Frequently Asked Questions

Q. CAN I FILE FOR BANKRUPTCY?

A, YES! YOU CAN FILE FOR BANKRUPTCY
Anyone who could have filed a bankruptcy before can still file one. For most people, the changes require more paperwork but that is about all. Our staff is ready to help you through it.

Q, FORECLOSURE - HOW DO I SAVE MY HOME?

A. STOP THE FORECLOSURE BY FILING BANKRUPTCY.

A wage earner plan (Chapter 13 Bankruptcy) is your best option. Over the course of 36 – 60 months you would pay off the delinquent payments in monthly installments. You can also pay off delinquent real property taxes through a Chapter 13 payment plan.

Q. WILL I LOSE MY CAR?

A. YOU CAN KEEP YOUR CAR.

In most cases you will be able to keep your car by continuing payments on the financing agreement you already have. If you are behind in your payments, it's a little more complicated, but you can still probably keep the car. You will need to either make up the missed payments or work out an agreement with the lender, either before or after filing bankruptcy.  A cramdown in Chapter 13 Bankruptcy may still be available. The criteria are

1. Used in Business: if your vehicle is used by you in your personal business, it may be subject to Cramdown. If so, the amount you owe above the vehicle's value can be treated as an unsecured debt in Chapter 13 Bankruptcy. You would pay the vehicle's fair market value through your Chapter 13 Bankruptcy Plan, and the balance would be discharged along with the remaining unsecured debt.
2. Refinanced Vehicle: If you refinanced your vehicle and owe more than its worth, the same Cramdown might also be available. Original purchase money financing is not subject to Cramdown unless 910 days have passed since the purchase.
3. 910 Vehicles: If you purchased the vehicles more than 910 days prior to filing bankruptcy, and you are upside down at the time of filing, the loan should be subject to Cramdown in a Chapter 13 Bankruptcy.

Q. IRS OR OREGON DEPARTMENT OF REVENUE GARNISHMENTS – CAN I STOP OR PREVENT THEM?

A. YOU CAN STOP THE IRS AND DEPARTMENT OF REVENUE FROM TAKING YOUR WAGES AND LEVYING ON YOUR BANK ACCOUNTS.

The bankruptcy law requires all creditors, including the IRS and Department of Revenue, to stop all collection activity upon your filing, including garnishments, levies and repossessions. This is referred to as the "bankruptcy stay". Most ordinary income tax debt older than three years can be erased (discharged) in bankruptcy. Even if the taxes cannot be discharged, you can force the IRS and ODR to take payments according to your Chapter 13 plan, whether they like the terms of payment or not, so long as the debt is paid off during the Chapter 13. The tax garnishment will be stopped.

Q. A CREDIT CARD COMPANY SUED ME AND NOW SAYS IT WILL GARNISH MY WAGES - CAN I STOP THEM?

A. YES, A BANKRUPTCY STOPS THE GARNISHMENT.

Filing for bankruptcy stops this kind of garnishment. Filing a bankruptcy is like putting a stop sign in front of your creditors. Unless the bankruptcy court has given permission, an attempt to collect on a pre-existing debt is a violation of the "automatic stay" and could expose the creditors themselves to sanctions by the court.

Q. WHAT IS THE "AUTOMATIC STAY" IN BANKRUPTCY?

A. THE AUTOMATIC STAY REQUIRES CREDITORS TO IMMEDIATELY STOP TRYING TO COLLECT A DEBT.

The laws which are set up in the bankruptcy system provide that, once a bankruptcy is filed, any and all debt collection efforts must stop. Those efforts include, among others, creditor phone calls, letters, lawsuits, repossessions and garnishments. An automatic stay is strictly enforced by the court. Because bankruptcy court is a federal court, it even has the power to stop proceedings pending in a state court. That is what is meant when you hear that someone has "sought protection" under the bankruptcy laws.

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