Frequently Asked Questions

Maybe not. The means test is the calculation that decides who can file Chapter 7. It starts by comparing your household income to the Illinois median for your household size. If you are above that figure, a second calculation subtracts allowances and deductions set by the Bankruptcy Code, including secured payments and certain standardized living expenses.

People above the median qualify regularly, and you might too. Do not rule yourself out on a salary figure alone.

For Chapter 7, no. There is no income requirement at all. Chapter 13 requires steady income to fund the payment plan, but it does not have to be a paycheck. Pension income, Social Security, or rental income can serve.

No. In some ways the need is more urgent. Once a judgment is entered, the creditor can garnish wages, freeze bank accounts, and place liens. Filing stops those collection efforts through the automatic stay. The automatic stay is the federal rule that stops most collection activity the moment your case is filed.

What was collected before you file is generally gone, so timing matters. A judgment recorded as a lien against your home is a separate problem with a separate fix in the case. Raise it with us early.

Often, yes. Waiting periods apply between discharges, and a case dismissed within the past year can change what a new filing protects. Tell us about any earlier case in the first conversation, and we will tell you exactly where you stand.

Yes. You can file individually or jointly, and we evaluate both in every married client’s case. Filing alone does not protect a spouse who co-signed a debt, though Chapter 13 may protect your co-debtors through the co-debtor stay. We can explain it at the consultation.

Yes, most likely. Most people who file keep what they own, and you probably will too. Illinois exemption law protects categories including household goods, vehicles, tools of your trade, and qualified retirement accounts. Each category has its own limit.

In the large majority of consumer Chapter 7 cases the filer keeps everything. Whether that holds for you depends on what you own and what it is worth. That is one of the first things your free consultation settles.

Usually, yes. If you are current on the loan and your equity fits within the exemption, the car stays with you. In Chapter 7 you make a formal choice about the car loan within a set period after filing, and the right choice depends on your numbers. We walk you through it so you choose well.

One more point worth knowing: the discharge ends your personal obligation on a loan, but a car loan is also a lien on the car. To keep the car, you keep paying for it.

Sooner than most people expect. If you are behind on your debts, your credit is already taking damage every month, and a filing is treatment for an injury already taken. A discharge erases the debt side of your debt-to-income picture, and that is a major scoring factor. Many people begin receiving credit offers surprisingly soon after discharge, partly because lenders know a fresh filer cannot file again for years.

Secured credit cards are commonly available within months, and auto financing generally follows. At your free consultation we will tell you what to expect in your situation.

Chapter 7 erases qualifying debt outright, usually within a few months. Chapter 13 restructures your debt into a payment plan based on what you can actually afford. The plan runs three to five years, and remaining qualifying balances are discharged at the end. Chapter 7 is faster.

Chapter 13 can protect things Chapter 7 cannot, most importantly a home you are behind on or property with significant equity.

No. A private debt consolidator has to ask your creditors to cooperate. The creditors are free to refuse, keep charging late fees, or sue you anyway. A Chapter 13 plan operates under federal authority. A plan that meets the requirements binds your creditors whether they like it or not.

Late fees stop stacking, and you make one payment to a trustee instead of juggling accounts. One warning. Many of these companies are not lawyers at all, and some are not legitimate. Never trust anyone with your case unless you can verify they are a licensed, practicing lawyer in your own state.

In Illinois you can check for yourself, free, at iardc.org.

The trustee is the court officer appointed to oversee your case. The trustee reviews your paperwork, verifies accuracy, and administers the process. Dealing with the trustee is our job, and we handle it for you. Each trustee runs cases a little differently.

Knowing those tendencies is part of what three decades of representing clients in these courts buys you.

No. All debts must be listed in the case. After your discharge you may voluntarily repay anyone you choose, and many people do exactly that with a family member or a trusted doctor. If repaying someone matters to you, tell us at the consultation and we will plan for it the right way.

The protection starts immediately. The automatic stay takes effect the moment the case is filed. In many Chapter 7 cases the discharge arrives within a few months. A Chapter 13 plan runs three to five years.

In most cases, yes. The automatic stay takes effect the moment a case is filed. In most cases it stops wage garnishments, bank levies, repossession, collection lawsuits, and the calls. That is federal law, not a negotiation.

Timing matters though. The stay stops what has not happened yet, not what has already been taken.

Yes. Bankruptcy is one of several tools, and which one fits depends on where your case stands and what you want. Chapter 13 can stop a sale and spread the arrears over three to five years. Arrears are the payments you have missed.

There are also options outside bankruptcy entirely. → Save Your Home covers all of them.

It may not be. Federal rules restrict a servicer from pursuing foreclosure while a complete request for help is properly pending. Which rules apply depends on your loan and your servicer. Bring us everything you submitted and every response you received, and we will check what happened against what was required.

Not without advice. Depending on your situation, continued payments may preserve options for you, or they may be money spent on a home you will not keep. This is a numbers question with a knowable answer, and we can run it with you quickly.

Sometimes. Older income taxes may be erased in Chapter 7, generally those more than three years old where the returns were filed on time. Where a tax cannot be erased in Chapter 7, Chapter 13 can force the taxing authority to accept a structured repayment plan. The rules here are technical, so bring your tax history to the consultation.

The hardest category, but not a hopeless one. Discharging student loans requires proving a level of hardship beyond the normal standard. Chapter 13 can also bring the loans under control, structuring payments or deferral while your other debt is cleared away. That is often what makes the loans survivable.

Often, yes, when the suspension is about money. Licenses suspended over an unpaid accident judgment, toll violations, or parking tickets can generally be cleared by addressing the underlying debt through the case. That often happens quickly after filing. Suspensions with a DUI involved follow different rules.

Tell us why the license was taken and we will tell you what is possible.

Typically erased: credit card balances, medical bills, personal loans, payday loans, old utility and phone accounts, your personal liability on most civil judgments, and deficiency balances left after a repossession or foreclosure. Typically not erased: child support, spousal maintenance, most student loans, recent income taxes, criminal fines, and debts obtained by fraud. → Debt Relief has the full picture.

The consultation is free. There is no charge to find out where you stand and no obligation afterward. If you hire us, you will know your fee before you decide. In Chapter 13, much of the fee can often be paid through the plan itself, so less money is needed at the start than most people expect.

The law allows a person to file alone. The paperwork is sworn under penalty of perjury, several choices in it are difficult to undo, and the deadlines are unforgiving. If cost is the concern, say so at the consultation. Arrangements exist, and cost should not be the reason you face this alone.

Nothing is required to start the conversation. If you want to make it as useful as possible, bring recent pay stubs, the bills and collection letters, anything you have been served with, and your last tax return. Even names and rough numbers are enough for a first map of your options.