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Chapter 7
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Chapter 13
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The goal:
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Eliminate as much debt as possible without losing any property or possessions.
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Reorganize individual or family debt in a way that makes it manageable to pay off.
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Who should do this?
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Those who have incurred a significant amount of unsecured debt such as credit
cards, loans, medical bills, a deficiency on a repossessed automobile, and old
tax debts.
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Those who have fallen behind on mortgage or automobile payments or those who
have a significant amount of equity in their home. Also, anyone who has
significant priority debts such as recent tax debts.
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What is the first step?
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A free consultation is held at The Fox Valley Legal Group for both Chapter 7
and Chapter 13. At this meeting an attorney will ask you questions to help
decide what type of bankruptcy is best for you.
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What happens next?
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Your petition (case) is filed with the court. Approximately one month later you
attend a creditor meeting with your attorney.
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What questions are asked at this meeting?
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A trustee will ask you about your income and assets. This brief meeting is to
determine if you have any assets (property) worth administering (selling). In
the vast majority of cases, the trustee recommends your case for discharge and
you get to keep your property.
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A trustee will ask questions to determine whether the repayment plan that you
and your attorney filed is feasible. After the meeting the trustee will make a
recommendation for confirmation by the judge. Confirmation is the process
whereby the judge approves your case.
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How long does a bankruptcy last?
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There is a 60 day waiting period before the discharge goes into effect. It is
highly unlikely, but a creditor could object to a debt being discharged during
this time. If this occurs, the discharge is still granted on all other debts.
Then a settlement is reached or a trial is held regarding the objection.
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Chapter 13 bankruptcies last anywhere from 2-5 years. A debtor receives his or
her discharge when the plan that was proposed is paid in full. Your Chapter 13
payments begin 30 days after your case is filed. You may choose to have your
payments deducted directly from your paycheck.
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