Recent FAQs

What are the common exemptions claimed by North Carolina debtors?

In bankruptcy, exemptions function as property allowance which enable a debtor to keep property through bankruptcy. Each state has its own exemption under state law, and there are also federal bankruptcy exemptions that are applicable in some situations. There are timing requirements not discussed in this answer, but residents of North Carolina will typically claim North Carolina Statutory exemptions. Several are very frequently claimed, including the homestead exemption, the motor vehicle exemption, the household property exemption, and the wild card exemption.

Can bankruptcy get rid of student loans?

In short, no. Student loans, both federally backed loans such as perkins, stafford, and PLUS loans and private student loans, are presumptively non-dischargable. A non-dischargable debt is not affected by the bankruptcy discharge, and the debtor remains liable on the debt after bankruptcy.

How can I keep property that I cannot exempt?

Exemptions are powerful property allowances that permit many debtors to keep most or all of their property in bankruptcy. However, some exemptions are limited in dollar value and cannot completely protect property from bankruptcy. Fortunately, there are options. Chapter 13 bankruptcy allows debtors to keep their property, paying an amount equal to the non-exempt value of their property over up to 5 years. In some cases, the plan will already require a greater payment amount and keeping the property will add no extra cost.

Can I keep my car in bankruptcy?

Many debtors are able to keep their cars in bankruptcy. The basic strategies for keeping an automobile depend primarily on the value of the car, the existence and amount of a car loan, and the bankruptcy chapter chosen. Please contact our bankruptcy attorney to discuss the particulars of your situation.

Can a Discharge be Revoked?

There are certain very particular reasons why a bankruptcy discharge can be revoked.

Why do I need to bring 6 months of pay stubs?

We need six or more months of pay stubs as part of determining your gross income over the last six months. It's also helpful to understand the exact paycheck deductions currently being made. A debtor's 6-month average current monthly income is computed for determining whether a debtor is above median household income, such that statutory means testing applies. If means testing applies, this average income is compared against expense allowances for determining formulaic ability to pay creditors. This ability to pay affects eligibility for chapter 7 and the required payment in chapter 13.

Why does joint debt matter?

One item of information we need about each of your debts is whether anyone else signed for or is otherwise responsible for a debt. This information needs to be disclosed in the bankruptcy petition. As a matter of bankruptcy planning, a determination must be made about what is likely to happen to the co-obligor once you file, and whether such is a cause for concern to the debtor.

What is the concern with transfers?

Bankruptcy attorneys and trustees are always asking about transfers of property, particularly in chapter 7 cases. Why do they care? A principal purpose of bankruptcy is to ensure a fair distribution amongst a debtor's several creditors. To that end, there are two kinds of pre-bankruptcy property transfers that can be a particular source of concern:

I have filed bankruptcy before, can I file again?

The most important aspect of filing a second bankruptcy is generally whether or not a discharge can be obtained. If no discharge is available due to timing, the bankruptcy will not be successful in eliminating personal liability on debts. The frequency with which a debtor can obtain bankruptcy discharges is limited by statute.

What is a discharge?

A bankruptcy discharge is granted by the bankruptcy court and serves as a permanent injunction against collecting certain past debts from the debtor personally. The discharge is the legal vehicle that grants the debtor a fresh start and wipes out past debts. Having a discharge granted is a goal of most bankruptcy filings.

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