How Do I file Chapter 7 Bankruptcy?
You will have to take very specific steps to legally complete the bankruptcy process. If you choose to file Chapter 7 bankruptcy you will be able to discharge many unsecured debts within four to six months from the date you file your bankruptcy petition. Below we will discuss the basic steps to complete a personal bankruptcy.
Steps to file bankruptcy:
- Determine if you qualify for Chapter 7 bankruptcy
The first step in the bankruptcy process is to determine whether or not you qualify to file Chapter 7 bankruptcy. Bankruptcy laws have been updated, making it more difficult for those with a high income or disposable income to discharge unsecured debts by filing Chapter 7 bankruptcy. Talk to a bankruptcy lawyer if you have questions about income limits and Chapter 7 bankruptcy.
- Complete your Chapter 7 bankruptcy petition and the bankruptcy schedules
If you qualify for Chapter 7 bankruptcy the first step is to file the bankruptcy petition and the appropriate bankruptcy schedules. Petitions can be filed jointly with a spouse or separately. Bankruptcy schedules must also be filed and will provide detailed information about your assets and liabilities, executory contracts, unexpired leases, statement of financial affairs, and current income and expenditures. Schedules must be submitted within 15 days from the date the bankruptcy petition is filed.
The good news is after the Chapter 7 bankruptcy petition is filed the court will issue a temporary injunction or automatic stay to stop creditor actions, home foreclosures, property repossession, bank account levies and some wage garnishments. Some collection actions may continue, however, if the creditor asks the court for a motion to lift the automatic stay and it is granted.
At the time the bankruptcy petition is filed you will also have to pay the application fee. If your income is substantially below the poverty level you may be able to have the fee waived.
- Creditors are notified the bankruptcy has commenced
Approximately 18 days after the bankruptcy petition is submitted to the court, the court will mail a Notice of Commencement of the case to the creditors. Creditors may object to the discharge of debts and will be given the date of the 341 Meeting of the Creditors. Creditors may also have a chance to file their Proof of Claims.
- Attend the 341 Meeting of the creditors
Many debtors are concerned they will have to attend a court hearing. Generally, the only meeting you will have to attend is the 341 Meeting or Meeting of the Creditors. This meeting is scheduled approximately 6 weeks after a bankruptcy petition is filed. If you have hired a lawyer they will attend the meeting with you. At the meeting the trustee, who has been appointed to administer your case, will review your bankruptcy petition and schedules and ensure the accuracy of the information you have submitted to the court. Although creditors are allowed to attend the meeting, they often do not. The creditors will have 30 days after the 341 Meeting to object to the filer’s debt discharge.
- Chapter 7 Bankruptcy discharge
Assuming there are no creditor objections and the court approves the bankruptcy petition, most Chapter 7 bankruptcy debtors will have their debts discharged within 60 to 90 days after the 341 Meeting of the Creditors.
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