Five Common Questions Regarding Chapter 7 BankruptcyComments Off on Five Common Questions Regarding Chapter 7 Bankruptcy
The lawyers at Teague & Associates, LLC have helped many clients through bankruptcy—and we get a lot of questions regarding the subject. In response, we decided to gather some of the most common and provide solid answers from a Chapter 7 bankruptcy attorney in St. Louis.
Chapter 7 bankruptcy, often called “straight bankruptcy,” is a liquidation process in which the court oversees the sale of assets to pay creditors and discharges debt, giving the person who files for bankruptcy a fresh start. (This is different from other forms of bankruptcy, such as Chapter 13). Here are some of the most commonly asked questions:
Will Anyone Know I Filed for Bankruptcy?
Technically, yes. Bankruptcy is a matter of public record and your filings will be available in court, should anyone care to look. It will also be reflected on your credit report. However, practically speaking, your bankruptcy filing will not be common knowledge. There is no Scarlet B, and your friends and colleagues generally won’t know unless you tell them. In most cases, the pool of people who know will be limited to those you have a financial relationship with, such as a creditor or mortgage lender.
Will I lose Everything I Own?
Generally speaking, no. Major assets will likely be sold as part of the bankruptcy process, in order to pay creditors. But there are many other items that can be exemptions, which vary state-by-state. In Missouri, for example, there are exemptions for clothing, home furnishings and appliances, jewelry (such as a wedding ring) and other possessions, though all are subject to financial limitations. For example, a wedding ring worth $1,500 or less can be exempt.
What About My Car and Tools—the Things I Need to Work?
In Missouri, there are exemptions for both a car and tools. Current law says a car or trade tools worth $3,000 or less may be exempt.
Will Creditors Keep Contacting Me?
Creditors are supposed to cease all actions, including calls and other communications, once bankruptcy documents have been filed in court.
Will My Family Be Effected?
This depends on your financial relationship with your family members. If you own assets such as a house jointly with a spouse or family member, they may be impacted. If there is no financial link, there may be no legal impact.
If you have more questions about bankruptcy, call a Chapter 7 bankruptcy attorney in St. Louis at Teague & Associates, LLC. Our legal staff can be reached at (314) 899-4499 for a complimentary consultation.