What is bankruptcy?

Bankruptcy is a legal process that allows individuals or businesses to obtain relief from insurmountable debt.  Our office helps individuals or couples file personal bankruptcy with the Bankruptcy Court.

Do’s and Don’ts of Bankruptcy

  • DON’T pull money out of your retirement account to pay off unsecured debt
  • DO look at other options such as bankruptcy, debt consolidation or debt negotiation first.
  • DON’T sell or transfer property (land, vehicles, jewelry, guns) if you are thinking about filing;  If you do absolutely need to sell an item of property for reasonable or necessary expenses
  • DO make sure that you are receiving FAIR MARKET VALUE and preferably to someone outside your immediately family or friend group.  
  • DON’T use your tax refund to purchase luxury goods or expensive vacations.
  • DO use your tax refund to catch up past-due utilities or secured debt, buy your children needed clothing or other necessities, make vehicle repairs or any other reasonable and necessary expenses.
  • DON’T wait until the creditors have starting suing you – this can lead to judgment liens being filed or your wages being garnished;
  • DO talk to an experienced bankruptcy attorney as soon as you realize that you can no longer pay your bills.  
  • DON’T continue to use credit after you have decided that you may need to file bankruptcy since debts incurred in the 90 days prior to filing may not be discharged;
  • DO discuss any recent credit purchases with your attorney so that there are no surprises.  
  • DON’T hide things from your attorney.  One of the worse things you can do is to not be forthcoming in a bankruptcy proceeding.  If your attorney does not know about it, he cannot prepare or guide you in the right direction;
  • DO disclose all assets, debts or potential asset that may be coming your way.


Will I lose everything if I file bankruptcy?

No, there are protections in place to keep those that file bankruptcy from becoming destitute.  Those protections vary from state to state due to income level, household size and value of assets.  

Are all my debts cleared out when I file bankruptcy?

Yes, with the exception of priority debts which are detailed below.

Do I still have to keep paying my house or car payment if I file bankruptcy?

Yes, though the bankruptcy will lift your legal obligation to repay a secured debt, the lender still has the right to take the collateral if the payments are not made.  In short, if you want to keep your house or vehicle, you need to continue to make all payments.  

Do all my creditors have to be included or notified of my bankruptcy?

Yes, but this does not mean you will lose assets that have a debt tied to them.  Many lenders prefer you keep your house, car or other collateral and continue making payments.  

Does my spouse have to file bankruptcy if I do?

No, not necessarily.  Though it is common for a couple to file together, it is not required and in some cases only one person needs to file.  

Will everyone know about my bankruptcy?

No, not usually.  Bankruptcy is a public legal proceeding.  That said, unless you are a prominent person or celebrity, chances are unlikely that anyone other than your creditors or people you choose to tell will be aware of it.

Can I file bankruptcy more than once in a lifetime?

Yes, a debtor can file several times in the course of their lives.  There are limitations of course.  

At least 8 years must pass between Chapter 7 filings.  If a debtor filed a Chapter 7, at least 4 years must pass before they can file a Chapter 13 and receive discharge.  Chapter 13 repeat filers must wait at least 2 years from the first discharge to file the next Chapter 13 and receive a discharge.

Will my credit be ruined forever because of bankruptcy?

No, sometimes it improves very rapidly.  Each case is different, but eliminating debt typically improves your debt-to-income ratio.  Many people are able to purchase vehicles with a loan within months of discharge and even a home within 2-3 years.


Chapter 7 bankruptcy is a “liquidation” or “clearing out” of debt.

Chapter 13 bankruptcy is a “reorganization” plan where debts are consolidated and a monthly payment is made to a Trustee for 36 to 60 months (3 to 5 years).  The Trustee distributes this payment to the creditors in accordance with the payment plan.  

Unsecured debt does not have collateral.  The most common examples include medical bills, credit cards, signature loans, payday loans, delinquent rent or deficiency balances on repossessed vehicles.

Secured debt is backed by collateral.  The most common examples are an auto loan or title loan on a vehicle, a mortgage loan on your home or a purchase money security loan on a storage building or furniture.  

Priority debts are typically non-dischargeable debts (often backed by the federal government).  The primary examples of this are:

Past-due child support or alimony

Unpaid Taxes

Student Loans

Personal Injury claims that result from an at-fault accident that involved being under the influence

Debt that is a result of fraud

Unsecured debt that was incurred within 90 days of filing bankruptcy

Step-by-Step Process

1. No-cost Consultation – Call our office to schedule an appointment that fits with your schedule.  We will ask that you bring with you the following documents:

  • Income documents for your household (usually paystubs for you (and spouse))
  • Your last filed tax return
  • A brief list of your household expenses (mortgage/rent, utilities, food, gas, etc)
  • A rough total of your debts (estimated mortgage, loans, credit cards, medical bills and so on)

Once you arrive to our office, you will complete a brief form giving detailing your personal situation.  Since everyone’s situation is different, this helps determine the best course of action for YOU.  After Mr. Duncan talks with you, he will quote an all-inclusive fee and provide a recommended time line to best address your circumstances.  

2. Retain/Hire the Duncan Law Firm -   Whether you decide to hire us immediately following your consultation, or at a later date, we are here when you are ready.  You will be provided a Retainer Agreement to review and sign.  Depending on your specific situation, you may put down the complete retain or the initial payment toward your overall fees.  At this point, you will receive a list of federally required documents and a more in-depth questionnaire which allow us to draft your documents for the court.  

3. Documents Appointment – This is a scheduled meeting to examine and discuss your documents and completed questionnaire.  This is also a good opportunity to make your final payment.  If any documents or information is missing, we will ask you to do your best to obtain it as promptly as possible.  We are unable to properly prepare your petition and schedules without all the required information. If you are having issues obtaining the necessary documents, we often have a suggestion to assist in obtaining it.  Never hesitate to call, we are here to help!

4. Review and Sign Appointment – Once your specific paperwork is prepared, an appointment is booked to a review of the petition and schedules.  This is an opportunity to ensure accuracy and do any final editing.  You will sign all the required pages of the final draft and be provided with a copy for your records.   The pleadings will be electronically filed with the Court.

5. Court Hearing – This is known as the 341 hearing, or the Meeting of Creditors.  It occurs 3-4 weeks after your case is filed and there is no judge, jury or witness box.  Mr. Duncan will attend with you and answer any questions you have before or after.  The Trustee oversees the proceedings and reviews your case.  Your turn often takes no more than 5 minutes because the Trustee is provided all documents well in advance of your hearing.  Though creditors are welcome to attend, it is very common for none to be present.  This hearing is a required step in the process and you will not be able to complete your case without it.  

6. Patiently Wait – After your hearing, there is a mandatory 60 day waiting period for any objections to your bankruptcy being discharged.   This rarely happens, and a creditor must provide good cause to object.   You are welcome to give us a call if you have questions, but if you do not hear from us during this time, that means all is well.   Once this time has passed, you will receive a notice from the Court and a letter from us with your Discharge (this is the final Order from the Court that you have been working for).