North Oak Professional Park
3034 Mitchellville Road
Bowie, MD  20716
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Frequently Asked Questions about Filing for Chapter 7 Bankruptcy

 What is Chapter 7 bankruptcy?  A chapter 7 bankruptcy allows persons heavily overburdened with debt to walk away from it all and get a fresh start.  This includes, credit cards, foreclosure and repossession deficiencies, medical bills, civil suit judgments, garnishments, etc.

How do I qualify to file a bankruptcy?  If you have more monthly debt than income or if you can pass the new "means test", more than likely you will qualify to file a bankruptcy petition.  However, if you have other valuable assets, that could be sold, you may have to file a chapter 13 bankruptcy which is a repayment plan.  This will allow you to consolidate your bills, repay them and keep all of your assets.  This will usually only happen if you have net equity of more than $12,000.00 (per person) in your home or the value of all of your assets total more than $12,000.00. (Because of the new bankruptcy laws that took effect on 10/17/05, these issues must be discussed at length with an attorney before a final decision can be made).

What is the "means test"?  The means test is a standardized method of determining whether or not your debts exceed your income in such a way as to not raise a presumption that may be abusing the bankruptcy system.  The means test looks to IRS guidelines in determining the allowable income per household.  There are also household limits on monthly expenses such as groceries, car payments, school tuition payments, clothing, etc.  Specific information can be found on the Department of Justice Website The means test is very complicated and requires an in depth discussion with an attorney.  At your first meeting, you should be prepared to provide your attorney with various required personal documents for review.  Click here for the "Documents Needed List".

How much debt do I need to have to qualify for a bankruptcy?    There is no minimum amount of debt necessary.  Generally, you must simply show that you are unable to pay the debt that you have.

How do I get ready to file a chapter 7?  If you are absolutely certain that you will be filing for bankruptcy, stop paying your unsecured debts and gather all necessary documents.  Of course, you will continue to pay your mortgage, car note, etc. (if you want to keep them).  Also please see our "Documents Needed List".  Secondly, you will be required to obtain credit counseling before you file your case.  A list of approved credit counseling agencies can be found by visiting.  Finally, you must also prepare to pay all attorneys fees and court costs.  

   Do I have to pay all fees at once?  The policy of the Kelsey Law Firm is that no case is filed before all fees are paid.  However, you may pay half of all fees on your first visit.  Thereafter, we will prepare all necessary documents and have them ready for your signature and court filing when you return with the balance due.

What are the negatives to filing chapter 7 bankruptcy?  Of course, such a filing will be noted on your credit report for up to ten (10) years.  However, in most cases, credit is again available including car loans immediately after the case is over.  With respect to purchasing a home, you can generally expect to qualify for a mortgage after approximately 12 - 18 months.

Can the Court turn me down for a bankruptcy discharge?  Yes.  You may be denied a discharge for a variety of reasons.  Some which are an issue which could even prevent you from filing your case.  However, it is our job, to tell you whether or not your are a likely candidate before your case is even filed.  Should we determine that you are eligible, your case will proceed as long as you have disclosed all requested information, are open and honest with your attorney and have performed no fraudulent acts prior to filing bankruptcy.  Examples:  Charging up all credit cards, then filing a case a week later or taking multiple cash advances just before filing.

How long does it take to obtain my bankruptcy discharge?  The average chapter 7 case takes approximately 4 months.  This process can take longer should you fail to appear for your court date or not cooperate with any requests of the assigned Chapter 7 Trustee.

When will the creditors stop harassing me?  Along with any foreclosure, repossession, civil suit, garnishment and/or tax liens, creditors must stop all collection efforts as soon as your bankruptcy case is filed.

   Can I file bankruptcy alone?  Yes.  You may even find the appropriate forms on the U.S. Bankruptcy Court's website.  However, now that the new laws have taken affect, filing alone is risky business.  You should also keep in mind that if you have bills that are joint with another person who does not also file bankruptcy, that person remains liable for repayment of the entire debt.

Can I file bankruptcy jointly with anyone?  No.  Only husbands and wives can file a case together.

Can I file a Chapter 7 bankruptcy if I'm behind in my mortgage or car payment?  Yes, as long as you immediately catch up the payments and thereafter remain current on those items or if it is your intent to surrender your home and/or car(s).  However, if you've fallen behind and it is your intent to save your home or car, you need to file a chapter 13 case.  This will allow you to combine all back payments and unsecured debt into one lump sum and make one payment per month to the trustee for payment to your creditors.  Thereafter, you simply continue making your house or car payment as if you were current.

Note:  This information is provided for general informational purposes only.  It is not intended to provide specific legal advice concerning any one particular situation.  No two cases are alike and depending on the circumstance, filing a Chapter 7 Bankruptcy case alone can be an extremely complicated and confusing process which can have irreversible effects.  Most importantly, the loss of your home and/or car(s).   Therefore, it is always recommend that you consult with an attorney.