Bankruptcy Faq


Please keep in mind that this is general information only. We pride ourselves on giving you the personalized attention your case deserves. For a detailed answer to your specific question, please contact us for an appointment.

What is Bankruptcy?

Bankruptcy is a legal process that allows individuals to either erase (“discharge”) most of their debts, or at least reorganize them and allow repayment over a set period of time. It’s not quite a financial clean slate (because some debts cannot be dismissed), but it does provide a solution for people with unmanageable debt.

What is the difference between Chapter 7 and Chapter 13 Bankruptcy?

Chapter 7 wipes out most debts, while Chapter 13 sets up repayment terms over time with all your creditors. Each type of bankruptcy outlines:

  • What debts can be forgiven
  • The length of the repayment plan
  • What assets you can keep

Figuring out which is one is right for you depends on the type of debts you have, your assets, the assets you want to keep, and your ability to repay. A bankruptcy attorney can help you with this difficult and complex task.

Will Chapter 7 wipe out all my debts?

Most of your debts will be dismissed. However, the following cannot be discharged:

  • Child support or alimony
  • Federal, state, and local taxes
  • Student loans
  • Debts not listed during the initial bankruptcy filing
  • Any type of legal judgment (e.g. from a lawsuit)
  • Debts for loans/items/property that were obtained fraudulently

What can I keep after Bankruptcy?

Under Chapter 7, you may end up losing property and assets even as most of your debts are dismissed. However, state law does allow for some exemptions, which typically include:

  • Vehicles (up to a specific amount)
  • Home equity (up to a specific amount)
  • Jewelry
  • Tools necessary to your job

Under Chapter 13, you can keep your property (such as a home or car) since you are setting up a plan to pay the loans back over time. Your creditors are not allowed to foreclose or repossess once you’ve filed.

Do I need to go to court?

You may need to attend a short “Creditor’s Meeting” where you answer fairly easy questions from the bankruptcy trustee and various creditors about your bankruptcy forms. There shouldn’t be any other court appearances.

How will Bankruptcy affect my credit?

Both types of bankruptcy will negatively affect your credit for as long as seven years. You may find it difficult to obtain credit cards or loans at a low interest rate. However, Chapter 7 will weigh on your credit more heavily than Chapter 13.

Contact Irina S. Puhachevsky, San Francisco Bay Area Bankruptcy Lawyer

We can help you get your finances back on track. Call us today at 415-300-0411 for an appointment.

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