Delaware Bankruptcy Questions and Answers

What is Bankruptcy and do I qualify?

      Bankruptcy is a federal court proceeding that gives consumers immediate relief from their creditors. If your income does not meet your expenses, you may qualify for bankruptcy relief. Our firm will review your individual financial situation to determine if bankruptcy is right for you. Once you file, all creditors must stop collection activities. This is called an automatic stay.

       As an individual, you may file under one of two bankruptcy chapters:

Chapter 7 is a procedure to wipe out your debts by securing a discharge of your unsecured debts, such as credit cards and most personal loans. Most clients file Chapter 7 without losing their property. With this discharge, unsecured creditors may no longer call you, harass you or attempt to collect on your debt. You may retain your financed car by continuing to make your car payments and by signing reaffirmation papers with the Court.

Chapter 13 is a procedure to reorganize your debt. Under Chapter 13, you would pay an agreed amount to the Trustee, a Bankruptcy Court official, who distributes these funds to pay your creditors. Chapter 13 plans last for three to five years. It is often used to bring current your mortgage payments, pay your overdue taxes, cut down your financed vehicle payments, and pay pennies on the dollar for unsecured debt.

     Our attorneys can help you determine which type of bankruptcy chapter is best for your situation.

Do I have to give up my house, my car or my possessions?

     In most cases, the answer is no for both Chapter 7 and Chapter 13. If you are behind on your payments, filing a Chapter 13 bankruptcy may help you catch up on your mortgage payments and prevent a foreclosure or car repossession. For Chapter 7, Delaware’s generous exemption law permits each individual to keep $25,000 of personal property and $125,000 of equity in your home. As a result, consumers rarely lose any property under either of these Chapters.

Can I file alone, or do I have to file with my spouse?

      You can file alone or with your spouse. However, if you have joint debts with your spouse, it may be wise to file together.

How can I stop my creditors from harassing me?

      As soon as your case is filed, the Bankruptcy Court orders your creditors to stop contacting you. Mortgage foreclosures, repossessions, lawsuits and wage attachments may be stopped by filing Bankruptcy.

Do I need a lawyer to file, and if so, how much does it usually cost to file?

     The bankruptcy process is difficult, and you may lose property or other rights if you do not understand the laws. Although you are not required to have an attorney in order to file bankruptcy, we recommend you speak with one of our attorneys to discuss your situation. Since each case varies, we offer a free initial consultation to determine your needs and can quote you a fee at that time.

Can I get credit after filing Bankruptcy?

      According to Experian, your bankruptcy is listed on your credit report for 10 years for Chapter 7, and for 7 years for a Chapter 13. Under either chapter, many clients can often reestablish their credit in a reasonable period after their case is concluded. Some creditors have special programs to assist people that have filed bankruptcy in reestablishing their credit.

Does your firm handle other areas of law?

     Our attorneys handle most legal problems, including Personal Injury, Workers’ Compensation, Social Security Disability, and Wills. To learn more about your legal rights, be sure to watch our attorneys on “DE Law” airing on Monday, Wednesday, Friday and Saturday evenings on Channel 28 in New Castle County. You can also check out our firm’s main website at www.dplaw.com.

CALL TODAY FOR A FREE CONSULTATION: 888-734-8700