Estate Planning




11855 SW Ridgecrest Dr.,
Beaverton, Oregon 97008
(503) 644-0667
Fax: 644-6398

Chapter 7: This is the most common type of bankruptcy for consumers. It is also known as the "liquidation" or "fresh start" bankruptcy. The debtor is allowed to discharge almost all of their debt and be free of debt when the bankruptcy is over.

Chapter 13: This type of bankruptcy is not as common for consumers. This is also known as the "payment plan" bankruptcy. A chapter 13 is more complicated and expensive. Your debts are consolidated and you repay part or all of your debts through the bankruptcy court.

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Which Bankruptcy is right for you?

The best way to decide whether you file a Chapter 7, Chapter 13, or at all is to talk with a qualified bankruptcy Attorney at the Divorce & Family Law Clinic.

The following is a list of the major issues you should consider when deciding whether to file a Chapter 7 or Chapter 13:

Net Value of Assets
Amount of Debt
Type of Debt
Who is the Debt Owed to
Monthly Net Income
Family Size (living expenses)
Exempt Assets
Dischargeability of Debts

Generally, a debtor with only exempt assets and more debt than they can pay after paying their necessary expenses will file a chapter 7. Most debtors in trouble fall into the Chapter 7 category.

A debtor usually chooses chapter 13 when they have non-exempt assets they want to keep, or special tax issues, or assets that are "upside down" in debt that the debtor wants to keep.

These are very short examples of when to choose a chapter 7 or 13 and they may or may not apply to you. Speak with an attorney and be sure.


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Q: If I file bankruptcy, will the court take everything I own?

A: No. Every debtor is allowed to keep some (usually all) of his or her property up to the exemption limit in Oregon.

For Example:

Single Person:
Married Couple:
Motor vehicles with net equity of $1,700
Residence with $25,000 of net equity
Household furnishings worth $3,000
Motor vehicles with net equity of $3,400
Residence with $33,000 of net equity
Household furnishings worth $3,000


Net Equity is equal to the Fair Market Value of the item or property, less any loan outstanding against the item or property.
Fair Market Value is the amount a willing buyer would pay for your particular piece of property (think "garage sale" value for your personal property).

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Q: Will I ever get credit again?

A: Yes. You may not get the best financing rates at first; however, some lenders view the recently bankrupt as good risks because you cannot file again for 7 years. The bankruptcy will show on your credit report for 10 years. You will need to rebuild your credit to show lenders you have become responsible. It does affect your credit rating; that is why bankruptcy is the last resort when you have money problem.

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Q: What should I bring to my Free Initial Consultation?

A: A list of all your creditors and the amount you owe to each
Approximate value of assets with secured debt. e.g. house, car, etc.
Copy of any divorce decree
Copy of any court proceedings filed by or against you (or your spouse, if joint) in the past year. e.g.: foreclosures, small claims or circuit court judgments, garnishments, evictions, etc.
Approximate amount of your take-home pay each month.

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Single Person

(or married person filing w/o spouse) starting at $400 (1 secured creditor and/or 10 unsecured creditors)
  $500 (2 secured creditors and/or 15 unsecured creditors)
Married Couple starting at $500 (1 secured creditors and/or 10 unsecured creditors)
  $600 (2 secured creditors and/or 15 unsecured creditors)
(Additional unsecured creditors: $5 each)
(Additional secured creditors: $25 each)
Filing Fee for Chapter 7 $200 (for single person or for a married couple filing jointly)


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Unsecured Creditor: This creditor loaned your money without taking any security interest against property you own. Typical unsecured debts are MasterCard, Visa, Discover and American Express cards, etc.

Secured Creditor: This creditor has a security interest in a piece of property your own and is quite often created when you purchase the property. Typical secured debts are car loans, house mortgages, store credit cards you used to buy those "big ticket" items like furniture, appliances, or electronics. The most common secured store credit cards are Sears, Levitz, Circuit City, etc.

Sometimes it is difficult to tell if the debt is secured. Our staff attorneys at Divorce & Family Law Clinic can help you sort this out at your fee initial consultation.

The sooner you call Divorce & Family Law Clinic, the sooner you can start your new debt free life.

11855 SW Ridgecrest Dr.
Beaverton, Oregon 97008
(503) 644-0667

Fax: 644-6398

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NOTE: Due to the rules which govern attorneys, NO LEGAL ADVICE will be given over the phone or Internet. You must schedule an appointment to talk with our staff attorney to obtain legal advice. Divorce & Family Law Clinic, Copyright 1998-2004