Bankruptcy Law

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Eliminate your debt by choosing  Edward B. Claxton III, Attorney At Law. As a locally owned law firm, we have 37 years of experience. Our bankruptcy lawyer offer assistance with both Chapter 7 and Chapter 13 bankruptcy.

You can count on our experienced attorney to find a debt relief solution that works to your benefit. Contact us to schedule an appointment today!

Print the following forms that you will need to bring for your bankruptcy appointment:

BANKRUPTCY INFORMATION

Bankruptcy law is a federal law. This document provides you with some general information about what happens in a bankruptcy case. The information contained within this document does not represent a complete collection of bankruptcy rules, law, policies, procedures, regulations and requirements. You may need to seek legal advice in addition to the information provided within this document.

WHEN FILING BANKRUPTCY:

Debtors may choose the type of bankruptcy that best meets their individual needs. A debtor is required to include all debts in the filing of a bankruptcy petition.

Chapter 7 Bankruptcy:

  • A trustee is appointed to take over the debtor’s property.
  • Any property of value will be sold or liquidated to pay the debts held by creditors.
  • The debtor may be able to keep certain personal items and certain real estate depending on the laws of the debtor’s state of residence.
    • Georgia law does allow for retention of certain items in a Chapter 7 bankruptcy under specific circumstances.

Chapter 13 Bankruptcy:

  •  A trustee is appointed to collect payments from the debtor.
  •  The trustee will make payments to the debtor’s creditors.
  •  The trustee will also ensure that the debtor is completing the terms of the bankruptcy repayment plan as confirmed.
  • A Chapter 13 Bankruptcy allows the debtor to retain their property.
  • The debtor must have a regular source of income.
  • The debtor must agree to pay a specific portion of their income to creditors as approved by the Court.
  • The Court must approve the debtor’s budget.

Chapter 12 Bankruptcy:

A Chapter 12 Bankruptcy is intended to assist the debt reorganization of family farms.
  •  A trustee is appointed to collect payments from the farmer/debtor.
  •  The trustee will make payments to the farmer’s/debtor’s creditors.
  •  The trustee will also ensure that the farmer/debtor is completing the terms of the bankruptcy repayment plan as confirmed.
  • A Chapter 13 Bankruptcy allows the farmer/debtor to retain their property.
  • The farmer/debtor must have a regular source of income.
  • The farmer/debtor must agree to pay a specific portion of their income to creditors as approved by the Court.
  • The Court must approve the farmer’s/debtor’s budget.

Chapter 11 Bankruptcy:

A Chapter 11 Bankruptcy is intended to assist in the debt reorganization of businesses.
  • The debtor may continue to operate their business.
  • The debtor’s creditors and the Court must approve a plan to repay the business’ debts.
Bankruptcy law does allow for conversion from one type of bankruptcy chapter to another type of bankruptcy chapter if necessary.

The filing of a bankruptcy may be reported to the credit bureaus. A bankruptcy filing may appear on a credit report for as long as 10 years. A bankruptcy can impact a debtor’s ability to obtain credit in the future.

BANKRUPTCY DISCHARGE:

The eventual goal of filing a bankruptcy is the receipt of a discharge. A bankruptcy discharge is a Court order stating that a debtor has completed the Court’s required payment of their  financial obligations as established in their bankruptcy petition, schedules and plan.
Details on discharges:
  • If a judge finds that the debtor received money or property fraudulently, the debtor may not receive a discharge.
  • If a judge finds that a debtor hides or destroys property included in the bankruptcy, falsifies records included in the bankruptcy, is untruthful with regards to the bankruptcy or does not obey an order of the bankruptcy court, the debtor may not receive a discharge.
  • Any debt excluded from a bankruptcy schedule will not be discharged upon completion of the bankruptcy plan.
  • A debtor may voluntarily pay a debt that has been discharged, but the creditor may not require payment on a discharged debt. This action does not require a reaffirmation agreement. This action does require inclusion of the debt in the bankruptcy petition.
  • A debtor may only request one discharge under Chapter 7 Bankruptcy every 6 years.
Some debts are not eligible for a discharge through bankruptcy. These debts include but are not limited to:
  • Income taxes,
  • Property taxes,
  • Child support obligations,
  • Alimony obligations,
  • Most student loans,
  • Court fines and criminal restitutions,
  • Personal injury losses due caused by drunk driving or driving under the influence of drugs.

REAFFIRMATION AGREEMENT:

If a Chapter 7 bankruptcy debtor wishes to keep property for which they still have a financial obligation, the signing and filing of a reaffirmation agreement allows the debtor to keep their property. A reaffirmation agreement is a promise to pay the debt. Debtors may request a reaffirmation agreement from the creditor for property they wish to retain. The creditor for the property must agree to the terms of the reaffirmation agreement. Common examples of property retained by entering into a reaffirmation agreement include homes, vehicles and boats. There are requirements for a reaffirmation agreement.

Those requirements are as follows:
  • The reaffirmation agreement must be entered into voluntary by all parties involved in the debt;
  • The reaffirmation agreement must not place too heavy a burden on the debtor’s finances;
  • The reaffirmation agreement must be in the best interest of the debtor.
A reaffirmation agreement can be cancelled any time before the Court issues the debtor’s discharge or within 60 days after the agreement is filed with the Court, whichever instance allows the debtor the most time.

Debtors not represented by an attorney may enter into a reaffirmation agreement. The Court will hold a hearing to determine approval or denial of the reaffirmation agreement. The reaffirmation agreement is not legally binding until it is approved by the Court.

If a reaffirmed debt is not paid as promised, the debt is owed as though the bankruptcy had not been filed. The debt will not be discharged. The creditor may pursue their state law remedies to recover the property or any property on which the creditor holds a lien or mortgage. Additionally, the creditor may pursue a judgement against the debtor to recover deficiencies.

THE BANKRUPTCY TRUSTEE MAY NOT PROVIDE LEGAL ADVICE. ONLY AN ATTORNEY MAY PROVIDE LEGAL ADVICE.
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