Clark & Washington

What Happens After Filing Chapter 7 Bankruptcy in Georgia

Once you have met all the qualifications to file for bankruptcy in Georgia and filed the required paperwork, the next step is for a local court to discharge your case. Keep in mind that a bankruptcy discharge and a bankruptcy dismissal are different legal processes. When a bankruptcy judge discharges your case, it means that you no longer have the legal obligation to pay certain types of debts.

Understanding Your Bankruptcy Discharge in Georgia

The judge’s signature on your bankruptcy discharge papers means that creditors cannot initiate or continue legal action against you to collect a debt. For the purpose of bankruptcy proceedings, legal action can mean making phone calls, sending letters, garnishing a portion of your paycheck, or placing a lien on your personal property. However, creditors who already had a lien in place prior to your bankruptcy discharge may keep it in place and collect what you owe when you sell your home, car, or another piece of valuable property.

A Chapter 7 bankruptcy discharge typically occurs approximately 120 days from the date you initially filed your bankruptcy petition. To receive the discharge, you must attend a meeting of creditors within 60 days of initiating your bankruptcy proceedings. This meeting gives creditors the chance to raise any objections they may have. However, creditors do not always attend this meeting and bankruptcy dismissals are not common.

Another thing you will need to do before a bankruptcy judge can discharge your case is complete a financial management class from an approved vendor. The purpose of this class is to help you understand what led to you filing for bankruptcy in the first place and to receive help with preparing a post-bankruptcy budget.

Once a bankruptcy judge has approved and signed your discharge paperwork, a court clerk mails copies to your Atlanta Georgia bankruptcy attorneys, you, and each of your creditors. The notice to creditors informs them that they must not pursue any additional collection activity or they may be subject to legal consequences for contempt of court.

Selling or Confirming Assets

Georgia law allows Chapter 7 bankruptcy petitioners to keep certain valuable items known as exemptions. Typical examples of exemptions for bankruptcy purposes include:

Tools of the trade, retirement accounts, and a percentage of wages are other common Chapter 7 bankruptcy exemptions in Georgia. A judge can order the sale of all non-exempt personal property to raise money for creditors. Your bankruptcy attorney will walk you through what to expect in this process.

Chapter 7 Bankruptcy and Your Credit

A Chapter 7 bankruptcy remains on your credit report as a public record for 10 years from the date of discharge. You can expect your credit score to drop significantly and to have problems obtaining new credit for a while. However, some creditors may be willing to extend you credit because they know that you cannot file for bankruptcy again for eight years.

Our Atlanta Georgia bankruptcy attorneys recommend that you exercise extreme caution with accepting new credit offers to avoid becoming overwhelmed with debt again. Applying for small lines of credit, such as a department store credit card, can be an effective way to begin rebuilding your credit file and improve your score.

You also need to consider whether you have a co-signer on any of the accounts included in your bankruptcy plan. Because your co-signers are just as liable for repaying the debt as you are, they will have to take on full responsibility for repayment unless they also file for Chapter 7 bankruptcy. When it comes to rebuilding your credit, consider asking someone close to you to add you as an authorized buyer for one of their accounts. The creditor then reports that person’s payment history for both of you.

Atlanta-based bankruptcy attorneys Clark & Washington offer a free consultation to anyone considering filing for bankruptcy in Georgia.

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