What If I Move During My Bankruptcy?

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Your mailing address is very important while you are in an active bankruptcy.  Your attorney as well as the Trustee and/or Bankruptcy Court, send you important documents during your bankruptcy for a number of reasons, such as updating you on the status of your case or sending you your final decree which lets you know your case is closed.

Young Family in their New Home

In a Chapter 7 bankruptcy, from your filing date, you will receive your Final Decree within 4 to 6 months.  As long as you have a mailing address that will remain the same during that time period, there should not be an issue.  However, in a Chapter 13 bankruptcy, it will be 3 to 5 years before you receive your final decree.  Therefore, it may be more likely for you to switch residences.  You should notify your attorney of your updated address, so they may file a notice of address change with the bankruptcy court. This is important because it will ensure that you receive important and time sensitive information from the bankruptcy court.

Also, please be aware that if you are selling your home, you must request permission from the Bankruptcy Court to transfer that property while in an active bankruptcy, regardless of which chapter you file.

Can I Purchase a Vehicle in a Chapter 13 Bankruptcy?

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The short answer is yes.  However, there is a bit of a process behind purchasing a vehicle in a Chapter 13.  First, your budget needs to be reviewed.  This requires your bankruptcy attorney to review your income and your expenses to make sure you can afford to have an extra payment in your budget.  Once it has been established that you are able to make a new car payment, a request to purchase a car must be made to the Bankruptcy Court.  This is done through a process called a Motion to Incur Debt.

Researching Bankruptcy Questions

After your bankruptcy lawyer files the Motion to Incur Debt the bankruptcy judge will evaluate your situation to make sure that you can make the monthly payments without any problems. If there are problems, they will deny your ability to get financing for the vehicle. It is the judge’s job to make sure that you do not incur new debt and end up in the same situation that caused you to file bankruptcy in the first place.

What if you plan to buy a car without financing?  You will still need to obtain permission; additionally, you will need to explain where the lump sum of money came from.  It is always best to discuss this possibility with your attorney first to remove any possible issues that may arise from the access of extra money.

Do I Need to Include a Creditor on My Bankruptcy If There Is No Balance on the Account?

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If you have a credit card or a loan with a zero balance, it is a personal decision whether you include them on your bankruptcy.  If there no balance, it may not be necessary to include them on your bankruptcy filing; however, it may be in your best interest to include them should there be any fees or interest charges that were placed on your account during the most recent billing cycle.

Blue Credit Card

Regardless of whether you include the creditor on your bankruptcy, the creditor will most likely find out about your bankruptcy filing and terminate your privileges with them.  For example, if you have a line of credit with no balance, you will most likely be unable to take any future draws on the line of credit.  The same would apply with a credit card.  Although you did not include the credit card company on your bankruptcy, they will most likely terminate your card.  As a result, attempting to make charges on the credit card after filing bankruptcy could lead to an embarrassing event.

If you have a credit card you would like to retain and use after filing bankruptcy, you will need to contact the credit card company in advance of filing bankruptcy and determine if their policy would allow you to keep the card.  A few companies have been willing to allow you to continue to use the credit card after filing bankruptcy; however, that is the exception.  Do not wait until after your bankruptcy has been filed to contact the creditor, since they will most likely not be willing to speak with you.  In addition, if you fail to include them in your bankruptcy filing and determine there was a balance on the account, you may be charged fees to add them to your bankruptcy.  As a result, it is always the safest approach to include the creditor on your bankruptcy filing regardless of whether there is a current balance.

Am I Responsible for the Loan On My Car If I Voluntarily Turn it In?

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You will still be responsible for the loan or debt on your vehicle even if you voluntarily turn it in. If you have a vehicle that you cannot make payments on, you have the choice of voluntarily surrendering the car or you can let the creditor repossess it. What many people do not know is voluntarily surrendering the vehicle is still considered a reposession on your credit report, a voluntary reposession.

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Do I Have to Pay my Homeowner’s Association Dues after Filing Bankruptcy?

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Am I Required to Pay Property Taxes On My Vehicle if I Surrender it in Bankruptcy?

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Can A Person Incarcerated File Bankruptcy?

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Thumb Tack IconA person who is incarcerated can, in fact, file for bankruptcy. However, there are some extra steps that will have to be taken.

Since a person who is in prison obviously cannot leave, they must file a power of attorney so that a friend or family member can meet with the bankruptcy lawyer who is intending to file the bankruptcy.  This would have to be done as soon as the incarcerated person decides that a lawyer needs to become involved. This is because the lawyer will need power of attorney information from the very beginning of the meetings in order to discuss anything with the friend or family member.

One of the things that is required when filing bankruptcy is the debtor has to take the credit counseling course and financial management course. Since a person who is incarcerated most likely will not have regular access to the internet, a motion must be filed by the attorney to waive the requirement to take these courses.

There is also one other motion the attorney will most likely have to file. Since the incarcerated person will not be able to attend the 341 Creditor’s Meeting, a motion will have to be filed stating the reason that the debtor cannot attend.

All of this information is based on the debtor being in the Western District and Middle Districts of North Carolina. Most likely some of these steps will be the same in different districts, but be sure to check with your attorney because there very well could be different requirements.