You may have never imagined filing for bankruptcy. But many life events can lead honest, hardworking people overwhelmed with debt to consider bankruptcy protection. In Massachusetts, state and federal laws provide options for people to get a fresh start. Bankruptcy, however, is a serious legal matter. You should carefully weigh this decision and discuss the pros and cons with a bankruptcy attorney.

1. How does bankruptcy work?

If you qualify for Chapter 7 bankruptcy protection, a trustee sells your assets to pay your creditors. As soon as you file for bankruptcy, collection activity immediately stops. If your petition for bankruptcy fails, the collection calls may start again.

2. Will I lose everything?

No. You can exempt certain assets from the bankruptcy process. This may include your home, car, retirement accounts, health aids, furniture and most of your wages. If you exempt an asset, you keep it, and a trustee cannot sell it during bankruptcy. In Massachusetts, you can follow either state or federal law to determine exemptions.

3. Will I exit bankruptcy debt-free?

Most debts can be discharged through bankruptcy, but not all. You may still be responsible for taxes, student loans, alimony, child support and legal settlements.

4. Can I file for bankruptcy more than once?

You cannot receive a Chapter 7 bankruptcy discharge if you received a Chapter 7 or 11 discharge within the last eight years or a Chapter 12 or 13 discharge within the past six years. If your first petition for bankruptcy fails, you may have difficulty refiling without legal assistance.

5. What is the means test?

To qualify for Chapter 7 bankruptcy, you normally have to show your household income is below the median for a household of your size in the state of Massachusetts. If your household income is above the median, you may still qualify under certain circumstances.

6. Can I file for bankruptcy without my spouse?

Yes. However the court still requires your spouse’s financial information in order to assess the income of your household. Depending on your circumstances, you may want to file individually for bankruptcy, as a joint petition with your spouse, or as two separate petitions.

7. What are my responsibilities before filing for bankruptcy?

You must complete a debtor education course from an approved credit counselling agency within six months before filing. The certificate of completion must be filed with the court.

8. Will my wages be garnished?

In Massachusetts, you may exempt 85 percent of your gross wages or 50 times minimum wage, whichever is greater, from bankruptcy proceedings. In general, you may also exempt 100 percent of unemployment benefits.

9. Is bankruptcy a matter of public record?

Bankruptcy is a matter of public record and files are available for viewing. However, you can request certain privacy protections from the court. For example, if you have a restraining order against a former spouse, the court can remove your street address from public documents for your protection upon presentation of the order.

10. Do I need an attorney?

Given the serious legal consequences of filing for bankruptcy, legal advice is essential. In addition to helping you decide if bankruptcy is the right option for you, a lawyer can help protect your interests throughout the process. To learn more, contact Konstantilakis Law P.C.