Cook County Bankruptcy FAQ
Have questions about filing bankruptcy in Cook County? Here are answers to the questions we hear most often. If you don’t see your question here, call us at (312) 346-7400 for a free consultation.
General Bankruptcy Questions
What is bankruptcy and how does it work in Cook County?
Bankruptcy is a federal legal process that allows individuals and businesses to eliminate or restructure their debts under the protection of the court. In Cook County, bankruptcy cases are filed in the U.S. Bankruptcy Court for the Northern District of Illinois, located in Chicago. Once you file, an automatic stay immediately stops all collection activity against you. Depending on the chapter you file, your debts may be discharged (eliminated) or reorganized into a payment plan.
Will I lose everything if I file bankruptcy in Cook County?
No. The vast majority of Cook County residents who file Chapter 7 bankruptcy lose nothing. Illinois bankruptcy exemptions protect your home equity (up to $50,000 per person), your vehicle (up to $3,600), retirement accounts, household goods, and much more. In Chapter 13, you keep all of your assets in exchange for repaying a portion of your debts over time. Our attorneys will review your assets during your free consultation and tell you exactly what is and isn’t protected.
How long does bankruptcy stay on my credit report?
A Chapter 7 bankruptcy remains on your credit report for 10 years from the filing date. A Chapter 13 bankruptcy remains for 7 years. However, many of our clients begin rebuilding their credit within 12 to 24 months of their discharge. Bankruptcy removes the underlying debts from your credit report, which often improves your credit score faster than you might expect.
Can I file bankruptcy more than once?
Yes, but there are time limits between filings. If you previously received a Chapter 7 discharge, you must wait 8 years before filing Chapter 7 again, or 4 years before filing Chapter 13.
What debts cannot be discharged in bankruptcy?
Certain debts survive bankruptcy and cannot be eliminated. These include:
• Child support and alimony
• Most student loans (unless you can prove undue hardship)
• Recent income tax debt (generally less than 3 years old)
• Criminal fines and restitution
• Debts from fraud or intentional wrongdoing
• Most recent traffic tickets and government fines
Chapter 7 Specific Questions
How do I know if I qualify for Chapter 7 in Cook County?
To qualify for Chapter 7 in Illinois, you must pass the Illinois Means Test. This test compares your average monthly income over the past 6 months to the Illinois median income for your household size. If your income is below the median, you automatically qualify. If your income is above the median, we analyze your allowable expenses to determine if you still qualify. Many people who initially think they earn too much actually do qualify once expenses are factored in. Call us for a free means test analysis.
How long does Chapter 7 bankruptcy take in Cook County?
A typical Chapter 7 case in Cook County takes between 3 and 6 months from filing to discharge. The process involves filing your petition, attending a brief meeting of creditors (called a 341 meeting) approximately 30 days after filing, and then waiting for the discharge order. Most clients attend only one short hearing, usually on Zoom video.
Will I have to go to court?
You will attend one brief meeting called the 341 Meeting of Creditors, held at the federal bankruptcy court or via phone/video. This is not a courtroom hearing — it is a short meeting with the bankruptcy trustee, typically lasting 5 to 10 minutes. Creditors rarely attend. Your attorney will prepare you and attend with you. In most Cook County Chapter 7 cases, no actual court appearances are required. These are currently done on Zoom video chat.
What happens to my car in Chapter 7?
If you are current on your car payments and want to keep your vehicle, you can typically do so by reaffirming the loan. If you are behind on payments, Chapter 7 may only temporarily delay repossession. If you own your car outright, Illinois exemptions protect up to $3,600 in vehicle equity. If your car is worth more than $3,600, we can discuss strategies to protect it.
Chapter 13 Specific Questions
How does Chapter 13 stop foreclosure in Cook County?
Filing Chapter 13 immediately stops a foreclosure through the automatic stay. Your Chapter 13 repayment plan then allows you to catch up on your missed mortgage payments over 3 to 5 years, while continuing to make your regular monthly mortgage payments going forward. As long as you make your plan payments and stay current on your mortgage, you can keep your home. Chapter 13 has saved thousands of Cook County homes from foreclosure. This can vary if you have had one or two recently dismissed chapter 13 cases.
How much will my Chapter 13 payment be?
Your Chapter 13 payment is based on your disposable income — what’s left after subtracting your allowable living expenses from your monthly income. Every plan is different. Some clients pay as little as $200 per month; others pay more. The total amount paid through your plan depends on your income, expenses, assets, and the types of debts you owe. We will calculate your estimated plan payment during your free consultation.
What happens if I can’t make my Chapter 13 payments?
If your financial situation changes during your Chapter 13 case, your plan can often be modified to reduce your payment. If you lose your job or face a major unexpected expense, contact your attorney immediately. In some cases, a Chapter 13 can be converted to a Chapter 7 if you no longer qualify for or need a repayment plan.
Practical Questions
How much does it cost to file bankruptcy in Cook County?
The court filing fee for Chapter 7 is $338 and for Chapter 13 is $313. Attorney fees vary depending on the complexity of your case. At Leeders Law, we offer flat fee pricing and flexible payment plans so that cost is never a barrier to getting the help you need. We will give you a clear, all-in price during your free consultation — no hidden fees.
Can I keep my bank account when I file bankruptcy?
Yes, in most cases. You can keep your bank account when you file bankruptcy. However, if you owe money to the bank where you have your account (such as an overdraft or a personal loan), the bank may have the right to offset your account balance against what you owe them. We recommend moving your account to a bank where you don’t owe money before filing. We’ll walk you through this during your consultation.
Will my employer find out I filed bankruptcy?
Bankruptcy is a matter of public record, but in practice, most employers never find out. Your employer will only be notified if you file Chapter 13 and elect to have your plan payments deducted directly from your paycheck (a “wage order”). Federal law prohibits employers from firing or discriminating against employees solely because they filed bankruptcy.
Can bankruptcy stop a wage garnishment?
Yes — immediately. The automatic stay that goes into effect the moment you file stops all wage garnishments. Your employer will be notified to cease the garnishment, and any wages garnished within 90 days of your filing may be recoverable. This is one of the fastest and most powerful benefits of filing bankruptcy.
What is the difference between Chapter 7 and Chapter 13 bankruptcy?
Chapter 7 eliminates most unsecured debts in 3 to 6 months and is ideal for people with limited income and few assets. Chapter 13 creates a 3 to 5 year repayment plan and is better for people who are behind on a mortgage, earn too much to qualify for Chapter 7, or have assets they want to protect. The right choice depends on your income, assets, and goals — our attorneys will help you decide during your free consultation.
Still have questions? Call Leeders Law at (312) 346-7400 for a free Cook County bankruptcy consultation.
Free phone, video, and in-person consultations available. Flexible hours. Multiple Cook County locations.