Reaffirming A Debt In Chapter 7 Bankruptcy
Sometimes after you file a Chapter 7 bankruptcy, a creditor will want you to reaffirm the debt. When you reaffirm a debt, you enter into a new contract with the creditor. Reaffirmation agreements commonly occur when you’ve financed a car that you’d like to keep after your bankruptcy case.
Because you are creating a new contract and a new obligation to pay after filing your bankruptcy case, reaffirmed debts are post-petition debts. Your bankruptcy will not discharge your responsibility to pay these debts after your bankruptcy is over. If you fail to make payments, the creditor has the right to sue you for the money you owe and repossess or foreclose on the property.
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How Are Utility Bills Handled In Chapter 13 Bankruptcy
Just as in Chapter 7, utility bills are considered unsecured debt in a Chapter 13 case as well, which includes all of your past due payments. However, unlike Chapter 7 cases, in Chapter 13 bankruptcies, a repayment plan will be agreed upon to pay off your debts. Depending on the plan and how much you can afford, all or only a portion of your utility debt may get paid off during your bankruptcy. Though discharge is not guaranteed, any remaining debts leftover at the end of your Chapter 13 bankruptcy generally get wiped out.
How Sawin & Shea Llc Can Help
At Sawin & Shea, we believe in providing compassionate and understanding representation to those struggling with debt and looking to file for bankruptcy. Facing utility shut off is scary. We can help guide you through the bankruptcy process so that you can get the relief you need to provide you and your family the necessities of life.
Keep in mind that the moment you file for bankruptcy, an immediate stay will go into effect to keep your service from being disconnected. This stay gives you time to get your finances in order and back on track during your bankruptcy case. Our attorneys have years of experience in bankruptcy cases and can help walk you through the process every step of the way. We can even offer guidance after your bankruptcy case has ended.
Contact us at 317-759-1483 or send us an email for a free consultation today!
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Chapter 7 Iowa Bankruptcy Basics
The most common bankruptcy filing in Iowa is Chapter 7. This is often called “straight” bankruptcy or “liquidation” bankruptcy. The purpose of a Chapter 7 bankruptcy is to get rid of or “discharge” your legal responsibility to pay certain debts, primarily unsecured credit card bills, medical bills, personal loans, debts due after vehicle or house repossession, old landlord or utility bills and, perhaps, some older tax obligations. Filing for a Chapter 7 bankruptcy in Iowa can allow for a “fresh start” with debt resolution and relief programs.
Stop A Foreclosure Repossession Or Eviction
The automatic stay will stop these actions as long as they’re still pending. Once complete, bankruptcy won’t help.
- Evictions. An eviction that’s still in the litigation process will come to a halt after a bankruptcy filing. But the stay will likely be temporary. Keep in mind that if your landlord already has an eviction judgment against you, bankruptcy won’t help in the majority of states. Learn more about evictions and the automatic stay.
- Foreclosure and repossession. Although the automatic stay will stop a foreclosure or repossession, filing for Chapter 7 won’t help you keep the property. If you can’t bring the account current, you’ll lose the house or car once the stay lifts. By contrast, Chapter 13 has a mechanism that will allow you to catch up on past payments so you can keep the asset. Find out more about bankruptcy’s automatic stay and foreclosure and car repossession and bankruptcy.
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Can You Add New Debts To Your Bankruptcy After You File
Submitted by Rachel R on Tue, 05/21/2019 – 10:41am
You can add debts to your bankruptcy in some cases
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Bankruptcy, whether you choose Chapter 7 or Chapter 13, is a great way to dig yourself out of a financial mess. But it’s pretty much a one shot deal. Think of it as a garage sale for your debt you have that one day to unload your stuff and you can’t go back and retroactively add anything to that garage sale. That’s a broad idea of how debt in a bankruptcy works. All the debt you had when the bankruptcy is filed can be part of the bankruptcy and you can’t go back and add any, as a rule. However, there are some exceptions.
When can you add debt to a Chapter 7 bankruptcy?
When you come in for your bankruptcy consultation with your attorney, you should bring in copies of all your bills and, ideally, also a recent version of your credit report. That way, you can make sure that all of your debts make it into the bankruptcy filing. But you may not bring everything or you may have a recent bill that you don’t have a copy of or that isn’t reflected on your credit report.
When can you add debt to a Chapter 13 bankruptcy?
When can you add debt to a bankruptcy after the initial filing date?
There are a few instances where you can add debts to your bankruptcy petition that were incurred after your initial bankruptcy filing date. These include:
How to avoid having to modify your bankruptcy petition
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A Licensed Insolvency Trustee Can Advise You
Does bankruptcy clear all debts? Not in all cases, but it does provide a new starting point and relief for most unsecured debts. Bankruptcy can be a complicated topic, but help is available. For more information on whether bankruptcy is a good solution for your situation, contact a Licensed Insolvency Trustee for a no-charge consultation.
It doesnt matter if you live in Toronto, Ottawa, Quebec, or anywhere else. We have licensed trustees that can help you!
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Debts You Didnt List In Your Asset Case
Contrary to common belief, not including a debt in bankruptcy isnt an option. Youre required to list all of your debts when you file for bankruptcy. If your case is an asset case , and you fail to list a debt, the omitted debt is nondischargeable.
- money owed as a result of wrongful death or personal injury to another caused by operating a car, boat , airplane , or other vehicle under the influence of alcohol or drugs.
What To Do If You Get Sued For Medical Debt
Nobody wants to get sued. Dealing with unpaid debt is a problem already and facing a lawsuit will only make things worse. Heres what you should do if youre getting sued for medical debt:
- Find out who the debt belongs to.
- Never ignore a lawsuit, regardless of the type of debt you owe. Consult a lawyer so that youll know how to proceed.
- Try to negotiate with the doctor, medical facility, or debt collector for a more favorable repayment plan.
- Prepare for the court proceedings. Dont forget to get legal representation.
- Know your rights. Did they inform you about the lawsuit? Were you served with the notice properly? If not, you can use these as part of your legal defense.
- Understand wage garnishment so that youll know what to expect if you lose the case. If the judge rules against you or if you failed to answer the lawsuit, the court may issue an order that allows the lender or collection agency to garnish your wage.
- Look for financial assistance programs.
- Consider filing bankruptcy.
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Utility Bills In Bankruptcy
Can Filing Bankruptcy Assist Me When I am not Current on my Electric and Gas Bills?
Utilities companies such as electric or gas companies have their own rules that have to be followed when a client file for bankruptcy in Maryland. Debtors are stressed out because they have are not current with all their bills including their electric and gas bills. Utilities companies rarely shut off service immediately when utility bills have accrued to a large amount due to non-payment from the debtor for extended period of time. This is a fact in the winter months when a shut off of service can threaten the life of the children and elderly. There are debtors who lost their jobs with a notice turning off their utilities with a bill from $3,000 to $5,000 outstanding balance after a frigid winter or a winter with several polar vortexes in Maryland.
If the utility company requests an unreasonable amount as a deposit, you can ask a Maryland Bankruptcy lawyer who can help you request the bankruptcy court for assistance in setting a reasonable deposit. There are occasion where the utility company may request a high deposit because some clients performed some illegal activities such as stealing water or electricity from their neighbor. In alternative, the debtor broke the meter, so the utilities companies could not monitor the amount of utilities used and does not bill appropriately. These types of conduct can give the debtor a difficult time setting a reasonable amount as a deposit.
Wipe Out Credit Card Debt And Most Other Nonpriority Unsecured Debts
Bankruptcy is very good at wiping out unsecured , medical bills, overdue utility payments, personal loans, gym contracts. In fact, it can wipe out most nonpriority unsecured debts other than school loans.
The debt is unsecured if you didn’t promise to give back the purchased property if you didn’t pay the bill. By contrast, if you have a secured credit card, you’ll have to give the purchased item back. Jewelry, electronics, computers, furniture, and large appliances are often secured debts. You can find out by reading the receipt or credit contract.
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Your Bankruptcy Situation Will Be Unique To You
Everyones debt situation is different. You must inform your attorney of any prior bankruptcy filing in the United States, regardless of where it was filed, as this may affect your ability to obtain bankruptcy protection or a discharge. Failing to tell your attorney of prior filings also impacts that attorneys ability to strategize and get you the best result you can hope for.
The Law Offices of David M. Offen have handled over 11,000 Chapter 7 and Chapter 13 Bankruptcy cases covering nearly every possible type of situation. You can call Attorney David M. Offen to discuss your specific situation and get advice on how Bankruptcy can help you turn your financial life around, even if you have already filed for Bankruptcy relief in the past.
Getting Utilities After Bankruptcy
When a person discharges past-due utility bills in bankruptcy and later seeks to establish utility service at a different location, it is possible that the utility company will require the security deposit payment. This right to require a security deposit is not always enforced. Ive seen numerous situations where my clients have been able to discharge past-due utility bills and establish new service at a different address after their bankruptcy without paying a security deposit.
Adequate Assurance of Utilities
Adequate Assurance of Utilities under the Bankruptcy Code gives debtors protection against post-petition disconnection of services through providing utility providers with an adequate assurance of payment. So, like the automatic stay prevents other creditors from collecting once a bankruptcy case is filed, the utility services cannot be shut off either for a consumer filing bankruptcy.
If you owe back payments on utility services and you file for bankruptcy, the utility company cannot refuse or cut off your service. This is prohibited in a different section of the bankruptcy code than the stay on repayment of debts . It also prohibits utility companies from refusing service just because they filed for bankruptcy.
Utility company can request adequate assurance of payment but often does not
Summary
The past due utility bills are unsecured debts, wiped out in Chapter 7 and paid as low priority debt in Chapter 13.
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Homeowner’s And Condominium Association Fees In Chapter 7 Bankruptcy
Whether your bankruptcy will discharge HOA or COA dues and assessments will also depend on when you incurred them. But there’s a twist. Relinquishing the property in the bankruptcy case won’t automatically stop your responsibility to pay.
Pre-petition assessments. You can discharge your liability for HOA or COA assessments if they became due before filing your bankruptcy petition.
Post-petition assessments. You’ll remain personally liable for any dues or assessments that become due after filing the petition, even if you end up giving up your condo, townhome, or home as part of your bankruptcy case. You’ll remain responsible as long as you remain on title as the owner. Because of this, some people wait to file for bankruptcy until after a lender repossesses the property.
You Did Not Receive A Discharge In Your First Chapter 7 Bankruptcy
If you filed a Chapter 7 Bankruptcy Petition and did not receive a discharge or your case was dismissed, you can typically file another Chapter 7 petition at any time as long as your first case was not dismissed for reasons of abuse or there is an order barring you from refiling a new case.
A Chapter 7 case may not receive a discharge if there are issues that prevent you from completing all the required steps necessary in your case. For example, you may not receive a discharge if:
- you are sick and do not attend the meeting of creditors or get excused from attending the meeting of creditors
- you are unable to get in contact with your lawyer
- you fail to complete the credit counseling prior to filing
- you fail to complete the financial management course
- You fail to meet any other filing requirement or requirement of the Court or the Chapter 7 Trustee.
If your first case was dismissed and you attempted to comply with what you were supposed to do, then you should be able to file a Chapter 7 Bankruptcy case again. In some cases, The Bankruptcy Court may issue a Court Order which prevents you from filing a new case for a period of six months for example, before you are permitted to file for relief again.
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What Happens To Utility Bills After Bankruptcy
Its important to keep in mind that current and future utility payments will not be discharged during your bankruptcy. After you have filed, you must continue to make payments to avoid disconnection in the future. You should have no issue continuing to receive service through your same provider so long as you keep up with payments.
The Automatic Stay In Bankruptcy
Under bankruptcy law, once you file a petition for bankruptcy protection, an automatic stay goes into effect preventing creditors, including utility companies, from making efforts to collect on past debts. The automatic stay prohibits utility companies from turning off service, calling you, sending collection notices, or engaging in other communications with you about the debts owed. In some circumstances, you may be eligible to have previously disconnected utility services restored after filing for bankruptcy. However, in order to receive services, you may be required to pay a deposit to the utility company. If the utility already has a security deposit from you, they are not required to return it.
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Will Bill Collectors Keep Calling After Bankruptcy
The automatic stay which is effective upon the filing of the bankruptcy prohibits bill collectors from calling or contacting you. If the creditor continues to contact you after it has been put on notice of the bankruptcy filing, the creditor can face financial penalties and be sanctioned by the bankruptcy judge, along with you potentially being award substantial amounts of money by the Court.
Can I Hide My Assets Before Filing Bankruptcy
Some people who have debt problems incorrectly believe that if they transfer a house or other asset into someone elses name that no one can go after the asset. Intentionally transferring valuable assets out of your name and not getting paid the fair market value can be considered a fraudulent transfer that can be undone by the Bankruptcy Court. In addition without having transferred the asset, you may have even been able to exempt the property in the Bankruptcy case from any creditors. It is very important to have the correct bankruptcy information if you are considering filing bankruptcy.
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Chapter 7 Gets Rid Of Credit Card Debt And Judgment Debts
When you file a Chapter 7 bankruptcy petition, you include all your debts. A Chapter 7 case discharges most, if not all, unsecured debts, including credit card debts and personal judgments from debt collection lawsuits.
You receive a bankruptcy discharge when you complete your Chapter 7 case. The bankruptcy discharge relieves your responsibility to repay a debt. In other words, if a debt is discharged in bankruptcy, you are not responsible for the payment of that debt. The creditor is not allowed to take any actions to collect a discharged debt.
Examples of debts that are eligible for a discharge in Chapter 7 include:
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Old rent or lease payments
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Medical bills and debts
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Some old income taxes
Alimony, child support, and student loans are non-dischargeable debts. In a few cases, a debtor may be eligible for a hardship discharge for student loan debt. But alimony, child support, and a few other debts are never dischargeable in bankruptcy.
