STATEMENT OF INFORMATION REQUIRED BY U.S.C. ' 341

INTRODUCTION:

Pursuant to the Bankruptcy Reform Act of 1994, the office of the United States Trustee, United States Department of Justice, has provided this information to help you understand some of the possible consequences of filing a bankruptcy petition under chapter 7 of the Bankruptcy Code. This information is intended to make you aware of--

. The potential consequences of seeking a discharge in bankruptcy, including the effects on credit history

. The effect of receiving a discharge of debts

. The effect of reaffirming a debt

. Your ability to file a petition under a different chapter of the Bankruptcy Code.

There are many other provisions of the Bankruptcy Code that may affect your situation. This information contains only general principles of law and is not a substitute for legal advice. If you have questions or need further information as to how the bankruptcy laws apply to your specific case, you should consult with an attorney.

What Is a Discharge?

The filing of a chapter 7 petition is designed to result in a discharge of most of the debts listed on bankruptcy schedules. A discharge is a court order that says you do not have to repay your debts, but there are a number of exceptions. Debts which may not be discharged in a chapter 7 case include:

Most taxes, child support, alimony, student loans, court-ordered fines and restitution, debts obtained through fraud and deception, and personal injury debts caused by driving while intoxicated or under the influence of drugs.

Your discharge may be denied entirely if you, for example, destroy or conceal property, destroy, conceal or falsify records or make a false oath. Creditors cannot compel you to pay any debts which have been discharged. You can only receive a chapter 7 discharge once every six years.

What Are The Potential Effects Of A Discharge?

The fact that you filed bankruptcy can appear on your credit record for as long as 10 years. Thus filing a bankruptcy petition may affect your ability to obtain credit in the future. Also, you may not be excused from repaying any debts that were not listed on your bankruptcy schedules or that you incurred after you filed bankruptcy.

What Are The Effects Of Reaffirming A Debt?

After you file your petition, a creditor may ask you to reaffirm a certain debt or you may seek to do so on your own. Reaffirming a debt means that you sign and file with the court a legally enforceable document, which states that you promise to repay all or a portion of the debt that may otherwise have been discharged in a bankruptcy case.

Reaffirmation agreements are strictly voluntary. REAFFIRMATION AGREEMENTS ARE NOT REQUIRED BY THE BANKRUPTCY CODE OR OTHER STATE OR FEDERAL LAW. You can voluntarily repay any debt instead of signing a reaffirmation agreement, but there may be valid reasons for wanting to reaffirm a particular debt.

Reaffirmation agreements must not impose an undue burden on you or your dependents and must be in your best interest. If you decide to sign a reaffirmation agreement, you may cancel it at any time before the court issues your discharge order or within 60 days after the reaffirmation agreement is filed with the court, whichever is later. If you reaffirm a debt and fail to make the payments required in the reaffirmation agreement, the creditor can take action against you to recover any property that was given as security for the loan and you may remain personally liable for any remaining debt.

Other Bankruptcy Options

You have a choice in deciding what chapter of the Bankruptcy Code will best suit your needs. Even if you have already filed for relief under chapter 7, you may be eligible to convert your case to a different chapter. (See the various chapters under bankruptcy which are included in the Notice to Individual Consumer Debtor in the packet of documents. B201)

Again, please consult an attorney if you need further information or explanation, including how the Bankruptcy laws relate to your specific case.