People who file for bankruptcy have several exemptions at their disposal to protect their properties from seizure by creditors. Texas residents can use either the federal property exemptions or the Texas property exemptions, but not both. Many residents choose the Texas exemptions because they are considered more favorable. With Texas’ property exemptions, bankruptcy filers may be able to keep valuable assets, such as their homes and vehicles.

Homestead

Texas’ Homestead Exemption provides broad protection for the primary residence of a person filing for bankruptcy. A home of any value may qualify, as long as the property is:

I recently read an article on forbes.com about bankruptcy, and it has been niggling in the back of my mind ever since. The author is not a bankruptcy lawyer, but there he is on the Internet pontificating about the three most important things you need to know about filing for bankruptcy.

He noted that bankruptcy isn’t free, saying that this is a “surprise” to many people. I’m not sure why anyone would have an expectation that filing for bankruptcy would be free. People don’t go to the store and expect to get their groceries for the week for free. They don’t go to the hospital for surgery and expect the surgeon and the hospital to thank them for coming in and provide services for free.

The article goes on to say that most lawyers charge by the hour. While this is true for many lawyers, it is not necessarily the case for consumer bankruptcy lawyers. Most charge a flat fee, which is typically a small percentage of the debts that are discharged and the assets that are protected. Furthermore, unlike other areas of the law, there is oversight of the fees that bankruptcy lawyers charge, because those fees are disclosed as part of the bankruptcy filing (in two different places) and must comply with the local rules of the bankruptcy court.

Before a debtor can file for bankruptcy, they must complete a pre-bankruptcy credit counseling session with an approved provider. Sadly, most simply see this as a part of the process when, in fact, it is a prime opportunity. In fact, for some, the pre-bankruptcy counseling session could be exactly what is needed to avoid filing for bankruptcy. However, even when that is not the case, debtors stand to learn a lot about their financial future. Learn more about how to make the most out of your pre-bankruptcy credit counseling session, and discover how an experienced attorney can assist you with the bankruptcy process.

What Happens During Pre-Bankruptcy Credit Counseling?

Although pre-bankruptcy credit counseling sessions may vary slightly in their curriculum, all include an analysis of your current financial situation, a discussion on what alternatives may be available to you, and a personal budget plan. Debtors may be asked to complete these elements of the course over the phone, in person, or online. Once the debtor has completed the course, they should be issued a certificate of completion. (Note that debtors should not be charged an additional fee for their certificate of completion.)

Filing for bankruptcy may not be an easy decision, but it can give you a chance to start over – a clean slate if you will. What you do with that second chance is, of course, up to you. Make the most of it by learning how to repair your credit after bankruptcy, and learn how an experienced bankruptcy attorney can assist with the process.

Dispelling the Bankruptcy-Credit Myth

The first thing to understand about bankruptcy and your credit is that the impact may not be as drastic as you fear. In fact, a study from the Federal Reserve Bank of Philadelphia found that people’s credit scores typically plunged in the 18 months before bankruptcy but rose quickly once the process was complete. The reason for this is simple: while filing for bankruptcy does hit your credit, the repeated hits caused by late payments and new collection accounts can do more damage over time. Bankruptcy stops the collection process and gives you a new start.

The short answer…absolutely not!  

So what are those numbers, and what do they mean to a person who has filed for bankruptcy?

341 is actually a section in the Bankruptcy Code (the federal law that covers bankruptcy) and the shorthand term for the first meeting of creditors in a bankruptcy case. Don’t get fooled by the word first. In fact, don’t get fooled by the word creditors either. In a consumer bankruptcy case, there typically is just one meeting, and by and large, the creditors don’t attend these meetings, with the possible exception of a disgruntled former spouse.