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TJ, Esq.
TJ, Esq., Attorney
Category: Bankruptcy Law
Satisfied Customers: 12250
Experience:  JD, MBA
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RE Bankruptcy Dont know where to start If I should file

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RE: Bankruptcy

Don't know where to start: If I should file and what will happen to my future credit, what to do, difference between Chapter 11 & Chapter 13.... Just totally depressed about this economy and situation. But need some answers.
Thank you and will await your response.
Hello and thank you for allowing me the opportunity to assist you.

Bankruptcy is obviously a last resort solution, and I certainly understand your depression, but the good news is that the effects don't last forever, and it can give you a fresh financial start. Your credit can be blemished for a maximum of 10 years per the Fair Credit Reporting Act. However, you should note that the major extent of the actual damage comes in the first few years. The bankruptcy will gradually be less and less important as the years go by, and by the 7th or 8th year it won't likely have much impact on your credit report.

The primary difference between a Chapter 13 and a Chapter 11 is that in the Ch11, the creditors get to decide whether to approve the plan. In a Chapter 13, the creditors do not get that vote (though they can still petition the court not to approve the plan). Generally speaking, Ch13s are filed by individuals, and Ch11s are filed by businesses (though that general rule is not written in stone). Most individuals certainly prefer Ch13s.

Have I satisfactorily addressed your concerns? If not, then feel free to let me know, as I will be happy to clarify my answer or help with your follow-up questions. In the meantime, please remember to click the green accept button so that I will receive credit and compensation for my time (doing so does not end our session). Positive feedback is always appreciated as well. Thank you and good luck!
Customer: replied 6 years ago.
Hello and thank you for your response, though....

With the Chapter 13: Do I need an attorney to do this? Do I have to sell my car, (only about $4,000 value)?
I do have some money in an IRA which was supposed to be my retirement- Will that first be used to pay off any debits? If so, even if debts are resolved with CH13, I will have nothing to live on.
I never thought this would happen to me. I am very scared.... 53 years old, worked all my life. Was with last employment 17 years, downsized & let go... 4 1/2 years ago. Have 3 degrees and am only told I have over-educated myself out of the work force.
Don't mean to cry on your shoulder... just lost about what to do.
Again- I thank you for your advice and will await your response.
Hi again.

In a Ch13, you can make arrangements in the plan to keep your car (the same goes for other assets). IRAs are exempted in Michigan bankruptcies, so that means you can keep the IRA without it being used to pay off creditors. I think that you will seriously want to talk to a local bankruptcy attorney. It sounds like it may help you (and it's probably not as bad as you're thinking).

I hope that helps. Please remember to click "accept."
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