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1. How do I know if I am eligible to file a Chapter 7?

2. If I am behind on my mortgage how do I file bankruptcy and hope to keep my home?

3. What is a discharge?

4. Will my creditors keep contacting me?

5. Can I keep my home and car if I file bankruptcy?

6. Are all debts dischargeable?

7. Does my spouse have to file?

8. How often can I file?

9. What property can I keep?

1. **The eligibility to file a Chapter 7 Bankruptcy is based upon household income. The federal government has set median income standards for each state based upon the household size. Your attorney will discuss the median income for your individual household situation.

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2. **By filing a Chapter 13 Bankruptcy you have the opportunity to take up to sixty (60) months to pay the arrearage on your mortgage (or other secured debt). However, you must be able to demonstrate that you have the financial ability to make your regular monthly payment in addition to your monthly Chapter 13 Plan Payment. That Plan Payment will include a specific amount to be applied to your arrearage, as well as some percentage of your unsecured debt. Additionally, you must have current private real estate insurance. Forced place insurance is insufficient.

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3. **Under the federal bankruptcy statute, a discharge is a release of the debtor from personal liability for certain specified types of debts. In other words, the debtor is no longer required by law to pay any debts that are discharged. The discharge operates as a permanent order directed to the creditors of the debtor that they refrain from taking any form of collection action on discharged debts, including legal action and communications with the debtor, such as telephone calls, letters, and personal contacts. Although a debtor is relieved of personal liability for all debts that are discharged, a valid lien (i.e., a charge upon specific property to secure payment of a debt) that has not been avoided (i.e., made unenforceable) in the bankruptcy case will remain after the bankruptcy case. Therefore, a secured creditor may enforce the lien to recover the property secured by the lien.

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4. **Your creditors are allowed to continue to contact you up until the time that you actually file. However, once you have filed your petition all of your creditors will be notified and given your case number. Once that happens they cannot take any action to collect on the debt. This would include letters, telephone contact, the filing of legal actions, etc.

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5. **It is possible to retain assets secured by loans provided that you can maintain the payments and insurance on these items. Your attorney will advise you what payments must continue to be made after you file, and what arrearage payments, if any, must be brought current.

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6. **No. Certain debts are not dischargeable in any bankruptcy. These include:

  • debts you forget to list in your petition;
  • child support, alimony, or other court ordered support payments;
  • liability for personal injury or death caused by operating under the influence of drugs or alcohol;
  • debts incurred by fraud;
  • most student loans;
  • most tax liabilities; and,
  • traffic tickets or other criminal restitution orders

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    7. **An individual can file without their spouse if the debts are only listed in one name. If the spouse was a co-obligor on the debt they would remain liable if they do not file. Keep in mind that even if only one spouse files the bankruptcy code still requires that income for the entire household be reported.

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    8. **A Debtor may file a subsequent Chapter 7 Bankruptcy eight (8) years after receiving a discharge in a prior bankruptcy. There are some changes to this time restriction if the Debtor intends to file a Chapter 13 Bankruptcy. Your attorney will discuss how your personal bankruptcy history would impact a new filing.

    9. **Every state offers certain exemptions that allow you retain personal property and real estate. Massachusetts is one of the minority of states that allows you to elect to take the federal exemptions or the Massachusetts state exemptions. Your attorney will discuss which is most beneficial to you. Many items that are considered to be “luxuries” will not be exempt and may be liquidated by the bankruptcy trustee for the benefit of your creditors.

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