What can I own after Bankruptcy, what happens to my debt, and will I have to go to court?

January 23, 2012 by The ME Law Firm

One of the most popular questions we hear is can I own anything after bankruptcy, what happens to my debts after bankruptcy, and will I have to attend court?  These are valid questions and the answers must be carefully understood before a bankruptcy is decided as a viable option.

The answer to the first question is yes, you can own “things” after bankruptcy.  In fact, after a bankruptcy it is easier to attain credit due to the fact that a bankruptcy cannot occur for quite some time.  In addition, property that is exempt from the bankruptcy court is owned by you and anything you obtain after the bankruptcy is filed.  There are some qualifications for the first 180 days after filing for bankruptcy for an inheritance, a property settlement, or life insurance benefits.  In these few examples, the creditors may have a right to the money and/or the property.  It is important to speak to a professional bankruptcy attorney about these matters if they relate to your situation.

The answer to the second question is a little more complicated.  Normally, a bankruptcy will “wipe out” all the debts with a few exceptions.  Bankruptcy does not wipe out money owed for alimony or child support, most fines/penalties to a government agency, student loans, debts not included on the bankruptcy petition, debts resulting from false information to the creditor, willful and malicious harm, or incurred by driving while intoxicated.

Another common question is whether you will have to go to court and attend a hearing.  Normally, you will only have to attend a 341 hearing, or commonly called a “meeting of creditors”.  This hearing is not in front of a judge, but rather normally in front of a trustee.  This is usually a short and simple procedure where you will be asked a few questions about your debts and your financial situation. If a debt is disputed or if there are a complications, then you will be required to appear before a Judge.

If you have any questions about the bankruptcy process, please contact us at Myers & Eichelberger at 1-888-ME-HELP-YOU.

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