Bankruptcy in North Carolina, Part 2
Bankruptcy is in the U.S. Constitution
Bankruptcy & The Constitution
In the USA, we long ago recognized the folly of sending people to debtors prison, where they could no longer service any debt at all and were removed both from the economy and the tax base.
In fact, bankruptcy is in Section 8 of the Constitution, listed among the several powers that Congress shall have (namely): To establish a uniform rule of naturalization, and uniform laws on the subject of bankruptcies throughout the United States. . .
The powerful protection of the Bankruptcy Code
In other words, we, the people, have not yet been recognized as being too big to failbut every individual (and business) is recognized as too important to jail. That recognition has led to the codification of the federal bankruptcy laws contained in Title 11 of the United States Code. Known collectively as the Bankruptcy Code (or, simply, the code), together these statutes provide a powerful tool against harassment by creditors and illegal collection practices. Immediately upon filing, for example, creditors are ruled by an automatic stay from the U.S. Bankruptcy Court. This stay prevents them from contacting you anymore (i.e., ends creditor harassment) and says they must now work through the federally mandated procedures within the Bankruptcy Code.
Once the petition is filed, most creditors are forced to shut up, stand down
That, alone, is often cited by debtors as a great relief as they get on about their lives and the business of starting over. Despite many myths about bankruptcyoften perpetuated by the same credit-card industry that pushed so hard for the so-called Bankruptcy Reform Act of 2005 that made it tougher to file for bankruptcy protectionthose who fulfill the courts obligations and obtain their bankruptcy discharge often find their finances and credit in much better shape than they were before filing.
The bankruptcy courts in North Carolina
N. Carolina has three, federal bankruptcy courts, covering the indicated divisions:
- U.S. Bankruptcy Court, Eastern District (for counties within each division, click here)--
- New Bern
- U.S. Bankruptcy Court, Middle District (for counties within each division, click here)--
- U.S. Bankruptcy Court, Western District (for counties within each division, click here)--
- Bryson City
Warning about filing without an attorney
The Eastern District has posted the following via a link on its Web site:
Filing Without the Assistance of An Attorney:
[Although] it is possible to file a bankruptcy case pro se, that is, without the assistance of an attorney, it is extremely difficult to do so successfully. HIRING A COMPETENT ATTORNEY IS HIGHLY RECOMMENDED. Only attorneys, AND NO ONE ELSE, can give you legal advice.
Did you know?
Although many debtors believe that they cannot afford an attorney, many attorneys will work with a debtor to accommodate the debtor's budget.
Many attorneys also offer free consultations.
In chapter 13 cases, a majority of the attorney fees can be paid over time through the debtor's bankruptcy estate.
A review of this court's cases shows a higher likelihood of success in cases in which the debtor is represented by an attorney versus cases in which the debtor is pro se.
Continued in Bankruptcy in North Carolina, Part 3
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