Life After Bankruptcy
You have a fresh start, and some new challenges. Your credit rating, which probably wasn't all that great already, will be impacted by filing for bankruptcy. Filing for bankruptcy will have a short term negative impact on your credit rating, but not filing for bankruptcy may be worse. Not filing for bankruptcy and continuing to incur late fees, legal charges and judgements will continue to bring down your credit until you do something about it.

You really need to ask yourself several key questions including, 'how did I get here? What could I have done differently and what should I do differently in the future? And what have I learned from all of this? Your answers will help you create a better financial afterlife in the wake of a bankruptcy.

Many of my clients tell me that they were able to obtain a new car loan immediately after filing a chapter 7 bankruptcy, even while it is still on their credit report. FHA guidelines also allow you to get a mortgage two (2) years after filing a ch. 7 bankruptcy. You will also get solicited for new credit cards almost immediately because you can only file for a chapter 7 once every eight (8) years. The creditors know you have to pay back your debt to them so they will make credit easy to obtain, although at slightly higher interest rates. Generally, you do not want to incur more credit card debt, however you may want to get one credit card for emergencies or for contingencies such as booking plane tickets or car rentals. Remember, the whole point of filing for bankruptcy in the first place was to rid yourself of debt and get a fresh start, not to get into debt all over again.

After your bankruptcy has been discharged, you need to re-establish your good credit. You need to do so right away for a chapter 7 or after reorganization for a Chapter 13. Obviously, continuing to pay your other bills on time such as your mortgage and utilities will help to build up your credit. You may also want to get either a secured or unsecured credit card and pay it off every month. There are reputable companies available who will help you to build your credit back up. This can be explained more during your free initial consultation.

You are only able to receive a discharge in a chapter 7 bankruptcy after eight (8) years have passed since the commencement of the last case in which you received a discharge. You generally can file another chapter 13 case sooner (usually 4 years) if the need arises. Thus, you should not file a bankruptcy if you need the option of doing it again in the next few years. The case may arise if the reason you are filing bankruptcy is to discharge medical bills and you may have to incur additional medical bills in the future.

How Much Does It Cost To File Bankruptcy?
 What is the cost for filing Bankruptcy with a lawyer? We can give you a price range for Chapter 7. The cost for filing Bankruptcy cases in will typically run somewhere between $1000 and $2000 for the lawyer fee for Chapter 7. (Chapter 13 fees depend on so many factors that there is no point trying to figure out the fee without seeing you in person for a consultation.) The court filing fee will be another $335, and court credit counseling should run about $15. But the exact cost for filing bankruptcy depends entirely on the facts your case. There is only one good way for you to find out. You need to see a bankruptcy lawyer for a personal consultation. Unless you do that, you are just fishing around and wasting your time.

The amount of court filing fees might be confusing. Many people thing a filing fee is an extra fee that goes to your lawyer. It isn’t. Filing fees are money collected by the court. The money for filing fees is used to pay the operating costs of the court. The filing fee for Chapter 7 bankruptcy is $335. The filing fee for Chapter 13 bankruptcy is $310. Normally, these fees are paid at the time you file your papers.

Why don’t lawyers charge everyone the same bankruptcy fee? We could do that. But it will be a bad deal for you. Most people would wind up paying more than they have to. Here’s why. The price for everything in life always depends on how much it costs to make it. The time and effort to do your neighbor’s bankruptcy case might be a lot more than it takes to do yours. That’s why your neighbor’s case will cost more. Your case is more simple. Should you pay as much as we charged your neighbor? Those differences directly affect the cost to file bankruptcy.

But some lawyers advertise a flat fee for everybody, don’t they? Yep. We see those ads just like you do. And we don’t believe them. We represent many clients who came over to us after they already went to those places. “Bait and switch” advertising has been around for a long time. (Think mortgage brokers, car dealers, jewelry stores, appliances stores, mattress stores, etc.) That’s because a new sucker is born every minute. And, bait and switch ads work on suckers. Going to a lawyer who plays “switcheroo” games on your fee is just asking for trouble later on.

We offer a completely free bankruptcy consultation.How much does it cost to file bankruptcy? Come see us and find out. You will meet with a bankruptcy expert having years of experience. You will get all your questions answered. We will explain how everything works. We will tell you if we see any troublesome problems. We will not recommend bankruptcy unless you need it. We will offer you a flat fee for any work we recommend, and we will put our fee in writing. Our fees are reasonable. Also, we consider ability to pay. We will reduce our fees for anyone with an extreme hardship.

An adequate bankruptcy evaluation will normally take anywhere from 30 to 60 minutes of office time.Without spending the time, a lawyer might not have enough information to tell you how much it will cost to file bankruptcy. Here are examples of some things a bankruptcy lawyer should know before quoting you the fee.

    Which kind of bankruptcy are you going to file:
  1.     Have you been in business
  2.     Who are your creditors
  3.     What are your assets
  4.     What is your income
  5.     What are your basic living expenses
  6.     Is there an emergency, like a foreclosure sale or wage garnishment?
    You may have documents which the lawyer needs to review, such as lawsuit papers, deeds, and foreclosure notices

“How do I pay you?”Once you know the cost to file bankruptcy, paying it is the #1 problem most clients have. I wish I had a dollar for every time someone asked, “How do I pay you?” Some people who need bankruptcy will never be able to pay a lawyer. However, most people will be able to afford a lawyer if they come to us. Without an experienced lawyer , you are running some big risks. Some of the problems we see in such cases are very serious where people file without a lawyer:

  1.     lost assets that might have been protected;
  2.     failed to discharge taxes that might have been dischargeable;
  3.     had their bankruptcy denied;
  4.     filed under the wrong chapter;
  5.     lost their home because the lawyer gave the wrong instructions.

What can be done to make it easier to pay the cost for filing Bankruptcy?

There are ways that make it easier to pay the cost to file bankruptcy. There are things that lawyers can do. And there are also some things that clients can do.

At my law firm, we struggle to stay affordable. There are several ways we do this. For one thing, we don’t waste client money paying for fancy offices. We don’t have oriental rugs on the floor. We don’t have fancy furniture. We keep our offices simple and functional. The biggest cost advantage that our clients benefit from is our experience . We can do most things in a fraction of the time it takes a less experienced lawyer. The cost savings is passed on to you.

Bankruptcy vs. Debt Consolidation

If you are struggling with debt and looking for a way out, it is wise to explore your options. You have probably seen or heard advertisements for debt consolidation services that promise to work with your creditors to consolidate your debt and significantly lower your monthly payments. We urge you to use caution before contacting one of these services. Like most promises that sound too good to be true, they often are. At The Brooke Law Firm we will help you explore all of the debt relief options available to you. We are a bankruptcy firm, but we do not push our clients into bankruptcy if we do not think it is the best option for them. We are committed to helping our clients resolve their debt problems, achieving true debt relief and avoiding potential debt consolidation scams.Call (631) 397-0042or contact us online for a free consultation with a Long Island bankruptcy lawyer. It could be your first step on the road to debt relief.

Is Debt Consolidation Right for You?

If you hire a debt consolidation service, the best case scenario is that they will act in good faith and attempt to work with your creditors to consolidate your debt and negotiate lower payments. The question is: How are they going to get your creditors to go along with the plan?

In many cases, debt consolidation services have no leverage and no means of providing lenders with incentive to agree to a debt consolidation. If, after months of waiting, the company is not able to help you, you will be left with all of the debt plus months of interest and/or late fees. Plus, you probably paid good money to the debt consolidation service. More often than not, the fees are more excessive for less relief than a discharge in a bankruptcy.

The above scenario is based on the assumption the consolidation service is acting in good faith. Since these companies are largely unregulated, consumers are putting themselves at risk by handing money over to them. A bankruptcy law firm is backed by the power of the federal bankruptcy code. When you file for bankruptcy, you do not have to get your creditors to agree to the plan. It is enforced by the bankruptcy court.

Bankruptcy is not right for everyone, but those who it can help are usually at a disservice by hiring a debt consolidation service.

What the Credit Industry Doesn't Want You to Know
The credit industry wants to discourage debtors from filing for bankruptcy protection. In an effort to collect on debts, creditors can be aggressive and frequently try to frighten hardworking people. At The Brooke Law Firm, we want to make sure those in financial distress understand the truth about filing bankruptcy.

From our office in Brightwaters (next to Bay Shore in Suffolk County), our firm has helped thousands of clients get the debt relief they need through Chapter 7 and Chapter 13 bankruptcy. During a free initial consultation, will meet with you and answer all your questions about bankruptcy and how it can affect your life. Do not let the credit industry scare you. Get the facts.

Did You Know?

Here is some information you may not know about bankruptcy :

  •     Recent bankruptcy laws are not as restrictive as you might think— While it is true that these laws created more steps and paperwork for bankruptcy filings, these changes will most likely affect your bankruptcy attorney more than they affect you.
  •     A majority of individuals who file for bankruptcy do not lose any of their belongings— Creditors would like you to believe that if you file bankruptcy, you will lose your house, your car and all your personal belongings. The truth is that a majority of petitioners retain all their property.
  •     After you file bankruptcy, creditor harassment must stop— Once you file, an automatic stay goes into effect, prohibiting creditors from contacting you.
  •     You have the power to stop a home foreclosure— Filing bankruptcy halts all foreclosure actions, giving you room to breathe.
  •     You can rebuild your credit— Once your debt is discharged, you will be able to work on repairing your credit score. Many people get approved for a secured credit card or loan within a year after filing bankruptcy. You may even have the ability to avoid high interest rates.
  •     Many people filing bankruptcy are good people who have fallen on hard times— The credit industry would like you to believe that only deadbeats file bankruptcy. However, a large number of petitioners got into financial trouble because of job loss, divorce or unforeseen medical expenses.
  •     Bankruptcy offers the best solution to obtain a fresh start after suffering from a financial hardship— Bankruptcy is usually a one-time, one-fee proposition. Your fresh start begins immediately after filing.

Reaffirming Debts
If you are behind on car or mortgage payments, which are classified as secured debt, and you want to keep the property after filing a Chapter 7 bankruptcy, you may be thinking about a reaffirmation agreement. By reaffirming the debt you owe, you are able to keep your vehicle or personal property recently purchased, provided you are able to make the payments.

However, reaffirmation agreements can be complex. To get all the information you need to make a sound decision, speak to us at The Brooke Law Firm. Our firm has helped thousands of individuals throughout Long Island achieve debt solutions that work for them. Meet with us to discuss your situation during a free consultation.

How Does a Reaffirmation Agreement Work?

Since home mortgages and car loans are considered secured debt, if you have defaulted on your payments, the lender can take the property from you. With a vehicle, it is referred to as repossession . With a home, it is a foreclosure action.

By reaffirming the debt, you are essentially promising the lender that the debt will not be discharged in bankruptcy. It involves entering into a new contract with the creditor for the remaining amount due. There are certain benefits to reaffirming a debt such as being reported on your credit report as being paid which will help you rebuild your credit.

Should I Sign a Reaffirmation Agreement?

If you wish to keep your vehicle you may need to sign a reaffirmation agreement. However, it is important that you understand that entering into that contract will make you personally liable for that debt, despite your bankruptcy relief. Therefore, it is critical that you can afford the payments established in the new creditor payment plan. The payments and interest rate stay the same, and are sometimes even lowered, and you are guaranteed the lender won't take the property as long as you are current with payments.

When the Financial Stakes Are High, Get Professional Advice

Reaffirmation agreements only apply if you file a Chapter 7 bankruptcy, not a Chapter 13 bankruptcy. To determine if you are eligible for Chapter 7 bankruptcy, you must pass the means test. We will meet with you in a free consultation to answer all your bankruptcy questions.

Bankruptcy and Student Loans
After working hard to improve your education, it can be frustrating to deal with massive student loan debt. Recent graduates often struggle to make ends meet, let alone pay down their loans. If your student loan debt is causing unmanageable financial hardship, it is time to talk with a bankruptcy attorney.

Generally, student loans are not dischargeable in bankruptcy. However, by filing either Chapter 7 or Chapter 13 bankruptcy, you can free up funds, making it easier to pay your student loans. At The Brooke Law Firm, we know the bankruptcy laws from the inside out and will explore every option available to get the relief you need.

Helping You Obtain an Increased Cash Flow

While you will most likely not be able to eliminate your student loan debt, there are ways to get the debt under control. By filing Chapter 7 bankruptcy, we can help you discharge your unsecured debts, such as credit card bills and medical expenses . Because you will no longer need to pay those debts, money is freed up to focus on your student loan.

By filing Chapter 13 bankruptcy, it is possible to reduce the amount of your monthly payment to something more workable without the threat of penalty. Your student loan could also be deferred for a period of time. To learn more about your options, call our office in Brightwaters (next to Bay Shore in Suffolk County) at (631) 397-0042 to arrange a free initial consultation.

12 Myths of Filing for Bankruptcy

Here is a link to an interesting article on the MSN Money website that I thought my clients would be interested in reading. They are myths to filing bankruptcy and are common mistakes in the perceptions of the general public.


Here is the text of the actual article so that you can read it here:

Like most big, bad scary things, bankruptcy has a reputation based on a few tidbits of truth and a lot of embellishment. And like most creepy crawlies, it's not nearly as frightening once you know the truth.

With a mind toward declawing the monster, here are a dozen misconceptions about bankruptcy:

1. Everyone will know I've filed for bankruptcy.Unless you're a prominent person or a major corporation and the filing is picked up by the media, the chances are very good that the only people who will know about a filing are your creditors. While it's true that bankruptcy is a public legal proceeding, the number of people filing is so massive that very few publications have the space, manpower or inclination to run all of them, although some local newspapers do print the names of those who have filed in that community.

2. All debts are wiped out in Chapter 7 bankruptcy .You wish. Certain types of debts cannot be discharged, or erased. They include child support and alimony, student loans, restitution for a criminal act and debts incurred as the result of fraud.

3. I'll lose everything I have.This is the misconception that keeps people who really should file for bankruptcy from doing it, says Chris Viale, the chief operating officer of Cambridge Credit Counseling in Massachusetts.

"They think the government will sell everything they have and they'll have to start over in a cardboard box," Viale says.

While bankruptcy laws vary from state to state, every state has exemptions that protect certain kinds of assets, such as your house, your car (up to a certain value), money in qualified retirement plans, household goods and clothing.

"For most people, they'll pass through a bankruptcy case and keep everything they have," says John Hargrave, a bankruptcy trustee in New Jersey. If you have a mortgage or a car loan, you can keep the property as long as you keep making payments (like the rest of us).

4. I'll never get credit again.Quite the contrary. It won't be long before you're getting credit card offers again. They'll just be from subprime lenders that will charge very high interest rates. "There are innumerable companies that will provide credit to you," says California bankruptcy attorney and trustee Howard Ehrenberg.

"I don't advise any of my clients to run out and run up the bills again, but if someone does need an automobile, they can go and will be able to get credit," he says. "You don't have to go underground or something to get money." (Do you know your credit rating? Take MSN Money's quiz for an estimate.)

5. If you're married, both spouses have to file for bankruptcy.Not necessarily. "It's not uncommon for one spouse to have a significant amount of debt in their name only," Hargrave says. However, if spouses have debts they want to discharge that they're both liable for, they should file together. Otherwise, the creditor will simply demand payment for the entire amount from the spouse who didn't file.

6. It's really hard to file for bankruptcy.It's really not. Technically, you don't even need an attorney -- you can do the paperwork without one. However, going through the procedure alone is not recommended.

7. Only deadbeats file for bankruptcy.Most people file for bankruptcy after a life-changing experience, such as a divorce, the loss of a job or a serious illness. They've struggled to pay their bills for months and just keep falling further behind.

8. I don't want to include certain creditors in my filing because it's important to me to pay them back someday, and if the debt is discharged, I can't ever repay them. Bless you for even thinking about such a thing. You're no longer obligated to repay them, but you always have the opportunity. If your conscience won't let you sleep because you didn't pay your debts, there's nothing in the bankruptcy code that prevents you from doing that once you're back on your feet. But it is nearly impossible to leave any account with a balance out of your list of creditors. In general, all creditors receive notification of your bankruptcy filing, whether they are listed in the petition or not.

9. Filing for bankruptcy will improve my credit rating because all those debts will be gone.Filing for bankruptcy is the worst "negative" you can have on your credit report. Unlike other negatives, which stay on your report for seven years, bankruptcy can be there for 10 years, but you do get to rebuild your credit eventually.

10. You can't get rid of back taxes through bankruptcy.Generally speaking, this is true. However, there is such a thing as tax bankruptcy, says tax educator Eva Rosenberg, known on the Web as TaxMama .

11. You can only file for bankruptcy once.The truth is, you can file for Chapter 7 bankruptcy only once every eight years, says Justin Harelik, Bankrate's bankruptcy adviser. For Chapter 13 reorganization, you can file more often than that.

Of course, that doesn't make it a good idea.

"Multiple bankruptcies are really bad," Rosenberg says. "Many people get into the habit of once they've done it, it becomes a way of life. This is not good for your karma." Or your credit rating.

12. I can max out all my credit cards, file for bankruptcy and never pay for the things I bought.That's called fraud, and bankruptcy judges can get really cranky about it.

Questions About Bankruptcy
1.) What is the difference between a chapter 7 and chapter 13 bankruptcy?

A chapter 7 is a "liquidation" bankruptcy that discharges your debts and you do not pay any of them back. Not all debts are dischargeable though such as some tax debts, criminal fines and most student loans. A chapter 13, on the other hand, is a wage earner's bankruptcy where you pay back anywhere from a fraction of what you owe up to the full amount. Debtors may file a chapter 13, as opposed to a chapter 7, for various reasons such as not passing the means test or they are trying to save their home and repay mortgage arrears.

2.) How long does a chapter 7 bankruptcy take before I receive a discharge?

Generally, once a ch. 7 is filed you will have one court appearance where you meet with the bankruptcy trustee assigned to your case. This is called the 341 Meeting of Creditors. Although it is referred to as the Meeting of Creditors, in most ch. 7 bankruptcy cases the creditors will not appear. The court appearance is usually only a few minutes long and in the vast majority of cases your 341 meeting will be closed by the trustee. Sixty (60) days after this your bankruptcy case should be closed and you will then receive a discharge of your debts. The discharge means you no longer owe the debts listed in your bankruptcy.

3.) Do I have to stand before a judge in a courtroom?

Nope, you will meet with the trustee assigned to your case at the court appearance where he will ask you questions for a few minutes. You will be prepared for the types of questions beforehand and you will feel comfortable by the time your court date arrives.

4.) I thought chapter 7 bankruptcy stopped the foreclosure? Can the bank still take my house?

When you file Bankruptcy, you receive an "automatic stay" on court actions such as foreclosures and sheriff's sales. A creditor can still go into court and ask the bankruptcy judge for a "relief from stay", and if granted the creditor can proceed with a court action to foreclose.

5.) Can I keep some of my debts out of my bankruptcy?

Nope, you must list all of your debts as well as assets in your bankruptcy petition. Debtors are not allowed to pick and choose whom they want to pay back. You may still voluntarily pay back a creditor, such as a family member, car loan or mortgage once your bankruptcy is discharged although you are under no legal obligation to do so.

6.) Can I change my Chapter 7 to a Chapter 13 and vice versa?

Yes, in most cases you are permitted using a "motion to convert." In certain instances you may want to do so if you can no longer afford your chapter 13 plan payments. You may want to convert to a chapter 7 to discharge the debt. A trustee may also make the motion to convert if he feels you have money to pay back some of your debts in a chapter 13. This may happen in rare instances such as if a debtor fails to disclose all of his or her income in the bankruptcy.

7.) Do my spouse and I have to file jointly?

Nope, the decision to file individually or jointly depends on your situation. For instance . . .

    If only one spouse owes all or most of the debt then only that spouse should file.
    If both spouses owe the debt and want to file a chapter 7 then both can file.
    If you're trying to stop a foreclosure then only one spouse who is on the title to the home needs file a Chapter 13.

8.) Are my family, friends and co-workers going to find out that I filed for bankruptcy?

It is a matter of public record that you filed for bankruptcy but in most cases only your creditors are notified that you filed. No one else will know unless you tell them or they do a search in the public court records.

9.) What does it mean to reaffirm a debt such as a car loan?

This means you would become personally liable for the debt again. Sometimes you may reaffirm a debt such as a car loan. The bank may require it or they can repossess your car, even if you are current with the payments. Bankruptcy may be considered a default under your loan terms and some financing companies may repossess the vehicle. I will explain during your free initial consultation whether or not I think it is a good idea to reaffirm depending on your particular case.
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