The fact that you filed bankruptcy will, most likely, show up on your credit report. It can remain there for a maximum of 10 years. Although the filing of bankruptcy is a negative on your credit report, in many cases, it actually improves the credit report over what it was just prior to filing. Most people, by the time they come to OREGON FRESH START already have a credit report that shows defaults, delinquent payments, and "charge offs." Many lenders will give consideration to a new loan after you have filed bankruptcy because you owe very little, if any, debt and the lender knows that you cannot file again for several years. Many clients who come to OREGON FRESH START are embarrassed by their financial situation. To them, filing bankruptcy is the last thing they want to do. However, those clients are almost always feeling severe stress in the family. Once we explain to them that Congress has established bankruptcy laws to provide a fresh start for individuals and that they will feel that a huge burden has been lifted from their shoulders, they exhibit feelings of relief. You, too, will realize that OREGON FRESH START is not here to be judgmental but to provide assistance that will make your life better. Credit can be reestablished. It has been our experience at OREGON FRESH START that avoiding bankruptcy at the expense of your health is not worth it.

Immediately upon the filing of a bankruptcy petition with the court, an "automatic stay" is created. This automatic stay provides that creditors cannot take any further legal action against you without special permission of the court. For example, if a creditor is garnishing your wages, the automatic stay created by filing a bankruptcy petition prevents further wage garnishments. Also, if a foreclosure sale on your house has been scheduled, the automatic stay will stop the foreclosure sale and give you more time to sell the home and recover your equity or provide for paying the past due payments through a Chapter 13 plan. It has not been uncommon for clients to come to OREGON FRESH START where a garnishment or foreclosure is scheduled within 3-4 days. In those circumstances, same-day or next-day filing can be accomplished, thus creating the automatic stay and avoiding further financial loss.

By law, creditors are allowed to call you within reason to discuss your failure to abide by the contract terms of your credit. However, as is all too well known, creditors, especially collection agencies, can be annoying, rude, and frequently go beyond the bounds of the collection laws to the point of harassment. If a creditor has violated the law, you certainly are entitled to sue them. However, that costs money. Frequently, the creditor is in another state which might require you to file the lawsuit in that state. If you find that your financial situation is leading you towards bankruptcy, the easiest thing to do is contact OREGON FRESH START for a consultation about the situation. If it is determined that filing is the best thing for you to do, once you have paid the fees required, you can refer all creditor calls to OREGON FRESH START. This will stop most calls. Once your petition is actually filed, the automatic stay (discussed in more detail here) will prohibit your creditors from having any contact with you. There are severe penalties for creditors who knowingly violate the automatic stay. Keep track of any telephone calls, letters, or other communications you receive from creditors after you file your petition. Give this information to OREGON FRESH START.

Filing a bankruptcy petition discharges the debt only as to the person filing. Creditors sometimes require cosigners to add some additional safeguards and to protect them from bankruptcy filings. If your debt is discharged, the creditor will most likely go after the co-signer. The only way to protect against that situation is to continue to pay the debt after the bankruptcy is finished or to file a Chapter 13 bankruptcy and pay the debt through the bankruptcy.

No. There are some debts that cannot be discharged under any circumstances such as child support, alimony, any debt owed as a result of drunk driving, and criminal restitution. You cannot discharge a debt where fraud was present or where there was a willful or malicious injury. An example of fraud would be where you gave false information on a credit application and the creditor granted you a loan based upon the false information. Another example would be where you made a large purchase or obtained a large cash advance on a credit card knowing that you were having financial problems and would have difficulty repaying the debt. Generally, you cannot discharge old taxes unless it has been more than three years since you filed your tax return for that year. Student loans present particular problems because the government has tightened the rules considerably over the past several years. To discharge a student loan requires that you sue the government and prove, among other things, that if you were required to repay the loan, it would create an "undue hardship" for you. Lawsuits against the government are very expensive so you should probably approach filing bankruptcy knowing that you will end up having to repay the student loan. The government now has programs that will allow you to repay the loan over as many as 30 years. The result is low payments over a long period of time. In a Chapter 13 filing, you can discharge tax debts at the end of the 3-5 year period even if you did not file a tax return The rules regarding the elimination of debts in bankruptcy are complicated. You should consult with an expert in bankruptcy before filing.

Secured creditors (those creditors who have collateral for their loans, such as a car or boat) will want you to reaffirm the loan. When you reaffirm the loan, you re-obligate yourself to all of the loan terms just as if you were getting a new loan from the creditor. Although this may sound harmless, it has serious consequences. If you reaffirm and then later default on the loan, you are personally liable to pay the balance and you will have no protection on that debt from the bankruptcy. One of the major changes made to bankruptcy law in 2005 is that a creditor can repossess the collateral if you do not reaffirm. This change does not apply to real estate debt. Your reaffirmation agreement is subject to court approval in some circumstances. If your income is less than your monthly expenses, you may be required to participate in a telephone hearing with the court where you will be required to explain to a bankruptcy judge why the reaffirmation is in your best interest and how you intend to make the payment. More often than not, when you file bankruptcy, you owe more on the collateral securing the loan than it is worth. If your loan is more than 2 1/2 years old, under a process called REDEMPTION, bankruptcy law allows you to reduce the amount owing on the debt to the value of the collateral if you can pay it all at once. Many debtors can find a source of family financing or, perhaps, borrow from a 401K account, etc. and come up with the full value. There is also a company on the internet that specializes in redemption funding for cars. Talk with OREGON FRESH START about this for more information. WOULDN'T IT BE BETTER TO SETTLE MY DEBTS THROUGH A DEBT CONSOLIDATION PLAN? Although there may be a few reputable credit counseling services out there, most will not and cannot give you what they promise. Usually, they promise they can settle your debts for 50 cents on the dollar and that when you get done, you will have great credit. The facts are that (1) most people do not complete the "plans" because they usually do not work, and if you do complete the plan, (2) your credit is trashed. Creditors report to credit bureaus exactly what happened. If you get hooked on a 50% plan, your credit report will show that you did not pay all of the debt and that the unpaid balance was charged off. Most creditors do not waive interest or late fees. In addition, most credit counseling programs will charge you a fee (a portion of each payment) and they often do not send your money to the creditors for several months. This gives them an interest-free loan working with your money. Most debtors would be better off filing a Chapter 7 or Chapter 13 bankruptcy which can force the creditors to accept your terms of repayment. In addition, and this is a big one, the amount that was charged off by the creditor will likely be reported to the IRS with a 1099 tax form and you will be required to pay income taxes on the charged-off amount which will be a very unpleasant surprise for you when you file your tax returns for that year. CAN STUDENT LOANS BE DISCHARGED? Yes, but it is not easy. It will also, probably, be expensive. Once upon a time, federally guaranteed student loans were dischargeable if the loan was more than 7 years old. In 1998, the federal government changed all that. Now, federally guaranteed student loans cannot be discharged unless you can prove that being required to repay the loan will cause an undue hardship - not just a hardship, but an "undue" hardship. To have an opportunity to prove your case, you will be required to sue the federal government in bankruptcy court through an adversary proceeding. You will be required to prove all of the following: repayment of the loan would prevent you from maintaining a minimal standard of living your financial circumstances are not likely to change in the foreseeable future you made a good faith effort to repay the loan before you became unable to pay Frequently, the federal government will try to show that you could get a reduced payment plan by going through a consolidation program that will stretch out your payments for 20 years or more based upon an "ability to pay." In short, it is possible to discharge a student loan, but the government has made it very difficult. Also, remember that the government has a raft of lawyers to defend the federal government in the lawsuit who are paid for by your taxes. On the other hand, you will be required to pay for your attorney.