Bankruptcy FAQ

Chapter 7 discharges qualifying debts in a few months but offers no way to catch up on a mortgage or car loan. Chapter 13 is a three to five year repayment plan that lets you cure arrears, keep property, and protect cosigners, and it is the route when income is above the Chapter 7 means test. Call Jeff at (815) 838-5297 to review both options at your consultation and find the fit for your situation.

Illinois exemptions protect the essentials. As of January 1, 2026, the homestead exemption covers $50,000 of home equity for an individual and $100,000 for a couple who both own the home, and $3,600 of vehicle equity per person, with other exemptions for wages, retirement accounts, and household goods. Most filers keep everything they own. Bring your asset list and call Jeff at (815) 838-5297 to map it against the exemptions.

Yes. Filing triggers the automatic stay, a federal injunction that immediately halts collection calls, lawsuits, wage garnishments, repossessions, and most other collection activity while the case proceeds. Creditors who ignore the stay face consequences for doing so. If a garnishment or court date is bearing down on you, call Jeff at (815) 838-5297 and tell him so the filing can be timed to stop it.

Yes, if you act before the sale. Filing stops the foreclosure through the automatic stay, and a Chapter 13 plan then lets you cure the missed payments over three to five years while keeping up the regular payment. The earlier you call, the more room there is to build a workable plan, so do not wait for a sale date. Call (815) 838-5297.

As of January 1, 2026, the homestead exemption under 735 ILCS 5/12-901 rose from $15,000 to $50,000 for an individual. If the home is co-owned, such as by married spouses, the protected equity rises to $100,000, divided according to each owner's share, and property within these limits is protected from the bankruptcy trustee and creditors. Many homeowners who previously had exposed equity are now fully covered. Call Jeff at (815) 838-5297 to see how the numbers apply to your home.

Several debts generally survive a Chapter 7 discharge, including most student loans unless repaying them would cause undue hardship, recent income taxes and most other tax debt, child support and spousal maintenance obligations which are never discharged, and certain fines and debts from injury caused by driving under the influence. Understanding what will not go away matters as much as understanding what will. Call Jeff at (815) 838-5297 to find out how this applies to your debts.

If the goal is saving a home from foreclosure, Chapter 7 is often the wrong tool, since it can discharge unsecured debt but does not erase mortgage arrears. Chapter 13 creates a repayment plan, typically over three to five years, that lets you pay down past due mortgage payments over time while keeping the home, as long as you keep current payments moving forward. For homeowners behind on a mortgage, Chapter 13 is frequently the more realistic path. Call Jeff at (815) 838-5297 to see which fits your numbers.

Qualification depends on the means test, which compares your household income to the Illinois median for your household size. If you are under the median, you generally qualify for Chapter 7 without further analysis, and if you are over it, additional calculations decide whether Chapter 7 or Chapter 13 fits. Call Jeff at (815) 838-5297 to have the means test run for your situation.

Many Chapter 7 cases move to discharge within a few months of filing. Chapter 13 runs over a three to five year repayment plan, based on your income and circumstances, since the Bankruptcy Code requires a five year plan above the Illinois median income for your household size and generally allows three years below it. Call Jeff at (815) 838-5297 to talk through the likely timeline for your case.

It is a short, routine meeting with the trustee that most filers attend, not a trial, and there is no judge present. The trustee asks basic questions under oath, confirming your identity, reviewing your paperwork, and asking about your assets, income, and any recent transfers of property. Call Jeff at (815) 838-5297 and he will prepare you fully so you know exactly what to expect.

Generally yes, while your case is pending. The co-debtor stay in Section 1301 stops creditors from pursuing individuals who cosigned your consumer debts, and it is strongest when your plan pays that debt in full, while Chapter 7 has no equivalent protection. If a parent or spouse cosigned for you, tell Jeff at the first meeting. Call (815) 838-5297.

No. A filing can appear on your credit report for several years, but many clients rebuild their credit faster than they expect, especially once the debt burden is gone. What matters most going forward is how you manage credit after the case, not just the filing itself. Call Jeff at (815) 838-5297 to talk through what recovery could look like for you.