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Elana C. Sears
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chapter 7

“Back Door Ride Through” and Chapter 7 Bankruptcy

When it comes to a chapter 7 bankruptcy one really needs to make informed decisions, and some decisions just require an attorney’s expertise and guidance.  Just because something may be acceptable as a standard practice that doesn’t mean it will be seen that way by the all knowing eyes of the judicial system.

For example, one important, confusing, and often overlooked area in the bankruptcy process is that of re-affirmation agreements, which are typically used to keep vehicles. This mechanism, as opposed to discharging a creditor in a bankruptcy, is the concept of establishing a new payment plan termed a ‘re-affirmation agreement”.

What an Automatic Stay Doesn't Do

Automatic Stay U.S. Bankruptcy – Arizona

Irrespective of the petitioner’s choice of chapter of the bankruptcy code, when an individual files for bankruptcy, he or she triggers an automatic stay that immediately puts a stop on the actions by creditors against himself / herself (debtor) and his / her (debtor’s) property (see 11 U.S.C. § 362).  An automatic stay has the potential to protect the debtors against any and all attempts from the creditors to collect debts, at least for the time being. Chapter 13 of the bankruptcy code, goes one step ahead, and protects the debtors as well as the co-debtors. Conversely, secured creditors may explore their option of petitioning the bankruptcy court for respite from the automatic stay by showing an applicable clause.

Keeping Credit Cards Chapter 7

Often, chapter 7 bankruptcy clients have a strange preconception that they can keep certain credit cards, or credit cards with no ($0) balance.  For example, a few days a go a potential client came into the office to obtain an intake packet.  She mentioned to my paralegal that she planned on keeping a $300.00 credit card she had for “emergencies”, apparently it had a $0 balance.