Does Bankruptcy Hold The Key To Your Financial Fresh Start?
Arriving at the decision to file bankruptcy is not an easy process. No one sets out with the intent of filing bankruptcy, but there are times when this legal maneuver is the best option for resolving a debt problem. For many people, filing a Chapter 7 or Chapter 13 bankruptcy case may be the first time they are involved in a court case. On top of being worried and stressed about their financial situation, they are nervous about going to court.
At Saxton Law, PLLC, attorney Saxton and his team members help ease nerves and make the process of filing for bankruptcy relief smoother for Mississippi residents.
Steps To Debt Relief Through Bankruptcy
Understanding the basic steps involved in filing a bankruptcy case is an important start. Some fundamentals are summarized below.
Deciding Which Chapter Of Bankruptcy To File
The first step is to determine whether you need to file under Chapter 7 or Chapter 13. The process begins with completing the means test to determine if you meet the income requirements for Chapter 7 or Chapter 13 bankruptcy.
A review of your finances will include an overview of the types of debt you have, as well as your income, expenses and assets. It is important to choose the correct chapter of bankruptcy or you could lose assets or pay for debts that are eligible for discharge.
Taking A Credit Counseling Course
The Bankruptcy Code requires that debtors complete a credit counseling course before filing a Chapter 7 or Chapter 13 bankruptcy petition.
The U.S. Trustee’s Office provides a list of companies that are authorized to offer the class in each state. The fees for this course are usually nominal and may be waived if the debtor meets specific financial requirements.
After a debtor completes the required course online, in person or by telephone, the company issues a certificate that must be filed with the court.
Gathering Information To Complete Forms
You must complete the bankruptcy petition, schedules and statements to be filed with the court. To do this, you will need certain financial information and personal information including your income, expenses, debts, assets and financial history.
Completing the bankruptcy schedules can be difficult if you are not familiar with bankruptcy law. Mistakes can result in costly delays and denial of your bankruptcy discharge. Working with an experienced professional can ensure the forms are complete and correct before you file them with the court.
Attending The 341 Meeting Of Creditors
The court will schedule your first hearing telephonically, which is referred to as the 341 Meeting of Creditors. It is an informal hearing conducted by the bankruptcy trustee. The trustee places you under oath and asks questions about the documents you filed and your financial situation. Creditors may appear at the hearing to ask questions.
For his clients’ 341 meetings, attorney Saxton focuses on filing everything correctly the first time and clearing facts with each creditor in advance. Any discrepancies are settled beforehand. With this approach, no creditors show up in most cases and the 341 meetings are smooth sailing.
Completing A Chapter 13 Confirmation Hearing
If you file a Chapter 13 bankruptcy case, you also must file a proposed repayment plan. A second hearing is scheduled after the 341 meeting of creditors to resolve issues related to the proposed plan.
Once the plan is confirmed, you will make payments to the trustee each month and follow the terms of the plan until the scheduled repayments are complete. This usually takes three to five years.
Taking A Debtor Education Course
Before receiving your bankruptcy discharge, you must complete a second bankruptcy course. The debtor education course is designed to provide important information about budgeting, credit and wise money management.
You must complete the post-filing debtor education course and file the certificate before the deadline, or you will not receive a discharge.
Receiving A Bankruptcy Discharge
If everything goes well, you receive a bankruptcy discharge at the end of your case. This usually happens a few months after you file for Chapter 7 bankruptcy. Or, it will happen upon completion of your debt reorganization and payment plan for Chapter 13 bankruptcy or your debt reorganization plan for Chapter 11 bankruptcy.
The clerk of court will issue an order releasing you as a debtor and closing the case. Your bankruptcy discharge relieves your legal liability to pay any debt that was discharged in your bankruptcy case. It also prevents creditors from taking any collection action on a discharged debt.
Get Personalized Direction To Understand How This Overview May Apply In Your Case
The above information is a brief overview of the bankruptcy process. Click here to see more articles that attorney Saxton has written regarding bankruptcy. To understand the costs of bankruptcy, click here to see the types of fees and out-of-pocket costs to expect before you sign.
Keep in mind that creditors may file a variety of motions and objections to various aspects of your bankruptcy case. For guidance about the steps involved in your case, contact Saxton Law, PLLC. To learn how bankruptcy may work in your situation, set up a free consultation by clicking Schedule an Appointment above to see our available appointment times, or call or email our firm at (601) 790-0529 or [email protected].
Saxton Law, PLLC, is a debt relief agency that helps people file for bankruptcy relief under the Bankruptcy Code.