Bankruptcy Overview

Lawyers Helping the People of San Antonio

At Fears | Nachawati, we are committed to helping people throughout the San Antonio area regain control of their finances. Our attorneys are always willing to help you file for bankruptcy -- but first we want to make sure you understand what bankruptcy can and can't do for you. See the following pages for plenty of information about bankruptcy:

• Should I Consider Bankruptcy? There are a number of questions you should ask yourself if you are considering bankruptcy.
• Chapter 7 or 13: Which is Right for Me? Your salary can be a big factor in determining which kind of consumer bankruptcy you undergo.
• What Is Chapter 7? Chapter 7 bankruptcy is a relatively brief process that involves selling off many of your assets and then wiping debts clean.
• What Is Chapter 13? Chapter 13 bankruptcy puts you on a payment plan that pays off some of your debt and then discharges the rest.
• Saving Your Home and Car : Filing for bankruptcy can stop a foreclosure or repossession under most circumstances.
• Protecting Your Personal Property : Most people who undergo bankruptcy do not lose much personal property, just give up a few items not deemed necessary for living.
• How Bankruptcy Affects Debts and Lawsuits : The point of filing for bankruptcy is to either get rid of debts or find reasonable ways to pay them off. And filing for bankruptcy puts a hold on all debt-related lawsuits.
• Rebuilding Your Credit : After and even during bankruptcy proceedings, you can begin rebuilding your credit rating.
• Life after Bankruptcy : Bankruptcy wipes the slate clean, and after it is over our lawyers can help you start a new, debt-free life.

We also recommend our Bankruptcy FAQ, which covers much of the above information and more. And at any time, if you have questions, please contact our attorneys. We maintain office hours 6 days a week and can meet with you in the evenings or on weekends. Flexible payment plans are available.

What Can You Keep When Filing for Bankruptcy?

This is a quick list of the things you can keep when filing for bankruptcy (Depending on the type of exemptions you qualify for and the amount of equity you have).

• Your house
• Your Car(s)
• Your Bank Account(s) – including Savings Accounts
• All Retirement Account(s) – Yes, 401ks, 403bs & IRAs.
• Your Personal Belongings
• Stocks, Bonds and Mutual Funds
• You’re Sanity!

Your Bankruptcy Discharge

The word bankruptcy is derived from two Latin words, bancus, meaning “bench,” and ruptus, meaning “broken.” The term was used to describe the breakup of a tradesman’s business (often resulting in physically breaking the tradesman’s table or bench, signifying the end of the business). Early bankruptcy laws were concerned with protecting creditors from insolvent businesses. Usually this meant total liquidation of the business. In some cases a creditor could have the tradesman imprisoned for non-payment of a debt.

Modern bankruptcy law in the United States is more forgiving and promises the individual creditor a fresh start. The United States Bankruptcy Code is enacted by Congress via authority granted by Article I, Section 8 of the United States Constitution. United States bankruptcy laws have evolved to protect the honest, but unfortunate debtor and provide a discharge of overwhelming debts. Debtor’s prisons were abolished in the United States.

The cornerstone of the bankruptcy fresh start is the bankruptcy discharge, a permanent court injunction that prohibits creditor collection against the debtor. The bankruptcy discharge is available to individual debtors and is generally ordered at the end of the bankruptcy case. A discharge is not available to a non-individual, like a businesses or corporation. The discharge order forbids creditors from contacting the debtor to collect on a debt, or taking legal action against the debtor personally. The bankruptcy discharge is very broad and is enforced through a contempt action with the bankruptcy court.

Certain debts are not affected by the bankruptcy discharge including child support obligations, debts obtained by fraud, criminal fines or restitution, most student loans, and certain taxes. While these debts are non-dischargeable for policy reasons, other common debts like medical bills and credit card debts are discharged by the bankruptcy. The Bankruptcy Code offers certain protections to the debtor to repay non-dischargeable debts during a bankruptcy case.

If you are struggling with debts and need a fresh start, discuss your options with an experienced bankruptcy attorney. The modern bankruptcy law offers many legal options for paying or discharging personal debt. Learn how a bankruptcy discharge can start you on a path to a fresh financial start.

Don't Let Zombie Debts Haunt You

If a debt collector is harassing you over a debt that you thought was dead and buried, you may be dealing with a zombie debt. The usual scenario is an unexpected phone call or letter asking for payment on a debt that is either outside the statute of limitations or is in some other way legally uncollectible (e.g. discharged in bankruptcy). The collector may even offer a “special deal” like a 75% discount for immediate payment. What the collector will not reveal is that the debt is legally uncollectible – meaning it is unenforceable in a court of law.

Zombie debt collection is big business. Zombie debt collectors buy old debts for pennies on the dollar, then try to collect as much as possible. If the zombie debt collector buys an old $1,000 credit card debt for $20, and one phone call settles the debt for $100, the zombie debt collector makes a nice profit. Since the debt is not legally enforceable, guilt and scare tactics are all the collector has to coerce payment.

Some zombie debt collectors actually violate the law by attempting to collect. For instance, trying to collect a debt that was discharged in bankruptcy is a serious violation of the federal court discharge injunction. Threatening a lawsuit for a debt that is past the statute of limitations is a violation of the federal Fair Debt Collections Practices Act (FDCPA). Zombie collectors not only rely on ignorance of the law, they thrive on it!

Some individuals want to pay these debts. While admirable in intention, the result may be extremely harmful. Unpaid debts that have dropped off a credit report may be reported for another seven years after the payment date. That dead and gone debt may reappear as an entirely new (and legal) negative item on your credit report – and substantially harm your credit score.

So what should you do if you encounter a zombie debt collector?

• Know your rights! Your attorney can explain the statute of limitations or other legal restriction to the collection of an old debt.
• Do not give any personal information to a zombie debt collector. Nothing good can result.
• Do not make a payment on an old debt until you learn your rights. What may seem like an honest act of payment on an old debt may turn into a nightmare on your credit report.

Remember, zombie debt collectors are the bottom feeders of the collection industry. They have been known to employ the worst ethical practices to obtain payment. Don’t be haunted by zombie debts. Contact bankruptcy firm Fears | Nachawati for a free consultation by calling 1.866.705.7584 or by e-mailing info@fnlawfirm.com and chase them back to the grave!

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We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.