but the advantage of never having to worry about being personally responsible for the debt far outweighs any possible negatives. In our current times, when so many homeowners are “upside-down” on their home, and so many homeowners are considering whether it makes sense for them to keep their home ( Will there ever be equity in my house? How long will it take?), knowing that any time after your bankruptcy is completed you decide not to continue mortgage payments, clients have told me that it is a wonderful feeling knowing they never have to worry about “getting stuck” for the mortgage payments.

If you want to learn more about bankruptcy proceedings, contact an attorney at Joseph Wrobel, Ltd. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start. To keep in touch and read about consumer finance news and stories you can Like the firm’s Facebook page and Follow Joseph Wrobel. Ltd. on Twitter. If you need legal assistance please call Joseph Wrobel, Ltd. by dialing (312) 781-0996 to talk to an attorney.