A “debtor’s exam” is a court order in which a creditor can ask you any questions about your finances in a judicial setting. When you receive a notice to attend an exam in the mail, you’re required to go. Otherwise, if you don’t appear, a warrant could be issued for your arrest.
This is understandably overwhelming, especially if you’re living with debts you can’t pay. Being asked to go to court can spark a lot of questions: What can my creditor ask me during the debtor's exam? How much personal information will I have to reveal? How will this impact my finances?
Let us answer some of these questions for you so that you can go into your debtor’s exam prepared:
What Can My Creditor Ask Me During the Debtor’s Exam?
- Employment information. This includes:
- Where you work.
- How much you make.
- How often you get paid.
- Information on all other sources of income.
- Family information, including:
- If you’re married or single.
- If you have any children.
- What valuable items you own, and where they are located. This includes:
- Real estate.
- Other valuables
- Where you bank.
- If your wages are already being garnished.
- If you would agree to a payment plan
What Will My Creditor Do With This Information?
In the order in which they’re likely to be done, your creditor may:
- Garnish your bank account.
- Your creditor has the right to freeze every penny in your bank account, up to the amount settled on in the judgment.
- Garnish your wages.
- Your creditor may garnish up to 15% of your take-home pay if you’re the primary wage earner for your family. If you don’t have dependents, they can take up to 25%.
- Seize your property.
- Your creditor may send the sheriff an “execution order,” which means the sheriff will seize specific property. This may include a vehicle, trailer, boat, or camper.
- Create a lien on your real estate.
- Your creditor may file a judgment in the district court in the county you own real estate. This will automatically create a lien of your real estate, which would have to be paid if you sell your property.
How Our Lincoln Bankruptcy Attorneys Can Help You Get Through This
A Debtor’s exam is stressful to go through, and it may feel like this circle of debt is never-ending. Please, don’t go through this alone: our Lincoln bankruptcy attorneys at Steffens Law Office are here to help you. We will take you through the steps of bankruptcy, stopping debtor’s exams and your creditors’ follow-up on any collection efforts. We want to help you be free of this endless cycle.
Contact our office online or give us a call today at (308) 872-8327 so our Lincoln bankruptcy attorneys can answer any of your questions and put you back in charge of your finances.