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Helping Individuals Facing BankruptcyBeing overwhelmed with debt can be frightening and confusing. We’ve provided the answers to frequently asked questions on this site and also some basic information about bankruptcies is shown below. Learning about the types of bankruptcies and what they will do for you is the first step to end creditor harassment, prevent vehicle repossession, or stop a mortgage foreclosure. Chapter 7 (Fresh Start or Clean Slate Bankruptcy)
An Individual Chapter 7 bankruptcy is a petition to liquidate a debtor’s non-exempt property, pay off the creditors to the extent possible, and discharge (forgive) the debtor from his or her other debts. This form of bankruptcy is designed primarily to help individuals with overwhelming debt and insufficient income to pay back the debt. A Chapter 7 discharge provides relief for most common types of debts, such as credit card debt and medical bills. In a nutshell, after you have liquidated or cashed in your non-exempt assets most of your debts are eliminated. In Texas, most debtors have no non-exempt assets to liquidate, so most people declaring bankruptcy in Texas don't lose any property and get to keep everything they own. Chapter 7 stops creditor harassment by prohibiting creditors from contacting you once a case is filed. Chapter 13 (Wage Earner’s or Debt Restructuring Plan)
A Chapter 13 filing is designed to provide a debtor who has regular income with additional time to pay off creditors when that debtor is behind on payments. Chapter 13 bankruptcy allows you to repay creditors to the best of your ability, while retaining your property. Chapter 13 will stop a foreclosure on your home and stop the repossession of your vehicle. Payments are made to a trustee, who in turn pays the creditors each month. Some debt, but not all, will go away. Actual debts are paid, rather than the debt that was incurred as a result of interest, fines and penalties. In the case of a car, the interest and late payment fines could leave a person with more owed on the car than the car is worth. A Chapter 13 bankruptcy allows you to reduce or CRAM DOWN the amount you owe to the current market value of the car. In other words, you’d pay the cram down value on the car, plus a new interest rate of prime plus 1-3%. You must have owned the car for 910 days to cram down the amount owed, but the interest rate can be adjusted regardless of how long you have had the car. Chapter 13 may allow you to reduce or eliminate interest on certain debts and give you up to five years to repay arrears on your home mortgage or other debts. Chapter 13 also prohibits creditors from contacting you. Non-dischargeable Debt
There is some debt that will not be eliminated during a bankruptcy filing. A Chapter 7 or Chapter 13 will eliminate all debts with a few exceptions. Those exceptions are: -
Student loans -
IRS income tax debt incurred within the last 3 filing years -
Recent property taxes -
Past due (in arrears) child support, spousal support or alimony -
Secured debts -
Tax liens There are a great many benefits as well as concerns regarding filing for bankruptcy. As an experienced bankruptcy attorney, I can help guide you through those decisions to find a solution that is right for you and your family. Convenient Times and LocationI realize that not everyone can break away from their commitments during regular business hours, so I will accept evening and weekend appointments. I also realize that sometimes a bankruptcy can be an emergency situation. If your house is in immediate danger of foreclosure, I will provide same day filing of your paperwork to get the creditor protection you need. My Fort Worth law office is 1/2 mile from I-30 near Central Market. There is free parking next to the building. Don’t delay! Help is available. Call or contact us today. Michael P. O'Donnell
Attorney at Law
3450 Hulen Street
Fort Worth, TX 76107
Phone: (817) 732-7590
Fax: (817) 732-8903
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