Bankruptcy FAQs

Answer: The primary benefit of filing for bankruptcy is the time and freedom it gives you to regroup. Your creditors can be prevented from foreclosing or repossessing your property, calling you, sending you mail, or suing you. You will have the time to relax, breathe, and assess your finances. After filing, you will have time to take stock of what you need and what assets you want to keep and to plan your financial path to a brighter future.

Once you file for bankruptcy, your creditors cannot legally take any further action against you. Filing prohibits creditors from even attempting to collect any debt, and it stops current garnishment of your wages. It can help you maintain generational wealth by keeping your home. In addition, your creditors are required to deal directly, and only, with your attorney. By understanding the resources available to you, you will be able to formulate a plan to achieve your desired outcome.

Answer: Chapter 7 and Chapter 13 consumer bankruptcies both deal with debt relief, but there are certain differences in how you may be affected.

• Chapter 7 bankruptcy, also known as liquidation bankruptcy, is a way for individuals to have most of their debts forgiven (or discharged). Most individual Chapter 7 bankruptcies are completed within 90 days from the initial bankruptcy filing. At The Law Office of Donald L. Bell, we help many people obtain a fresh start through Chapter 7 bankruptcy. Let Attorney Donald L. Bell and his staff advise you about which debts may be discharged and guide you through the filing process to protect assets you want to keep and receive forgiveness of your dischargeable debts.
• Chapter 13 bankruptcy allows you to reorganize your financial affairs. If you are facing repossession of your vehicle or foreclosure on your home, a Chapter 13 filing can stop the foreclosure or repossession. Additionally, we will assist you in resolving income and property-related tax issues through a Chapter 13 bankruptcy. Reorganization through Chapter 13 generally lasts from three to five years. The bankruptcy court will appoint a trustee to represent your creditors. Attorney Donald L. Bell will aggressively and zealously represent your interests before the U.S. Bankruptcy Court in proposing and gaining court approval of your reorganization plan.

Answer: After attorney Donald L. Bell files your bankruptcy petition, the calls from collection agencies must stop. It is illegal for creditors to call or in any way attempt to collect from you after you have filed for bankruptcy. Your bankruptcy filing will also stop garnishments and other threats of losing your assets. In addition, collection agencies may not report negative information to the credit bureaus. Any of these prohibited activities are punishable by the court.

Answer: Debt collectors are subject to strict regulation, but some collection agencies simply ignore the restrictions and engage in unethical tactics. If a debt collection agency calls because they are not aware of your bankruptcy, you should give them the information about your case, and all contact should stop immediately. If you receive any contact after you inform the creditor of your discharge, you should contact your lawyer to help you protect your rights and work with you to take action against the creditor. After you complete your Chapter 7 or Chapter 13 bankruptcy, your debt is discharged.

Answer: By law, you are allowed to keep many different assets from being liquidated during bankruptcy under either federal or state bankruptcy exemptions. Allowable exemptions may include tools necessary for your profession, wedding rings, basic household goods, and a certain amount of home equity, to name a few examples.

It is important to disclose all assets when filing for bankruptcy. If you omit some property in your lists, you may lose whatever you did not disclose, even if exemption allowances might have let you keep them. Preserving property can be a great benefit of bankruptcy if you follow the rules and required procedures.

Answer: A home is your most valuable possession. Most Americans build wealth through home ownership, and losing their home can be financially devastating. Filing for bankruptcy can protect your home from foreclosure and other collection actions. Attorney Donald L. Bell will advise whether a Chapter 7 or Chapter 13 bankruptcy will best protect your home from creditors. If you are facing foreclosure, a sheriff's sale, or some other collection action, please contact us immediately to protect your most valuable asset.

Answer: Your vehicle may be your second most valuable possession. Most Americans depend on their vehicles to get back and forth to work, and losing a vehicle may also mean losing your job. Even if you are months behind on vehicle payments or in danger of repossession, a bankruptcy filing may protect your vehicle. Attorney Donald L. Bell will advise you on whether Chapter 7 or a Chapter 13 bankruptcy will best protect your vehicle from repossession.

Answer: Bankruptcy deals with tax debt differently depending on the types of taxes that are outstanding.

• Income tax debt: Income taxes can be discharged in bankruptcy, but only if a number of stringent conditions are met. Other conditions apply to the discharge of interest and penalties on your original tax debt. If you are unable to pay any income tax debt remaining after bankruptcy, you may qualify for an IRS or Maryland state tax debt relief program. It is critical to discuss your specific circumstances with Donald L. Bell, who has the experience and knowledge to recognize and resolve these very complex issues.
• Property-related tax: Because tax debt discharge applies only to income taxes, property-related taxes require special attention to ensure that you do not lose your home. Addressing property-related taxes requires the skill and advocacy of a seasoned practitioner who will work to resolve all of your financial issues.