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Frequently asked questions

Learn more about bankruptcy

Understanding your options
Bankruptcy can offer the second chance you need

While it may seem like the last option, filing for bankruptcy can actually end up saving time, energy, and money in the long run.

Many people don’t realize that they can usually keep some of their assets, even their home, after filing for bankruptcy. Our debt management specialist approach is to legally discharge as much debt as possible while allowing clients to maintain a strong financial position going forward.

If you have a low to medium income and find yourself in more debt than you're able to handle, it may be a good idea to consider Chapter 7 bankruptcy. Our bankruptcy law firm will help answer any questions you have so that you can make an informed decision and meet all your deadlines.

Contact us today to learn more about our bankruptcy services.

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Should I file for Chapter 7 bankruptcy?

Filing bankruptcy is not the best option for everyone, but it may be the best debt relief option for you. To understand which route is best for you, it's helpful to understand Tennessee's Chapter 7 bankruptcy laws. Chapter 7 bankruptcy provides relief for individuals experiencing the stress of being unable to make their monthly payments on loans or credit cards due to overwhelming debt.

There are several considerations when determining whether bankruptcy is the answer to your situation. So how do you file bankruptcy in Knoxville, TN?

First is to consider whether you qualify for bankruptcy under Chapter 7, including whether the income requirements under Chapter 7 are met. To determine income qualifications, the Means Test is used (

This test created under The Bankruptcy Reform Act of 2005 considers the debtor’s household income along with household expenses to determine if the debtor qualifies for Chapter 7. If the debtor is not eligible for Chapter 7 bankruptcy, they may be eligible for bankruptcy under a different Chapter.

Consult an experienced bankruptcy attorney to discuss bankruptcy qualifications.

  • The most common bankruptcy filing for individuals is a Chapter 7 filing for "liquidation" of debtors assets. Chapter 7 is the fastest form of bankruptcy and is best suited for individuals with little to no disposable income and whose monthly income falls below the median income for Tennessee. Chapter 7 is the preferred filing because it allows for the discharge of debts and a fresh start for individuals experiencing crushing debt.

    Filing for bankruptcy also prevents creditors from contacting you directly to collect debts and can often provide significant relief to debtors who have experienced harassing phone calls and various other debt collection practices. The attorneys at DZ law firm are dedicated to ensuring all our clients understand both the benefits and drawbacks of filing chapter 7 bankruptcy before filing their case.

  • Chapter 7 bankruptcy allows for the liquidation of the debtor's assets to satisfy debts owed to creditors. Certain assets are exempt from liquidation under bankruptcy. To determine the assets that are exempt from liquidation, it is important to consult a bankruptcy attorney before filing your case with the bankruptcy court. All assets that are not considered exempt are turned over to a bankruptcy trustee and sold to satisfy unsecured creditors’ debts.

    In practice, the debtor rarely has to turn over assets to a bankruptcy trustee. Almost all unsecured debts are eligible for discharge, meaning the debtor is no longer obligated to repay the debt. For secured debts, the debtor will surrender the secured property unless the debtor chooses to assume the debt by either agreeing to make timely payments in the future or by making one large lump sum equal to the value of the secured property.

  • Chapter 7 bankruptcy allows for the discharge of certain debt obligations. Debts that are dischargeable under Chapter 7 bankruptcy include credit card debt, medical debt, personal unsecured debts, civil judgments, back rent from an old lease, deficiencies after a repossession.

  • Certain debts are not dischargeable under Chapter 7 bankruptcy. If a debt is not dischargeable, the debtor will still owe the creditor for the non-dischargeable debt. Debts not dischargeable under Chapter 7 bankruptcy include alimony and/or child support, student loan debts, debts for personal injuries caused by the debtor's operation of a motor vehicle while intoxicated, certain taxes, attorney fees in child custody/support cases, court fines and penalties, criminal restitution.

    Under certain narrow circumstances, some of these debts may be dischargeable, but generally, a debtor will not be relieved of these obligations by filing Chapter 7. Other debts might not be dischargeable if the loan was a result of your misrepresentation to the lender. Dz Law has attorneys that understand these distinctions and will fight to discharge eligible debts.

  • Once you've decided you may want to file for bankruptcy, the first step is to consult an experienced bankruptcy attorney; filing for bankruptcy requires knowledge of bankruptcy law and a dedicated attorney to manage your case. The bankruptcy attorneys at DZ law firm can determine if filing for bankruptcy is the best option and will help you through the process, maximizing your debt relief.

  • It is a natural instinct to want to protect your important assets when considering filing for bankruptcy. Often debtors will transfer assets to family members or close friends in hopes that this will prevent the liquidation of those assets when the debtor files for Chapter 7 bankruptcy. Do not become a victim of this common misconception.

    Assets in your name such as businesses, homes, and vehicles should remain in your name and the transfer of these assets before bankruptcy may appear to be fraudulent and have negative consequences for the debtor. Attorneys at DZ law firm are ready to answer any questions you may have about the steps necessary to prepare yourself for filing bankruptcy, including how to prevent the liquidation of assets.

    1. Do not make large unscheduled payments to creditors: Debtors should continue to make scheduled monthly payments to creditors if they can. Often debtors are unable to make regular monthly payments because they are overwhelmed by debt, however in the unusual situation where a debtor can make a large payment to a single creditor prior to filing for bankruptcy they should refrain from doing so. These types of payments can cause problems in bankruptcy and may lead the court to sue creditors to have the money returned.
    2. Do not take out new loans or credit cards: Do not put yourself further in debt before filing for bankruptcy. Creditors may be able to argue that you opened the new account knowing you were going to file for bankruptcy and had no intent to repay your debts, amounting to fraud. These debts will not be discharged in bankruptcy and you will be responsible for the full debt.
    3. Do not provide inaccurate information: Bankruptcy requires countless documents be filed with the bankruptcy court explaining the nature of debtors assets and claims by creditors. In order to make these filings the debtor will be asked to describe their financial situation accurately. Purposefully mischaracterizing any aspect of your financial situation may lead to negative consequences including the court refusing to discharge a debt or in some cases criminal charges.
  • Creditors are not allowed to contact you directly to collect debt once you have filed for Chapter 7 bankruptcy. Upon filing your bankruptcy case the bankruptcy court will order an automatic stay preventing creditors from attempting to collect debts by any means. DZ law specializes in Chapter 7 bankruptcy and our bankruptcy attorneys can guide you through the process of filing your case and achieving relief from harassment by creditors.

  • Consumer bankruptcy attorneys specialize in maximizing debt relief for individuals, and hiring an experienced bankruptcy attorney can make all the difference when considering debt relief options. A bankruptcy attorney can ensure your case is managed properly and deadlines are met. DZ law firm will make sure your bankruptcy filing meets all requirements and all filings with the bankruptcy court are timely and accurate.

  • Often, debtors can prevent heartache by contacting a bankruptcy lawyer when they first begin to experience overwhelming debt or think they might become delinquent on debt payments. Speaking to an experienced bankruptcy attorney sooner rather than later can prevent situations such as the execution of liens on your property, home foreclosure, and vehicle repossession.

    The lawyers at DZ law firm specialize in assessing client’s financial situations and determining the best course of action for debt relief, including when is the best time to file for bankruptcy and under which chapter to file.

  • The short answer to this question is, no your student loans are not dischargeable in bankruptcy. Though there are some very limited exceptions where a debtor can receive relief from student loan debt most debtors will be required to continue making payments on student loans even after filing for bankruptcy.

    Chapter 13 bankruptcy may benefit you if you are drowning in student loan debt and specifically if you owe a large amount in back payments. For debtors that qualify for Chapter 13, bankruptcy may allow debtors more time in which to pay back their loans or even to make smaller payments on them.

  • The three most common types of bankruptcy are Chapter 7, Chapter 13, and Chapter 11. Though Chapter 7 is prefered for individuals because it allows for the most debt to be discharged, Chapter 13 is available for individuals whose income exceeds the maximum allowed for debtors filing under Chapter 7. Chapter 11 bankruptcy is helpful for businesses that are experiencing overwhelming debt.

  • Chapter 11 bankruptcy allows businesses to reorganize their debts and assets to achieve financial security. Chapter 11 bankruptcy is often the most complex of these three chapters and should only be used as a last resort for businesses facing extreme financial hardship.

    Chapter 11 bankruptcy provides businesses with a plan to pay back debts over time and unlike Chapter 7 bankruptcy for individuals it does not provide for the discharge of debts. Allow a bankruptcy attorney at DZ law firm to assist you in determining if Chapter 11 bankruptcy is the best option for your business.

  • Chapter 13 bankruptcy is often the best option for individuals who are drowning and debt but who do not qualify for Chapter 7 bankruptcy because their monthly income is too high. Chapter 13 bankruptcy allows the debtor to submit a repayment plan to the bankruptcy court that outlines how the debtor will repay certain debts over the next three to five years.

    Like Chapter 7 bankruptcy, certain debts may be discharged under Chapter 13. It is important to consult with an experienced bankruptcy attorney to determine if Chapter 13 is right for you and ensure you receive the most debt relief possible.

  • When filing a Chapter 13 bankruptcy, the court will order an automatic stay. This order will prevent creditors, including mortgage lenders from selling your home at a foreclosure sale to satisfy your mortgage debt. Filing Chapter 13 bankruptcy can give the debtor additional time to pay late mortgage payments and resume making regular payments. Attorneys at DZ law firm can help determine if filing for Chapter 13 bankruptcy is the best option for your situation.

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