Frequently Asked Questions
What disclosures must a collection agency provide to a debtor?
- The amount of the debt,
- The name of the original creditor,
- The period of time in which the debtor may dispute the validity of the debt (thirty days), and
- The obligation of the collection agency to send the debtor verification of the debt if its validity is disputed.
What actions must a collection agency avoid?
Are there any alternatives to filing bankruptcy?
Are student loans discharged in a bankruptcy proceeding?
What effect does a bankruptcy filing have on the collection of alimony and child support?
Does a bankruptcy discharge eliminate all debts?
- Debts or creditors not listed on the schedules filed at the outset of the case;
- Most student loans, unless repayment would cause the debtor and his or her dependents undue hardship;
- Recent federal, state, and local taxes;
- Child support and spousal maintenance (alimony);
- Government-imposed restitution, fines, or penalties;
- Court fees;
- Debts resulting from driving while intoxicated; and
- Debts not dischargeable in a previous bankruptcy because of the debtor’s fraud.
- Debts from fraud, including certain debts for luxury goods or services incurred within sixty days before filing and certain cash advances taken within sixty days after filing;
- Debts from willful and malicious acts;
- Debts from embezzlement, larceny, or breach of fiduciary duty; and
- Debts from a divorce settlement agreement or court decree, if the debtor has the ability to pay and the detriment to the recipient would be greater than the benefit to the debtor.
How much property does the debtor have to give up in a bankruptcy proceeding?
- Expensive musical instruments, unless the debtor is a professional musician;
- Collections of stamps, coins, and other valuable items;
- Family heirlooms;
- Cash, bank accounts, stocks, bonds, and other investments;
- A second car or truck; and
- A second or vacation home.
- Motor vehicles, up to a certain value;
- Reasonably necessary clothing;
- Reasonably necessary household goods and furnishings;
- Household appliances;
- Jewelry, up to a certain value;
- A portion of the equity in the debtor’s home;
- Tools of the debtor’s trade or profession, up to a certain value;
- A portion of unpaid but earned wages;
- Public benefits, including public assistance (welfare), Social Security, and unemployment compensation, accumulated in a bank account; and
- Damages awarded for personal injury.