Important Aspects of Bankruptcy
If you have been considering filing for bankruptcy, you may be feeling a lot of things including confusion. You should be aware of the basic information before you call us to begin the process. Here are the important aspects of bankruptcy.
Important Aspects of Bankruptcy | Automatic Stay
The automatic stay is one of the most important benefits of filing for bankruptcy. The automatic stay temporarily stops all collection activities against the debtor, including telephone calls, collection letters, lawsuits, garnishments, and repossessions. If creditors violate the automatic stay, they might be liable for damages to you, the debtor.
Important Aspects of Bankruptcy | Trustee
The court will appoint a trustee to administer the bankruptcy process. In a Chapter 7 bankruptcy, for the minority of cases where the debtor has assets that cannot be protected, the trustee will oversee the collection and sale of those assets and will pay creditors with the proceeds. In a Chapter 13 bankruptcy, the trustee reviews the proposed repayment plan, collects the money paid by the debtor, and makes payments to creditors. In certain situations, the trustee will start legal actions to protect the estate and recover money or other assets that ought to go to creditors.
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Important Aspects of Bankruptcy | Exemptions
While bankruptcy is largely governed by federal law, New York State laws have a great impact in determining what property a bankruptcy debtor can keep, known as exemptions. New York State’s exemption laws are favorable to bankruptcy debtors. While it must be determined on a case-by-case basis, the vast majority of bankruptcy debtors in New York State find that all or nearly all of their property, including a house and vehicle, is protected by exemptions.
Important Aspects of Bankruptcy | Reaffirmation Agreement
A secured creditor – such as a mortgage holder or owner of a car loan – may ask for a reaffirmation agreement. This states that your obligation for certain large debts remains even after bankruptcy. Your ability to keep a car or house might depend upon a reaffirmation agreement.
You can learn more about the different aspects of bankruptcy when you sit down for a consultation with our Buffalo bankruptcy attorney. Please call our office today.