Bankruptcy is a complicated procedure but just like with anything, if you take a step back and look at it as a step-by-step procedure then the complicatedness will rapidly dissolve. Chapter 7 bankruptcy includes a trustee selling off all the debtor's nonexempt possessions and distributing payment to the debtor's various lenders. But what are the nuts and bolts of the process? How does it start and end?
Filing Chapter 7 Bankruptcy
All the necessary information.
Complete information on your creditors and their names, contact info, and amount of debt owed; your salary and its source, frequency, and amount; a complete list of your assets as well as a list detailing your cost of living.
A petition.
It is strongly recommended you retain a licensed bankruptcy attorney at this point. He or she'll assist you in filling out your petition with the court for filing Chapter 7 bankruptcy. Before filing you'll have to undergo a "means test" which will determine your eligibility for filing Chapter 7 bankruptcy.
Automatic stay.
This is positive news for the debtor because it is essentially the court telling all the creditors to "back off." Creditors are notified that bankruptcy has been filed and they're no longer allowed to contact the debtor regarding collection payments.
341 Meeting.
This meeting is a chance for any of your creditors to voice any objection they may have pertaining to your bankruptcy and the exempt belongings you included. Chances are no lenders will bother showing up if they cannot realistically get fifty cents on the dollar owed to them. The petition is OK'd and the court-appointed trustee sells off all applicable nonexempt belongings.
You're contacted via mail within 90 days whether or not you have been granted a remove on your remaining loans. This means you're no longer legally obligated to pay off the loans. Remember that you're not eligible for remove on certain loans like alimony, kid backing, student loans, etc. You will still be responsible for paying these off after your bankruptcy.
Your credit.
Once the legal process of the bankruptcy has run its course it's now time to start the arduous, years-long task of rebuilding your credit to a respectable rating. The economic management course required should help you in building a plan to complete this goal.
Get Started Today
Contact a licensed bankruptcy lawyer today and go over your case with them. From there you'll have a positive idea of whether or not bankruptcy is the course of action most appropriate for you and, if so, which type of bankruptcy.
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Activities During the Process of Filing Chapter 7
