The Law Office of Damon Smith & Associates

Damon Smith Attorney Bankruptcy

Thank you for contacting our office. We look forward to meeting you and discussing your situation. In order for us to handle your case as efficiently as possible, and to enable us to give you accurate and sound advice, we ask that you bring the information listed below to your office appointment or have it available for a phone consultation. You may also email the information to us at your convenience.

Please call us with any questions or scroll down to see the following!
(Basics of CH7 & CH 13 Bankruptcy or Frequently Asked Questions )


  1. Please provide Driver License and Social Security Cards for you and your spouse if you are filing jointly. (Replacement Social Security cards can be obtained at 203 S. Walnut St. Florence, AL if needed)
  1. Please provide the 2 most recent pay stubs received by you or your spouse. We will need your spouse’s information even if they are not filing with you because the Court requires us to show household income. If you or your spouse receive SSI, SSD, VA disability, a pension or unemployment please bring any document showing how much you or your spouse receive monthly.
  1. Please provide your last two years of tax returns. If you do not have them, we can order your transcripts for a fee of $15. They may also be obtained for free by going to the IRS office located at 204 South Walnut Street Florence Al. 35630 or by going online at Also, if you have not filed taxes and had taxable reported income, please go file your last 4 years of taxes immediately because the case will be dismissed after the meeting of creditors if they are not filed.
  1. Please provide one recent bank statement for any checking and savings accounts in your name(s). Please provide the most recent statement for any cash app, venmo, paypal etc. that deposits into your checking account.
  1. If you can or are suing anyone or will be receiving a financial settlement check for any reason. we will need the case number and attorney address if any. (car wrecks, insurance payments etc.) Also, if you have or will receive an inheritance, I will need to know details including the value and type of property to be received.
  2. If you are paying child support, we will need your ex-spouses name and address.
  1. If anyone has sued you or garnished your wages we will need a copy of the documents you or your employer received from the court to stop the lawsuit or garnishment. If you own or are buying land and you have been sued and a Court Judgement has been issued, you must bring in any judicial liens to enable us to avoid the Liens if possible. If you think you might have any judicial liens go to your county courthouse in the county where you live and any other counties where you have real property, land or a house and ask the Probate office whether there are any judicial liens against you. Please ask the probate office to look this information up and to provide you with a copy of any judicial liens with the plat and page number stamped on them.
  1. If you have a 401k Loan, please provide the Balance Owed $_____ How much comes out of your check $______ And the loan payoff date Month_____ Year______
  1. PLEASE MAKE A LIST OF DEBTS THAT MAY NOT APPEAR ON YOUR CREDIT REPORTS OR PROVIDE YOUR MOST RECENT STATEMENT. Examples: Leases, Pay Day Loans, Check Cashing Loans, Small Loan Companies, Title Loans, Debts made recently. Please also add information showing any child support payees name & address, inheritances you expect to receive, potential recoveries from car wrecks or personal injury cases or settlements. PLEASE MAKE A LIST WITH ANY REAL ESTATE OR VEHICLES YOU HAVE ANY OWNERSHIP INTEREST IN OR PROVIDE US WITH THE MOST RECENT STATEMENT YOU HAVE RECEIVED CONCERNING THE VEHICLE OR PROPERTY.
  2. To get the case filed I will need the following: CH 13 $0 upfront Attorney fee, however we will need $90 to purchase credit reports and other court required documents.  CH 7  $1328 or $1076 + 3 monthly payments of $84 installments for filing fees.

Suggested Do’s and Don’ts prior to your case being filed!

  1. If you have a bank account and you owe money to that bank for a loan etc. the bank can offset or take any funds you have deposited in that bank and apply them to your debt with that bank. This is also true of any joint accounts you are on with a spouse or relative etc. My suggestion would be to remove any deposited funds immediately.
  2. If you have Payday or Check cashing loans, I suggest you either go to your bank and have them discontinue any electronic payments or open a new bank account in a new bank. I suggest this because the check cashing company has any actual check and even though the case is filed, they may try to cash the check anyway and if successful it is very difficult to get the money back.
  3. I would suggest you not call any automobile creditors and ask them questions or otherwise inform them you are filing a case because the unintended result may be they come and reposes your car before I can file the case and stop them from doing so.
  4. If non automobile creditors call you can simply tell them, you have hired us to file a case and they will receive a notice from the court. You may give them our name and phone number.
  5. If you have or will receive any money from Inheritance, Lawsuit Settlement, Insurance payment etc. Do not spend the funds and immediately inform us of the details if you have not done so.
  6. If after your case is filed a creditor calls you record it if possible. If they write you keep the letter. If they try to repossess anything or sue you, please let us know and we may file an AP Claim against them if possible and you may receive money that would be applied to your case or paid directly to you !!!


 Basics of Chapter 7 and Chapter 13

Some clients file Chapter 13 Bankruptcy because they are behind on their house or car payments. Chapter 13 Bankruptcy can stop a mortgage foreclosure and give you three to five years to catch up your past-due payments. Chapter 13 can also allow you time to catch up on late car payments by paying your car note through the CH13 plan, often at a lower monthly amount.

CH7 wipes out most debts but does not catch up back payments on homes or automobiles. You may keep property that is unsecured that has a total value that is less than the Alabama exemptions.

Myself or an Associate Attorney will meet with you without charge to help determine if Chapter 13 or Chapter 7 would best serve your particular needs.

What is Chapter 13 Bankruptcy (commonly called Debtors Court or Debt Consolidation)?

Debt Consolidation, Debtors Court or Chapter 13, is that part of the Federal Bankruptcy Code under which a person may repay all or a portion of his or her debts under the supervision of the Bankruptcy Court. Most people who file a Chapter 13 Bankruptcy do not lose their property. Instead, they file so that they can keep their house, car, and furniture.

Many clients file a Chapter 13 Bankruptcy to prevent their mortgage company from foreclosing on their home. Even if a foreclosure has been started, a Chapter 13 Bankruptcy can stop the proceedings. The late payments can then be caught up over a period of years. 

If you are behind on your car or truck payments, filing a Chapter 13 Bankruptcy will stop the finance company from repossessing the vehicle. In many cases, the amount of the car payments can be lowered.

 If you have credit card debts or loans that have no collateral, you may only have to pay back a small part of what you owe. Under the right circumstances, you can pay off credit cards, medical bills, and other unsecured debts for as little as 1 cent on the dollar.

Also, a tax levy on your wages can be stopped. Garnishments on wages can be stopped. Some liens on real estate can be stopped. Lawsuits can be stopped. Some taxes can be stopped. 

Myself or an associate attorney will meet with you without charge to help 
determine if Chapter 13 would best serve your particular needs.

What is a Chapter 7 Bankruptcy?

Chapter 7 is a liquidation bankruptcy. Individuals who file a Chapter 7 Bankruptcy usually get rid of all credit card debts, medical bills, and other unsecured debts.

 In a Chapter 7, if you want to keep your car and home, you can do so by continuing to make the regular monthly payments. Or, if you 
decide to give the house or car back, you can also get rid of the debt that goes with it.

 If you get a loan by putting up furniture and household goods that you already owned, you can usually keep the furniture and household goods and get rid of the debt.

Wage garnishments can be stopped. Lawsuits can be stopped. Some liens on land can be avoided. To qualify for a Chapter 7, there must be very little equity in your real estate $15000 for individual filer and $30000 joint (married) and no excess income in your budget.  

Myself or an associate attorney will meet with you without charge to help determine if Chapter 7 would best serve your particular needs.

Please scroll down this section to view the various answers to the frequently asked questions concerning CH 13 Bankruptcy.

Following this section you will see a section concerning CH7 Bankruptcy. 


Most clients who have a regular source of income will be able to file a debt consolidation petition without paying any attorney’s fee up front. The attorney’s fee is approved by the court and paid out of the monthly plan payments.


If a client is behind on their house payments they can stop the foreclosure by filing a CH13 case. The client would be able to add their back house payments to the CH 13 case and pay their back house payments over a period of up to 60 months. The client would however continue to make the regular monthly mortgage payment outside the case.


A person can file a CH13 case and prevent vehicle repossession. When the case is filed the vehicle/s will generally be added to the case and paid for entirely through the case over a period of up to 60 months. Often the amount owed on the vehicle and the interest rate being charged by the creditor can be reduced during the CH13 case by filing a motion to value the car and objection to the  interest rate..


Generally most furniture and other  household items are exempt up to $7500 if filing individually and $15000 if filing jointly and therefore would be retained by the client . If an item is secured by a creditor the item can be paid for in the CH13 case or if available a motion can be filed in certain cases to wipe out that creditors secured claim.


Filing a CH13 case prevents any lawsuits from being filed or judgments taken against you. When a client files a debt consolidation case and a lawsuit is pending, it can go no further. If a judgment has been taken, its enforcement can go no further unless allowed by the bankruptcy court.


After a CH13 case is filed a motion is filed that immediately stops garnishments from continuing.


Income tax debts over three years old will usually be wiped out with other unsecured debt if the tax returns were filed promptly. Other taxes that are not wiped out can be paid in the CH13 case over sixty months, usually without additional penalties or interest charges.

After a Ch13 case is filed, the IRS cannot garnish your wages, seize your bank account, close your business, perfect a tax lien or take any other collection effort.

Please scroll down this page to view the various answers to the frequently asked questions concerning CH 7 Bankruptcy.


Generally a client can keep their house when filing CH7 Bankruptcy if they are current on their mortgage payment and they do not have to much equity in the home. The general rule is $15000 for individual and $30000 for a joint case (joint means you and your spouse file together). Please call to discuss how to determining the amount of equity in your home.


If a client is current on their vehicle payment the client will generally be able to keep the vehicle. If the client owns the vehicle free of any debt the client will generally be able to keep the vehicle if it is not valued much over $7500 individual or $15000 joint.


Generally most furniture and other  household items are exempt up to $7500 if filing individually and 15000 if filing jointly, and therefore would be retained by the client . If an item is secured by a creditor the item can be paid for by the client by reaffirming the debt or if available a motion can be filed in certain cases to wipe out that creditors secured claim.( When reaffirming a debt, the creditor will send an agreement to our office, the client would sign the agreement, the agreement will generally say they will keep the property and continue to pay the debt under the original agreement.)


The filing of a bankruptcy prevents any lawsuits from being filed or judgments entered against you. If you file bankruptcy and a lawsuit against you is pending, it can go no further. If a judgment has been entered, its enforcement can go no further, at least not without first getting permission from the bankruptcy court.

After a CH7 case is filed a motion is filed that immediately stops garnishments from continuing.


Income tax debts over three years old can usually be wiped out with other unsecured debt if the tax returns were filed promptly only with a ch13.


Generally speaking, the following debts will not be discharged: Income Taxes, Spousal and Child Support, Debts arising out of willful misconduct and or malicious misconduct by the debtor, liability for injury or death from driving while intoxicated, nonchargeable debts from a prior bankruptcy, student loans and criminal fines, penalties and forfeitures, checks written for goods or services.


You must reside or have a domicile, a place of business, or property in the United States or a municipality.You must not have been granted a Chapter 7 discharge within the last 8 years or completed a Chapter 13 plan.You must not have had a bankruptcy filing dismissed for cause within the last 180 days. It must not be a “substantial abuse” of Chapter 7 to grant the debtor relief. Generally speaking, if after you pay the monthly expenses for necessities there is not enough money to pay the remaining monthly debts, then granting a discharge would not be an abuse of Chapter 7. It would not be fundamentally unfair to grant the debtor relief under Chapter 7.


There are several areas related to this question. You should consult your attorney. In particular there are three items worth mentioning. Under bankruptcy law, certain luxury purchases over $500 within 60 days of the bankruptcy filing are presumed nondischargeable.
Under bankruptcy law, cash advances aggregating $500 within 60 days of the bankruptcy filing are presumed non dischargeable. Debts involving materially false financial statements are non dischargeable under certain circumstances. Do not sell real estate for less than fair market value to an insider such as a relative or business partner.

*$0  down to file case applies to only those clients that qualify and file a chapter 13 under the U.S. Bankruptcy Code who A.) have not had a prior chapter 13 dismissed within the past year, and B.) are not trying to stop a foreclosure within 20 days of filing bankruptcy and C.) will be able to make Chapter 13 plan payments to the Tustee through direct paycheck deduction . D.) Credit reports and credit counseling certificates are provided by third parties and do incur a charge. The Bankruptcy Court for the Northern District of Alabama will in certain circumstances approve an application to pay the filing fee in installments through the chapter 13 plan. The application to pay the filing fee in installments is subject to approval by the U.S. Bankruptcy Court and can be denied.

The following language is required pursuant to Rule 7.2, Alabama Rules of Professional Conduct. No representation is made that the quality of legal services to be performed is greater than the quality of legal services performed by other lawyers. We are a Debt Relief Agency. We help people file for Bankruptcy relief under the Bankruptcy Code. This web site is designed for general information only. The information presented at this site should not be construed to be formal legal advice nor the formation of a lawyer/client relationship.

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