Our Tacoma bankruptcy lawyers answer some frequently asked questions
Most of our new clients have a lot of questions about the bankruptcy process. Many of these questions are similar, so we created this list of frequently asked questions to help you better understand what to expect if you choose to file for bankruptcy.
How much does bankruptcy cost in Washington State?
This is a difficult question to answer without getting a more in depth look at your personal finances. You may encounter other Tacoma bankruptcy lawyers offering outrageously cheap prices, but this is just a way to get people to call their law office. We've been told that these prices only cover a “really simply bankruptcy petition,” and that the actual price they pay is much higher. Our attorneys charge low flat fees based on the amount of work it will take to complete each case. You will know the cost up front, and there won't be any hidden charges.
How long does bankruptcy stay on my credit report?
Will my credit score drop all the way to zero?
This is a very common question, but there is no way to know what your credit score will be. However, many people's scores increase after filing for bankruptcy.
Can I pay friends and family back?
Yes, but you should wait one year.
Can I get rid of a student loan that isn't federal?
No. All student loans are treated equally.
Can I maintain possession of my car and/or home?
Almost everyone that files for bankruptcy does. You must keep current on payments, and if you refinance your home mortgage you should go to a different bank. Be sure to obtain a payment history from your current lender.
How long does bankruptcy take?
Chapter 7 takes 3 to 4 months. Chapter 13 takes 3 to 5 years.
If I file Chapter 13, what will end up paying?
This is calculated on a case-by-case basis. We take your average yearly gross income and subtract what is allowed after administering a means test. This “magic number” is how much you're required to pay unsecured creditors. Then we figure how much you owe on secured debt, like car payments, the IRS, and your mortgage including arrears and penalties. Lastly, we add other secured debt you want to keep, trustee fees and leftover attorney's fees. If this number is less than your total debt divided by the length of your debt consolidation plan, then your plan is at 100%.
Will I be able to keep a credit card after I file for bankruptcy?
If you have a credit card without a balance, then you may be able to keep it. This is ultimately up to the financial institution that issued you the card.
I owe money to family and/or friends, but I don't want to list them. Is this okay?
You are required to list all debt, even loans from friends and family.
When can I start to rebuild my credit?
Once your remaining debt is discharged, your credit score will start to improve.