FAQ

Bankruptcy

Who can file for bankruptcy in Idaho?

A consultation is necessary to determine whether or not a bankruptcy is even a good idea.  For the most part, bankruptcy is available for all people and entities, it is just finding the right chapter to make the right fit. (learn more)

What is Bankruptcy?

Bankruptcy is a Constitutional provision that allows people to discharge (receive forgiveness) of some or all of their debt. Various chapters of bankruptcy exist for myriad circumstances. Individual circumstances will dictate the chapter and treatment, reorganization, or ignoring of debt. (learn more)

What is an Automatic Stay?

The filing of bankruptcy provides an automatic pause in all collection activity against a person.  It stops governments, creditors, even friends in any attempt to collect.  This breathing room provides an opportunity to review the assets and debts and to plan a course of reorganization for the future.  It is of great help, but its abuse can include serious punishments. (learn more)

What About Divorce?

Divorce is one of the top reasons for bankruptcy.  It is not uncommon to see a divorce affected by a bankruptcy and a bankruptcy affected by a divorce.  Divorce compounds a bankruptcy with a new set of rules to govern the long-term outcome.  Usually the reasons why a person is filing bankruptcy now will determine what type of resolution is sought with regard to divorce debts.  Many of the basic rules of bankruptcy are altered by a divorce and the reach can extend for many years. (learn more)

What About Debt Consolidation?

Many entities advertise debt consolidation as a viable and required alternative to bankruptcy.  Debt consolidation has a time and place and for those seriously considering bankruptcy, the debt consolidation option is likely too late.  Don’t rule out the options, but some number crunching can fairly quickly indicate whether consolidation is really an option. (learn more)

What About a Deficiency Claim?

The dreaded deficiency haunts so many people after repossession and sale of collateral.  But once the collateral is gone, it is just another debt treated like all the rest and usually has very little bite in bankruptcy.  Other types of debt are much more menacing than a deficiency. (learn more)

Must I Have an Attorney?

Bankruptcy is a complex area of law in which a mistake could be costly.  It is not usually recommended that individuals attempt bankruptcy on their own without legal counsel.  Some chapters are easier to navigate independently than others but one will spend large volumes of time to avoid common pitfalls that even unwary attorneys fall into from time to time.  You can do it but expect an investment of time and resources to do it successfully. (learn more)

Is Bankruptcy Morally Wrong?

Bankruptcy is as American as Apple Pie but many people struggle with a stigma that seems to come along with it.  Our founding fathers and Congress to the present time permit people to avoid financial slavery under the guidelines they determine.  Bankruptcy is a moral option for all parties involved. (learn more)

How Does Bankruptcy Help in Credit Scores?

Bankruptcy both helps and hurts your credit.  Filing alone will ding your credit, but the long-term effect is much more beneficial than the short-term negative point drop to credit. (learn more)

Do I Have to List All Property?

When a person files bankruptcy it is as though the person died.  An estate is created in which everything a person owes and owns becomes property of the bankruptcy estate.  All debts and assets are required to be listed.  Failure to do so could have serious results, even criminal.  Always err on the side of listing too much rather than not enough. (learn more)

Do I Get to Keep Some of My Property?

Whether a person gets to keep their property depends on many factors.  Usually in Idaho an individual gets to keep all their personal property and their home.  The only items typically lost is excessive property, like 5 automobiles, 4-wheelers, snowmobiles, and various items that are more hobbies than required for maintenance of the home.  But in some chapters even those items can be kept if the numbers play out right for creditors.  Review with counsel can usually predict which property will be lost or needs to be disposed before filing. (learn more)

Can Bankruptcy Stop a Foreclosure?

Bankruptcy is strong enough to stall a foreclosure but should be used prudently.  How you choose to reorganize in bankruptcy determines whether or not you get to keep your home or just delay the inevitable.  But breathing room is a large perk in bankruptcy which helps pause or stop a foreclosure. (learn more)

Am I Required to do Credit Counseling?

Congress has again decided they are infinitely wiser than the rest of us.  Here is how that plays out: Before you can even file your bankruptcy you have to certify completion of credit counseling course.  The nice part is that it can be done online quickly and inexpensively. (learn more)

Am I Forced to Give Up My Tax Refund?

Tax refunds are an interesting form of property treated differently by most states.  In Idaho there are very limited protections on tax returns so they are often turned over to the bankruptcy Trustee to be shared with creditors.  Size, amount, and where they come from are all determining factors on how much, if any, a person will get to keep. (learn more)