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Bankruptcy FAQ

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Bankruptcy – Frequently Asked Questions

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*We are a debt relief agency.  We help people file for bankruptcy relief under the bankruptcy code.

  1. What should I do if a debt collector keeps calling me?
  2. What types of bankruptcy are available to individuals?
  3. Can everyone file a Chapter 7 bankruptcy?
  4. How often can I file for bankruptcy?
  5. Will all of my debts go away if I declare bankruptcy?
  6. Can filing for bankruptcy help save my home from foreclosure?
  7. Can I choose to discharge some debts, but not others?
  8. How much does filing bankruptcy cost?
  9. Will I be able to obtain a credit card or a loan after I file bankruptcy?
  10. Will filing for bankruptcy ruin my credit?
  11. Should I feel ashamed about filing for bankruptcy?
  12. What are “Exemptions”?
  13. Who is the “Trustee” and what do they do?

1. What should I do if a debt collector keeps calling me?

In response to the unacceptable behavior of debt collectors across the nation, Congress passed the Fair Debt Collection Practices Act (FDCPA). The FDCPA is hyper-technical legislation that puts strict restrictions upon debt collectors. Failure to comply with even the most harmless provisions of the FDCPA leaves debt collectors liable to you for damages. If a debt collector calls you about a debt at a minimum you should:

  • Document in detail your conversation, noting the date and time of the call, substance of the conversation, who you spoke with, and the nature of the debt.
  • If this is a debt that you do not own ask for validation of the debt. Under the FDCPA debt collectors must provide you with documentation validating the debt within 30 days of the request or they cannot collect upon the debt.
  • Tell the collector, in writing, to stop calling—if you tell the debt collector in writing to stop calling you, and they call you even once, they may be in violation of the FDCPA and you are entitled to damages.  Again, you should document the call in detail.

Call us to make sure that your credit is not being affected, you are not a victim of identity theft, and to protect you from illegal debt collection practices.

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2.    What types of bankruptcy are available to individuals?

There are two types of bankruptcy available to individuals: Chapter 7 and Chapter 13.  A Ch. 7 bankruptcy, often referred to as a “straight” bankruptcy, is the most commonly filed bankruptcy.  In a Ch. 7 bankruptcy, most if not all of your debts are discharged, i.e. eliminated, within a relatively short period of time after the filing of your bankruptcy petition.  A Ch. 7 bankruptcy is the preferred bankruptcy of individuals with substantial debts, but with a modest accumulation of personal and real property.  A Ch. 13 bankruptcy is essentially a payment plan.  For a period of up to five (5) years, you will make a monthly payment of your disposable monthly income.  After the payment plan period expires, you will receive a discharge of most, if not all, of your remaining debt.

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3.    Can everyone file a Chapter 7 bankruptcy?

In 2005, Congress passed legislation making it more difficult for individuals to obtain a Ch. 7 bankruptcy discharge of their debts.  The policy behind the new legislation was to ensure that unsecured creditors would at least receive some compensation from individuals with higher incomes who declare bankruptcy.  Thus, individuals must now pass the “Means Test”, to qualify for a Ch. 7 discharge.  Your attorney will investigate your income and expenses to determine whether you pass the “Means Test” and qualify for a Ch. 7 discharge of your debts.

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4.    How often can I file for bankruptcy?

There is no set limit on how many times individuals can file for bankruptcy.  However, individuals can only receive a bankruptcy discharge of their debts every eight (8) years.  If you are experiencing financial hardship now and have filed bankruptcy within the last eight (8) years, your attorney will work with you to develop a bankruptcy plan that will stop harassing creditors, stop legal actions against you, and stop interest hikes.

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5.    Will all of my debts go away if I declare bankruptcy?

Most of the people who file bankruptcy will receive a discharge of all of their outstanding debts.  There are, however, several categories of debts that are non-dischargeable in bankruptcy.  They are:

  • Domestic Support Obligations (child support, maintenance, certain debts assumed in divorce);
  • Certain Taxes;
  • Court fines/costs/restitution;
  • Debts incurred in personal injury actions for willful or malicious acts;
  • Student Loans (dischargeable under limited circumstances)

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6.    Can filing for bankruptcy help save my home from foreclosure?

If you have fallen behind on your mortgage payments and are facing a foreclosure of your home, a Chapter 13 bankruptcy can stop the foreclosure process and get you caught up on your payments.  Upon filing for bankruptcy, the bankruptcy court issues an “automatic stay” of all collections and proceedings against you.  During your bankruptcy, no creditor can collect against you, garnish your wages, or continue a legal case against you.  Thus, if your home is in foreclosure, filing for bankruptcy will halt the foreclosure process, and give you an opportunity to get caught up on your mortgage payments so you can keep you home.

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7.    Can I choose to discharge some debts, but not others?

Absolutely.  Many people who file bankruptcy, particularly a Ch. 7, want to keep certain property secured by a loan (ex. automobiles and real estate) or keep certain debts after a bankruptcy discharge (ex. loans from family members).  Individuals can “reaffirm” a debt by entering into an agreement with the creditor promising to continue the debtor-creditor relationship, or they can “assume” the debt if the debt is unsecured.  Debts that are reaffirmed or assumed survive and individual’s bankruptcy discharge.  As a result, the individual remains liable to the creditor for the reaffirmed or assumed debt.

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8.    How much does filing for bankruptcy cost?

Depending on the nature of the debts and assets involved in the case, as well as, the Chapter Bankruptcy being filed, attorney’s fees can rage anywhere from $750.00 to $3,000.00.  Call Kaehne, Cottle, Pasquale & Associates, S.C. today and schedule a free initial consultation with our attorneys and receive a comprehensive assessment of your options.

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9.    Will I be able to obtain a credit card or loan after I file bankruptcy?

The good news is that there is life after bankruptcy.  Once you receive a bankruptcy discharge of your debts, you will immediately start rebuilding your credit.  You should be able to receive a major credit card within one (1) year after filing for bankruptcy, and a major auto or home loan within 2-3 years.  A bankruptcy discharge can remain on your credit report for up to ten (10) years, and will be a factor considered by companies in issuing you credit.  However, there are more companies than not that extend credit and loans to individuals who have previously filed for bankruptcy.

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10.    Will filing for bankruptcy ruin my credit?

If you have fallen behind on your bills and are considering bankruptcy, chances are good that your credit is probably in pretty poor shape.  Unless you get caught up on your bills and continue to make your regular scheduled payments, your credit will not improve.  Filing for bankruptcy is an effective and sure way to start rebuilding your credit.

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11.    Should I feel ashamed about filing for bankruptcy?

No.   Congress has recognized a need to offer individuals an opportunity for a financial fresh start in our highly pressurized consumer nation.  With interests rates at an all-time high, rising unemployment rates and increasing costs of living, more and more individuals are taking advantage of the relief a bankruptcy offers.  You should not feel ashamed about filing for bankruptcy; you should breathe a sigh of relief that you are moving closer to financial freedom.

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12. What are “Exemptions”?

When filing for bankruptcy, specifically a Chapter 7 bankruptcy, it is necessary to protect your real property, personal property and other possession from sale to your creditors.  Both Federal Law and Wisconsin Law allow you to protect a certain amount of equity you have in your real and personal property with what are called exemptions.  For instance, under Wisconsin Law, a married couple who file jointly for Chapter 7 can protect up to $150,000 in equity in their primary residence through the use of the homestead exemption.  In most cases, the exemptions allowed under Federal or Wisconsin Law are sufficient to protect all of your property from sale.

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13. Who is the “Trustee” and what do they do?

A Trustee is an attorney who is appointed by the Court to handle the administration of a bankruptcy case once the Bankruptcy Petition is filed.  The Trustee is essentially the intermediary between you and the Court and will be the person who ultimately recommends to the Court that you receive a discharge of your debts.  The Trustee has broad powers to invalidate previous transactions with creditors, recover property, and sell property.  While your attorney is concerned with your best interest and helping you through the bankruptcy process, the Trustee is concerned with preserving the assets in the bankruptcy estate (basically all of your real and personal property) and maximizing the distribution of that estate to the benefit of your unsecured creditors.

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Beyond Expectations

My husband had never been in any legal trouble before and we didn’t know what to do or what the process was. Attorney Kaehne was very upfront and willing to explain every step of the way. My husband can be very skeptical when it comes to trusting people with his best interest, but Attorney Kaehne always remained professional and helpful. My husband was facing the possibility of years in prison and Attorney Kaehne was able to get the matter dismissed. He will always be our first choice!

The Outcome was Far Better than I Expected

Attorney Kaehne always communicated with me on what was going on and his plans for future court appearances. The outcome of the case was far more better than I expected and am really pleased that Chad did what he did to get this issue resolved.

Treated like Family

Amazing people as well as amazing attorneys. I was always treated like family.

Not Guilty Verdict

Attorney Corey Mehlos gave my case the upmost attention. He worked very hard and many long hours on it. I was impressed with his dedication and his understanding to my wishes. Not Guilty verdict at my jury trial. I highly recommend him.

In Good Hands

One of the best things about this firm is that they are truly advocates for you in every sense of the word. They listen, affirm, and explain everything without all the jargon that can so often times come with anything regarding the legal cases. I felt supported and knew I was in good hands.

Getting Responses at 9:00 pm at Night

The best lawyer you can hire for your case! Chad was extremely helpful and polite in answering all of my questions. I was even getting responses to my emails at 9 at night. He did a great job helping me get through the legal process. I recommend him to anyone needing a good lawyer.

Keen Sense of Justice and Honesty

Amaro is a very efficient attorney with extensive knowledge of the hispanic culture and language. He has a keen sense of justice and honesty. For the years I have know him he has proven to be a source of counsel. His clients will find his humble and cordial demeanor, appealing and refreshing. This is why I would recommend Amaro to everyone looking for legal advice.

Never Stops Working

An excellent attorney. Nicholas was very helpful with our case. He excelled at explaining complex legal concepts. Very accessible, we never had an issue getting an answer to a question. I don't think he stops working. Highly recommended.

Passion and Understanding for her Clients' Wishes

Attorney Cottle helped with my immigration case, she made the whole process much less stressful and you could tell she had a passion and understanding for her clients' wishes. Great experience, would highly recommend!

Available and Responsive to Needs of her Clients

Attorney Laborde shows professionalism in everything she does. She is a thorough lawyer who honestly cares about her clients and represents them to her full ability. She makes herself available and is responsive to the needs of her clients. I would certainly recommend her family law services!

Over-the-Top Attorney

From my experience, Attorney Kelsi Cottle has been an over-the-top attorney. She keeps me apprised of my case, has answered my questions, and treats me with respect. She has been very efficient, handles things expediently, and I feel I am represented by a very sharp attorney who has my best interest in mind.