Planning Beginner: Bankruptcy and Its Alternatives

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Choose wisely. There is only one correct answer to each question.

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Which of the following is true regarding credit counseling and debt negotiation organizations?

The consumer should be very wary of scams.

So called "debt management plans" are almost always more expensive than just dealing with and paying your creditors directly.

Finding a reputable credit counseling agency is an unfortunate matter of luck.

The consumer should be very wary of scams. While there are indeed plenty of scams, the other two statements are false.

Which of the following is true about Chapter 13 bankruptcy?

The information required for the bankruptcy petition is less extensive than for a Chapter 7 bankruptcy.

This form of bankruptcy involves working out a payment plan to creditors.

Secured debts can be discharged more easily than in Chapter 7 bankruptcy.

This form of bankruptcy involves working out a payment plan to creditors. The other options are false.

The Bankruptcy Code allows an individual debtor to protect ________.

His or her home

$10,000 worth of cash or other assets, to be chosen by the debtor

A certain relatively modest amount of property from the claims of creditors

A certain relatively modest amount of property from the claims of creditors. Certain property is exempt under federal law or under the laws of the debtor's home state.

Even if only one spouse in a marriage files for bankruptcy, the income and expenses of the non-filing spouse must be disclosed.

True

False

True. The income and expenses of the non-filing spouse are required so that the household's financial position can be evaluated.

Which of the following is true?

Until the final bankruptcy debt discharge, creditors are permitted to continue "reasonable" collection efforts.

Bankruptcy refers to a set of state laws and rules designed to help provide a fresh start to individual or business debtors.

The US Trustee supervises the administration of bankruptcy cases.

The US Trustee supervises the administration of bankruptcy cases. The other choices are false.