The scary part of bankruptcy is not knowing what to expect. There are a lot of bankruptcy myths out there that cause many people to not seek out bankruptcy help, even though it can really help them out of a tough spot. Having an accurate understanding of the bankruptcy process usually relieves a lot of stress and can help you work towards becoming debt free. Chapter 7 bankruptcy cases can be broken down into three parts: pre-filing, pre-meeting of creditors, and post -meeting of creditors. This is the first of three articles on the Chapter 7 bankruptcy process. In this article I will focus on the pre-filing stage of your case.
What Can I Expect Before My Bankruptcy Case is Filed?
Usually the first step is the bankruptcy consultation. I, like most bankruptcy attorneys, offer a free bankruptcy consultation where we can discuss your specific situation, go over the basics of a Chapter 7 and Chapter 13 bankruptcy, and determine if bankruptcy is a good option for you. Prior to your consultation it is helpful to have at least a general idea of what your debts are. Sometimes things have gotten so bad people have thrown their hands up and completely checked out when it comes to what they owe and who they owe it to.
Gathering the Information
There is a lot of information required to file a bankruptcy case. The typical Chapter 7 case is about 50-60 pages long when completed. Information like income, expenses, debts, assets, financial transactions, business information, contracts, and the like are required to be disclosed to the bankruptcy court. I work with my clients to gather this information and then prepare the bankruptcy petition, schedules, and statement of financial affairs.
Throughout this process it is vital that the information you provide to my office is accurate. I know this is a pain. Getting information on assets, debts, income, pay stubs, bank statements, etc. are time consuming and tedious. But the more accurate we can be in your bankruptcy filing the smoother the process will go for you once your case is actually filed. Also, be completely honest with your attorney. The penalties for failing to disclose an asset or transaction are severe. When it doubt, disclose. I promise, it will save you (and me) grief down the road.
Before your case can be filed you must complete a court approved bankruptcy credit counseling course. My clients are able to do this online and it takes a little over an hour. It is not a big deal, but must be done before I can file your case.
Paying the Legal Fees
In a Chapter 7 bankruptcy case you will be required to pay all legal fees and court costs prior to your case actually being filed with the court. I go over this at the initial consultation with clients so that arrangements can be made for payment in full prior to filing.
Review and Sign
The final step before your bankruptcy case is filed is the review and sign. This is where we meet and go over all of the documents we intend to file with the court. The purpose of the meeting is two-fold: first, we want to make sure that all the information we are providing the court is thorough and accurate. Second, after your case is filed you will meet with your bankruptcy trustee and be required to testify under oath that you reviewed and signed the documents prior to filing. After this meeting you will have accomplished both purposes.
Filing Your Case
After all the work has been done in gathering information and preparing the documents the day finally arrives to file your case. The bankruptcy court has a pretty slick website that allows bankruptcy attorneys to file cases electronically. This means your case can be filed at any time, 24 hours a day. At the final Review and Sign we will set a date when your case will be filed.
While just a brief overview of the pre-bankruptcy process, it is important to note that this is an important time in your case. The accuracy of the information we provide to the court will help in determining if your case will proceed smoothly or if you will have problems that will delay the final discharge.
As I said above, I offer a free consultation where we can go over your situation. I can be reached at (480) 420-4028 or via email at email@example.com.