Will Filing Bankruptcy Prevent Me From Getting Credit?

No.  Many people believe their credit will be ruined for years after filing bankruptcy.  While it’s true that the fact of a bankruptcy filing can remain on your credit report for 7 to 10 years after you file, a steady history of current, on time payments is more important than a prior bankruptcy.  Creditors will look at how you have handled credit after your bankruptcy case was completed.  Creditors and lenders are more concerned about your current status and current payments than the prior bankruptcy.  Establishing a record of timely payments will lead to positive credit information on your credit reports.  Many of my clients purchase new homes, vehicles, and qualify for credit cards a few months after their bankruptcy is concluded.  In fact, many creditors will start offering credit right after the discharge.  While interest rates may be higher, you can still get credit, despite a bankruptcy filing.  You can usually expect it to take between 12 to 24 months after the case is concluded to be able to obtain credit at regular interest rates.

After receiving your bankruptcy discharge, you should obtain a copy of your credit report from all three credit reporting agencies--Experian, Equifax, and TransUnion.  Review the information, and ensure that all debts are listed as “Discharged in Bankruptcy” on the reports with a zero balance.  The credit reporting agencies are required by law to have accurate information, and ensuring that these debts are listed as discharged can actually help your credit to debt ratio, one of the factors evaluated in a credit score.

If you are struggling with your finances and need a rapid way to eliminate your debts, bankruptcy may offer the relief you seek and a path to re-establishing your credit.  As an experienced and dedicated Fort Worth bankruptcy attorney, I can offer advice on how to proceed based on your particular situation. You and I can meet face to face to discuss your options.  I look forward to helping you become debt free.  To schedule a FREE consultation, please contact me at (817)-732-7590 or (972)-819-3861.  You can also send me an E-mail or complete the Free Case Evaluation.

Will Filing Bankruptcy Affect My Credit Score?

One issue that discourages some people from filing bankruptcy is the potential detrimental effect it may have on their credit.  It’s true that a bankruptcy can stay on your credit report for up to ten years and it can hurt your credit score.  However, the majority of bankruptcy filers have a below-average credit score at the time of filing.  For these clients, filing bankruptcy can actually make their credit score go up because they are discharging debt; the amount of debt you carry determines, in part, your credit score.  Many of my clients have seen their credit scores increase by over 100 points after their bankruptcy was completed.  If you do start with a higher than average credit score, you can expect your score to decrease when you file bankruptcy.  Generally, the higher the score, the more it will decrease.  However, not filing bankruptcy and allowing your debts to go to collections will also negatively impact your credit.  Just a few unpaid debts can make your credit score drop dramatically.  Nevertheless, most people can re-establish their credit within 12 to 24 months after their bankruptcy case is completed.

If you have more questions about your credit score and the effects of bankruptcy on your credit, I will be happy to answer these questions.  As an experienced and dedicated Fort Worth bankruptcy attorney, I can offer advice on how to proceed based on your particular situation.  You and I can meet face to face to discuss your options.  To schedule a FREE consultation, please contact me at (817)-732-7590 or (972)-819-3861.  You can also send me an E-mail or complete the Free Case Evaluation.


Will I Lose My House If I File Chapter 7 Bankruptcy?

When people consider the possibility of bankruptcy, they are often concerned about losing some of their assets. In particular, we are sometimes asked whether people will lose their house if they file a Chapter 7 Bankruptcy. In Fort Worth, filing a bankruptcy does not mean you will automatically lose your house.

Texas has a favorable homestead exemption. If your house is your primary residence, it will be exempt from creditors as your homestead. That being said, it is important to remain current on your mortgage payments. While most of the debts generally get discharged in a Chapter 7 Bankruptcy, you will have the option to reaffirm your obligation under the mortgage and remain responsible for that debt. Typically, a Reaffirmation Agreement is entered between the mortgage company and the debtor, which allows the debtor to remain personally liable for the mortgage debt after the bankruptcy case is closed. The debtor continues to make their regular mortgage payments and retains the property.

In certain situations, debtors may choose not to enter into a Reaffirmation Agreement with the mortgage company. Debtors who do not enter into a Reaffirmation Agreement will have their personal obligation under the mortgage discharged through their bankruptcy. However as long as the debtor remains current on their mortgage and continues to make their monthly payments, they can usually keep their house as well, although there are some drawbacks.

For more information about how a bankruptcy may affect your house or about Reaffirmation Agreements, contact an experienced Fort Worth bankruptcy lawyer. If you would like a free consultation with an experienced and dedicated Fort Worth bankruptcy lawyer call Michael P. O’Donnell at 817-732-7590 or 972-819-3861, or E-mail me at mpolawfirm@hotmail.com.


Can I Eliminate Taxes In Bankruptcy?

As a Fort Worth bankruptcy attorney, my clients are often surprised to find out that some taxes are dischargeable (eliminated) in bankruptcy.  Generally income taxes are dischargeable if they meet certain requirements.

  1. They must be for a tax year for which the return was due more than 3 years prior to filing bankruptcy.  Example: Today is November 30, 2016.  Taxes for the year 2012 were last due on April 15 or October 15 (extension date), 2013.  Therefore they meet this timeline.
  2. The tax return must have been actually filed by the debtor and have been on file with the IRS for at least 2 years.
  3. Any assessment the IRS makes must be at least 240 days old plus any time an offer in compromise was outstanding.
  4. These times may be extended for any period in which the debtor was previously in bankruptcy.
  5. An IRS tax lien has not been filed.
  6. No fraud can be involved.

Some taxes are not dischargeable. For example, taxes assessed against you for money you withheld from your employees, but didn’t pay to the IRS. In addition, the 5th Circuit Court of Appeals has held that if you filed the tax return after the extension date, the tax is not dischargeable, although there may be an exception in some cases.

Be sure to talk to a Fort Worth bankruptcy attorney about taxes. If you would like a FREE consultation with an experienced and dedicated Fort Worth bankruptcy attorney call Michael P. O’Donnell at 817-732-7590 or 972-819-3861You can also send me an E-mail or complete the Free Case Evaluation.  I can answer your tax questions.


Benefits of Hiring a Bankruptcy Attorney

If you are feeling overwhelmed by your financial situation, then you may want to consider filing a chapter 7 or Chapter 13 bankruptcy. Filing for bankruptcy can provide you with the relief and time that you need to get back on your feet and to begin feeling at ease in life once again. A Fort Worth bankruptcy attorney can help you begin the process of gathering paperwork, scheduling necessary meetings, and filing the appropriate documents with the court for your bankruptcy case.

Debtors find that they often feel a sense of calm after filing for bankruptcy. Under a Chapter 7 bankruptcy, debtors are no longer required to repay a majority of their debts. In addition, one can still enjoy ownership of certain forms of property. You are allowed to keep certain property that is considered “exempt”. Texas law offers more exemptions for debtors than most other states. Filing for bankruptcy in Texas can be a very smart option for people who are financially strapped for cash and unable to meet their monthly obligations. In the beginning stages of a bankruptcy filing, a bankruptcy attorney will help you figure out which types of property are included in the bankruptcy estate. The bankruptcy estate is the total sum of assets that will be used to repay creditors. A trustee is in charge of distributing the assets contained in the bankruptcy estate. The trustee is a neutral, third-party in your case. 

Texas offers several classes of exemptions that debtors can benefit from in their bankruptcy case; as an experienced Fort Worth bankruptcy attorney, I will analyze your property holding and figure out which asses are exempt in Texas. A single person is able to keep certain property that has a value of up to $50,000. A family is able to keep property that has a value of up to $100,000. Certain tools and equipment that are used in one’s profession may be exempt in a bankruptcy filing. Any equipment that is used for farming purposes is exempt from a bankruptcy estate. Under Texas Law, your homestead, certain insurance and certain retirement plans can be unlimited in value.

Other notable exemptions include a motor vehicle for each member of the family, a limited number of farm animals and wages for personal services. Clothing is also totally exempt in the state of Texas. These exemptions are liberal in comparison with other states that allow only a small amount of the value of one’s wardrobe, professional equipment and motor vehicle to be exempt property.

There are also Federal Bankruptcy Exemptions. In Texas, you can choose one or the other, but not both. While the Texas Exemptions are very generous, in certain cases, it may be better to claim the Federal Bankruptcy Exemptions. An experienced Fort Worth bankruptcy lawyer will be able to assist you in choosing the exemptions that are best for you. In most instances, all of your property will be exempt.

By hiring an experienced Fort Worth bankruptcy attorney you can rest assured, that you will be in good hands. Rather than dealing with the stress of a bankruptcy by filing alone, I will provide you support during the time when you need it most. I will attend all meetings, such as the 341 meeting with you. You will not have to worry about being left to deal with difficult creditors because I, Michael P. O’Donnell, will be your advocate at all times.

For a free consultation with an experienced Fort Worth bankruptcy attorney, call Michael P. O’Donnell at 817-732-7590 or 972-819-3861 or E-mail me. I can help you.

Can I Buy A Home After Filing Bankruptcy?

Some people believe that once you file for bankruptcy you cannot get a home loan. This is a terrible misconception that prevents many people relief under the United States Bankruptcy Code. Filing a bankruptcy and receiving a discharge, whether Chapter 7 or Chapter 13, does not create a barrier to home ownership if the individuals are otherwise able to become credit worthy in the future.

Nothing prevents a bank from loaning money to a person who files for bankruptcy. Although the interest rate may be higher, the lender simply wants a guarantee that it will get paid on the loan over time. In most cases the guarantee comes from the federal housing administration (FHA), a government agency that insures home loans. In other cases, you may qualify on your own with a few more restrictions than other homeowners.

Under the FHA, you can obtain a home loan after a Chapter 7 bankruptcy if (1) more than 24 months have passed since your bankruptcy discharge; (2) you do not have outstanding tax liens with the Internal Revenue Service; and (3) at least 3 years have passed since any foreclosure or a deed-in-lieu of foreclosure has occurred.  

A Chapter 13 debtor can apply for an FHA guaranteed home mortgage during the Chapter 13 bankruptcy process. Since you have a record of responsibility for your debts after bankruptcy, the FHA only requires a 12-month wait from the date you began making your payments. These payments must be on time and according to your bankruptcy plan. You must also have permission from the court allowing the new mortgage.

Numerous debtors are able to purchase a home after a bankruptcy discharge. In some cases, you can obtain a new home during bankruptcy. If you are currently struggling with overwhelming debts  and hope to qualify for a mortgage in the future, please call my office to discuss your situation. At the Law Office of Michael P. O'Donnell we are here to help. Call me today at 817-732-7590 or 972-819-3861 or send me an E-mail to set up your free legal consultation. As an experienced and caring Fort Worth bankruptcy lawyer, I can help you with your debts and answer your questions about buying a home after filing bankruptcy.

What Type Of Bankruptcy Should I File?

Individuals typically file Chapter 7 or chapter 13 bankruptcy. The type of bankruptcy filed is determined by the type of relief you are seeking. When a debtor files for Chapter 7 or Chapter 13, their creditors are prohibited by law from attempting to collect any debts from the debtor. This is called an "automatic stay." 

In a standard Chapter 7 bankruptcy all of a debtors unsecured debt-debt without collateral or security-is discharged, or wiped out. The primarily consists of credit card debt, lines of credit, and medical bills. In most cases of Chapter 7 bankruptcy, all property is exempt, and debtors may keep possession of their property. These bankruptcy cases are called no-asset cases.

A Chapter 13 bankruptcy is frequently used by individuals who want to catch up on past due home mortgages or auto loan payments and keep ownership of their car or home. Other individuals use Chapter 13 to pay off debt to the IRS on more favorable terms.  In Chapter 13 a debtor proposes a plan to pay all or part of the debts over a three to five year period. So long as the debtor makes these required payments, he or she will be able to keep their property.

For a free bankruptcy  consultation to learn more about discharging medical debts through Chapter 7, contact experienced Fort Worth bankruptcy attorney Michael P. O'Donnell via phone at 817-732-7590 or 972-819-3861 for a free legal consultation. Michael can also be reached by E-mail at mpolawfirm@hotmail.com.


Can I Eliminate Medical Bills In Bankruptcy?

An illness can be one of the of the most devastating and costly life events. It can effect anyone at any time. Unfortunately, many people are unaware that even if you are lucky enough to have health insurance coverage, not all medical costs may be covered. Therefore, you can end up with huge medical bills and limited funds to pay them.

As a result, a substantial number of people in Fort Worth as well as many other parts of the country are filing for Chapter 7 bankruptcy to eliminate medical debts. When you file for Chapter 7, your medical debts are discharged and you almost always get to keep all of your property. The process takes approximately four months and you can immediately start rebuilding your credit afterward.

Although the initial filing requirement is simple enough--you have to have property in the filing district and division, or have lived there for the majority of the last six months--there can be complex issues that may require the assistance of a Fort Worth bankruptcy attorney. For example, you may be wondering when to file. A general suggestion is to not file until all anticipated bills have been incurred. If you are still sick and require expensive medical care, the filing should be delayed. A consultation with a Fort Worth bankruptcy attorney can explain these and many other issues in more detail.

For a free bankruptcy  consultation to learn more about discharging medical debts through Chapter 7, contact Fort Worth bankruptcy attorney Michael P. O'Donnell by phone at 817-732-7590 or 972-819-3861 for a free legal consultation. Michael can also be reached by E-mail at  mpolawfirm@hotmail.com for more information. 

Bankruptcy Can Stop The Foreclosure Of Your Home

For most Americans, their home is the most expensive and most important asset they possess. It is no wonder that many Americans are turning to bankruptcy to save their home from foreclosure. As soon as bankruptcy is filed, all collection attempts must immediately cease. This includes foreclosure actions and attempts to collect on mortgage loan default. Additionally, unsecured debt the homeowner holds will be discharged, freeing up income to catch up on a home loan and get back in the black.

More and more people are turning to a Fort Worth bankruptcy attorney to help them avoid foreclosure. By filing for bankruptcy, you can save your home and get back on track financially. Whether you are dangerously close to getting your first notice or have already started receiving them, a Fort Worth bankruptcy attorney can help you. By assessing your current financial circumstances and future income, a bankruptcy attorney can decide whether filing for bankruptcy can stave off the foreclosure process.

While many people file for Chapter 7 bankruptcy to help them erase debts, this might also force them to sell off certain assets to do so. By filing for Chapter 13 bankruptcy instead, you can restructure your debts and keep your assets, such as your home. If you are forced to go through foreclosure proceedings, you may be left without a home and still owe a balance to the mortgage company. A foreclosure may result in the mortgage company issuing a 1099 report of miscellaneous income to the IRS, requiring you to report forgiveness of debt as income. If your home sells at foreclosure for less than its loan payoff, the mortgage holder may seek a deficiency judgment against you. A judgment can stay on record for 10 years and can be renewed for another 10 years. I can help you stop these consequences from happening, even if you decide not to keep your house.

For a free consultation, contact me, Fort Worth bankruptcy attorney Michael P. O'Donnell, via phone at 817-732-7590 or 972-819-3861. I can also be reached by E-mail to discuss what legal steps you should take to avoid foreclosure altogether.