Bankruptcy Information

The following is a bankruptcy information that I give to all my bankruptcy clients.

INFORMATION YOUR ATTORNEY NEEDS TO EVALUATE YOUR CASE:

  • Tax returns for the past two years
  • Bank statements for the past three months
  • Paycheck stubs or other proof of income for the past six months
  • Completed bankruptcy client information sheet
  • Copies of your driver's license and Social Security card

CREDITORS MEETING

When you file bankruptcy, you will have to attend a creditors meeting. The creditors meeting is conducted by the trustee and gives your creditors a chance to appear and ask you questions. The trustee is appointed by the Bankruptcy Court to oversee your case. The trustee sets the time and date for the creditors meeting; I do not have any control over when it is set. You need to arrive 30 early and bring a picture ID (driver's license) and proof of your Social Security number (Social Security card). I will attend the creditors meeting with you.

CHAPTER 7

You can file Chapter 7 bankruptcy depending on your income if you are current on your payments to secured items that you want to keep such as your house and your car. If you can file Chapter 7 bankruptcy, you will receive an order from the court that relieves you of your obligation to pay certain debts. This is called a discharge. You will need to discuss with your lawyer the debts that you can discharge. If you want to keep certain items such as your house and your car, you will have to sign a reaffirmation agreement with the creditor. A reaffirmation agreement states that you agree to keep paying the debt as you have been paying. It is your responsibility to contact the creditor and request a reaffirmation agreement.

CHAPTER 13

If you are behind on a secured item that you want to keep such as your house or a car, you will probably need to file Chapter 13. If you have had a previous Chapter 13 case dismissed within the past year, you may not be eligible for Chapter 13. In Chapter 13 or wage earner bankruptcy, you must have monthly income. We will submit a plan to the trustee to repay your creditors. Your income must be enough to cover your plan and your monthly expenses.

Your plan will last from 36 to 60 months and during that time, you will make payments to the trustee. If you have income from a job, the payments will be withheld from your pay and sent to the trustee. If you are self-employed, you will have to make the payments yourself. It is your responsibility to make sure that your payments are sent to the trustee. You must make a payment within 30 days of filing your petition.

When your plan is paid, debts that are paid off through the plan will be paid in full. Other debts that take longer to pay off such as your mortgage will be current when your plan is paid and you will just continue to make your normal monthly payments after the bankruptcy is closed. You must provide the trustee with copies of your tax returns every year you are in your plan.

CREDIT COUNSELING AND FINANCIAL MANAGEMENT

Whichever type of bankruptcy you decide is right for you, you must complete credit counseling before you file, usually over the phone and/or the internet. You must also complete a financial management course or debtor education course before you receive your discharge.