Dixon & Brooks, P.C.
Judith Dixon and Donna J. Brooks
Location: 45 Center Street, Winsted, CT 06098
Phone: 860-379-7531 • Fax: 860-379-7533
E-mails: dbrooks@dixonandbrooks.com • jdixon@dixonandbrooks.com
Hours: Monday through Thursday from 9:00 a.m. to 5:00 p.m., Fridays 9:00 a.m. to 1:00 p.m. Later afternoon/early evening appointments with Attorney Brooks can be accomodated, with some limitations. Please ask if you have a scheduling problem. Initial consultation fee for most types of matters: $20.00. 
AN INTRODUCTION TO BANKRUPTCY.
WHAT IS CHAPTER 7? WHAT IS CHAPTER 13?
Many people do not realize that bankruptcy is a federal law. It is found in the U.S. Constitution, but it was not until 1898 that Congress took a quantum leap in legislative history, and allowed the debtor for the first time to file for bankruptcy protection. Prior to 1898, only creditors could file a bankruptcy petition so as to force the payment of their debts out of the sale of the debtor’s assets.
The purpose of this new expansion of the bankruptcy law in 1898 was to allow debtors a “fresh start” which is in keeping with American philosophy of getting a second chance, a new beginning, when coming to the New World.
Indeed, bankruptcy helped such famous persons as Henry Ford, who filed twice, Walt Disney, who filed once, and Walter Hershey of Hershey Candy Bars, who filed three times. If you decide to file a bankruptcy you are in the company of many other famous Americans who were able to obtain the fresh start and go on to become very successful in their new lives.
You would be surprised at the number of people who ask “Is bankruptcy legal?” or “Will I go to jail?” Debtor’s prison does not exist in this country, and bankruptcy today is designed to safeguard you from what amounts to economic slavery. America is, indeed, the Land of Opportunity, and the bankruptcy law recognizes that sometimes an honest debtor has to re-start, or re-boot, his or her financial engine.
When Congress debated the 1898 bankruptcy changes, they drew on the Bible as precedent, for in the book of Deuteronomy, it was decreed that “Every 7 years there shall be a relaxation of debts in honor of the Lord.” The Pope recently appealed to the major nations of the world, in honor of the Jubilee Year, to cancel the debts owed by the Third World Countries.
Now, what is a Chapter 7 Bankruptcy, and what is a Chapter 13 Bankruptcy? A chapter 7 takes approximately 90 days from the date of filing to the date of the final discharge. You list all of your debts, and all of your assets. You are allowed to keep a certain amount of assets for yourself, through the use of “exemptions,” which can include your house, and car and other personal property, but there are limits on what you can keep. At the end, you are relieved of all of your unsecured debts, such as credit cards, medical bills, lawsuits, and even utility bills. If you decide to keep your house and your car, you need to keep making your payments, and within the limits of your available exemptions, you can keep your home and car.
A Chapter 13 Bankruptcy, on the other hand, lasts from 3 to 5 years, and is a formal repayment plan. It is most often used to stop a foreclosure action when all else has failed, so that if the bankruptcy court decides that you can afford the repayment plan, you will have that 3 to 5 year period to bring your mortgage current. There are other special powers that the court has in a Chapter 13 that are not available in a Chapter 7, such as helping in the repayment of taxes. Chapter 7 Bankruptcy works for most people, but if I think that Chapter 13 is needed, I will tell you so, and refer you to a qualified Chapter 13 Bankruptcy attorney.
There are other non-bankruptcy solutions to certain financial problems, which I will also discuss with you. For instance, did you know that if your income is solely from social security, pension or other protected classes of income, your creditors can never touch your money? If so, we call that being “judgment-proof,” which means that it doesn’t matter how many times you get sued, because there is nothing that can be attached or seized. You may not need to file a bankruptcy at all.
If you are having financial difficulties, the time to act is now. Find out what you can do. Call our office at 860-379-7531 to set up an appointment to see Attorney Brooks for your telephone or in-office consultation.
“We are a debt relief agency. We help people file for bankruptcy relief under the bankruptcy code.”
Bankruptcy & Foreclosure
Related Links and more information about bankruptcy and consumer rights:
www.nacba.com - National Association of Consumer Bankruptcy Attorneys
www.consumerlaw.org - National Consumer Law Center
www.slsct.org - Statewide Legal Services , a pro bono program for individuals in Connecticut who are indigent and cannot afford an attorney, plus more answers to questions about how bankruptcy works.
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