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Automatic Stay is the legal terminology for the prohibition of any attempts by creditors to contact you or to collect a debt. In other words, they must stay away once your Petition is filed. They may not call you, sue you, garnish your wages, repo your car, foreclose on your house, take money out of your bank account, etc. The automatic stay is invoked immediately upon filing the Petition.

Creditors Meeting is scheduled approximately 30 days after filing the Bankruptcy Petition. All the listed creditors are invited, but they very rarely attend since they are limited to asking questions about the "nature and location" of your assets. Your attorney will accompany you at this meeting, which rarely exceeds 5-10 minutes.

Dischargeable Debts are all debts which the Bankruptcy Code has failed to identify as non-dischargeable.

Exempt Assets are assets (property) you own (real and/or personal) which are partially or entirely exempt from the reach of the Trustee, ie., they cannot be sold for the benefit of the creditors. If you own your home, the Homestead Exemption (whether filed for or not) protects up to $50,000 worth of your equity in that home ($75,000 for a couple filing jointly ... $150,000 for debtors over 65 or over 55 and disabled). Most of your reasonably necessary household goods and personal items are exempt, as well as up to $3,300  worth of equity in automobiles. Funds held for retirement in ERISA qualified plans are exempt, etc. (This is an area in which it is very important that you know what you're doing before you file your Petition, Schedules, and Statement of Financial Affairs.)

Joint (Debtors/Filings) occur when both husband and wife file together. If only one spouse files, then only that one will be discharged of the debts, and the creditors may pursue the other spouse for joint obligations. If you are married, it is probably wiser to file jointly unless you haven't been married very long and the debts are all yours, ie., your spouse never signed the applications for credit and his/her income was not used to obtain the credit.

Non-dischargeable debts are those which do not necessarily go away in bankruptcy and which you may still have to pay. They fall into the following categories (and Congress is working on adding more):

  • Child and spousal support
  • Income taxes due or assessed within the past 2-3 years
  • Student loans
  • Luxury purchases/Cash advances within 60 days of filing
  • Credit obtained by fraud
  • Court-ordered fines, penalties, restitution

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