Questions to Ask Your Lawyer About Bankruptcy

Considering Filing for Bankruptcy? Here Are the Questions to Ask Your Bankruptcy Lawyer

You’ve been working hard to get your financial life back in order, but still can’t see any light at the end of the tunnel. You’re thinking maybe it’s time to consider filing for bankruptcy, but you are uncertain what that means, now and in the future. Here are the key questions to ask a bankruptcy attorney.

  • What are your qualifications? Before you hire a bankruptcy lawyer, find out how much experience they have, what types of bankruptcy proceedings they have handled and how well they have worked with others.
  • What are my options in bankruptcy? There are different approaches to bankruptcy. Chapter 7 allows you to permanently discharge most debts. In a Chapter 13 proceeding you have to make monthly payments to a Chapter 13 trustee who will distribute that money to your creditors over a three to five year period. A Chapter 13 bankruptcy case can also be used to catch up on missed mortgage payments, stop a foreclosure, or get back a car that has been recently repossessed.
  • Do I qualify for Chapter 7 protection? Under the 2005 revisions to the bankruptcy laws, to qualify for Chapter 7, you must demonstrate to the bankruptcy court that you lack the means to pay off your debts over a three-to-five year period. Your attorney should be able to walk you through the means test, provided you supply accurate financial information. Most people who are considering filing a Chapter 7 bankruptcy are eligible for Chapter 7.
  • If I file Chapter 7, can I keep any assets? The federal bankruptcy laws allow certain exemptions when you file for protection under Chapter 7. Each state has its own set of exemptions. You can choose one or the other. As a practical matter, nearly 98% of all people who file a Chapter 7 bankruptcy are able to keep everything that they own, including their houses and their cars.
  • What debts can I discharge? Most debts can be discharged in bankruptcy. However, not all debts may be discharged in a Chapter 7; certain tax obligations, child support arrearages and student loans are typically not dischargeable.
  • What information do I need to provide? You will be required to make an accurate and complete disclosure of your assets and liabilities as well as your monthly income and expenses. Your lawyer can work with you to collect all the documents necessary for a bankruptcy filing.
  • What is the cost? The cost for filing a bankruptcy case varies based on the complexity of the case. Between court costs and attorney’s fees, a standard Chapter 7 case can cost between $1,500 and $2,000. This amount is usually only equal to a small fraction of the debt owed.

Contact John Hargrave and Associates

We have provided comprehensive counsel to individuals in and around Barrington, New Jersey, since 1977. To schedule a free initial consultation, contact our office by e-mail or call us at 856-547-6500.


  1. My best friend has had to file for bankruptcy, and I know nothing about it. I appreciate your help in understanding that if you file a Chapter 7 bankruptcy, your house and you cars can be taken as well. This is something I didn’t know, but hopefully this won’t be the case for my frie

    • JHargraveAssoc says:

      The answer depends on several things. First, if you are financing the purchase of the car or the house, and you are behind in your payments, the mortgage company and the car lender have a contract right to foreclose or re-possess the thing you financed with them. They cannot do this while your bankruptcy case is pending until they get permission from the court to take that action. This is called getting “relief from the automatic stay”.

      If you are up to date on your payments or you own the house or car outright (no liens) then you have to look at 2 more issues. First, how much equity do you have in the house or car. Equity is calculated by subtracting from the value of the house or car any lien on it. For example, house is worth $100,000 and has a mortgage with a balance of $110,000 or you own a car worth $12,000 but you owe $16,000. In each case you have no equity in the house or car since you owe more on it than it is worth. In this case you get to keep the house or car as long as you stay up to date on the payments.

      If you are up to date on your payments but the house or car are worth more than what you owe on them, you have equity in those things. Now the answer to the question depends on how much equity AND the state where you live. You are allowed to keep/protect things with equity up to a certain maximum. How much this is depends on your individual state. Now the answering this question cannot be done in a short response like this. You will need to speak with an experienced bankruptcy lawyer to answer this final question.

      John Hargrave
      Barrington, NJ

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