What Should You Expect When Filing?
There are 6 Steps when you file bankruptcy. Each step has information that is very important for you to understand, even if you are just thinking about filing.
The Six Steps:
1. Evaluate Your Credit Situation - Determine if Bankruptcy is an Option.
- What are your current debts?
- What are your current assets?
- What is your monthly income?
2. Do You Want to File on Your Own or With Help From an Experienced Bankruptcy Lawyer?
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3. Does Chapter 7 or Chapter 13 Bankruptcy Meet Your Unique Needs? Formulate Your Plan According.
4. Complete Your Petition, File with the Local Bankruptcy Court.
Petition is Document that Characterizes All Debts and What Type of Petition: Chapter 7 or Chapter 13.
5. Federal Law Imposes an “AUTOMATIC STAY”, Prevents Creditors From Taking Action to Collect Debts.
Depending on where you live, the Bankruptcy Court will send out a Notice of Filing and a Notice of Stay to your creditors. This notice makes it illegal for your creditors to continue trying to collect from you and refers them to your attorney.
6. A “Meeting of Creditors” chaired by the Bankruptcy Trustee assigned to your case, is held with your creditors.
Generally, the Trustee will ask you a few form questions and allow any creditors present to ask questions. If the Meeting of Creditors is uneventful, you will receive either a Notice of Discharge if you are seeking a Chapter 7 Discharge or a Notice of Confirmation if you are seeking Chapter 13 Discharge.
If your creditors have issues with your Petition, they have the right to file an adversary proceeding. This proceeding asks the Bankruptcy Court to refuse to discharge certain debts for various reasons. The most common reason is fraud, either giving rise to the debt (i.e.: if you got the money by stealing) or fraud in the bankruptcy (i.e.: you are lying about your assets). An adversary proceeding is like regular litigation and it can take as long as regular litigation. Your discharges of debts are delayed until you adversary proceeding is resolved.
REMEMBER: Bankruptcy is a long process and patience is required.
