How to File for Bankruptcy

Step #1 Get A Lawyer

As a consumer, you should research your options regarding filing for bankruptcy. The first step is to contact a lawyer and set up a consultation. Retain a lawyer with whom you feel comfortable discussing your situation and one with the necessary support staff. Be sure that the lawyer you hire is competent to handle your case. You will work closely with this person over the next few months or the next few years in a Chapter 13 Bankruptcy. You want someone with whom you are at ease. If a lawyer is unaffordable right now, take some time to save. It will be worth the wait.

The Bankruptcy Procedure is complex and often counter-intuitive. Lawyers spend years in school and then years practicing before fully understanding bankruptcy procedure and how to file bankruptcy. A non-lawyer will not be able to understand the bankruptcy procedure, even at a basic level, without making a massive time commitment to learning how bankruptcy works.

Step #2 Credit Counseling

Under the Bankruptcy Abuse Prevention and Consumer Protection Act (“BAPCPA”), which substantially amended the U.S. Bankruptcy Code effective October 17, 2005, before filing a bankruptcy case, you must obtain consumer credit counseling from an entity approved by the U.S. Trustee within 180 days of the date of the filing of a bankruptcy case.

This counseling requirement allows consumers filing for bankruptcy to obtain an opinion from another source to help determine whether they should file for bankruptcy protection. You can complete this counseling over the phone or online. Our office has negotiated a $15 fee for this counseling, which includes your spouse if you are filing a joint bankruptcy.

Step #3 Filing Bankruptcy

Once you have retained an attorney or signed your bankruptcy petition, you should tell any calling creditors to contact your bankruptcy lawyer’s office. Your bankruptcy lawyer’s office will then be able to represent you (say goodbye to irritating calls). Once your bankruptcy lawyer has filed your bankruptcy, an “automatic stay” is implemented. This means that creditors cannot legally contact you to seek repayment of your debts.

Once your attorney has submitted your bankruptcy petition, you will be notified by mail of the date for your “meeting of creditors” (or a “341 meeting”, named after the section of the Bankruptcy Code requiring it. This is a meeting with the trustee assigned to your case where they can ask you questions about your bankruptcy case. Your attorney will accompany you to this hearing. Very seldom do creditors appear at this meeting. Note that it is required that you have a state issued photo ID and a document with your social security number on it.

Step #4 Post-Filing Credit Counseling

After your attorney files your bankruptcy, you are required to get post-filing credit counseling, also referred to as debtor education. This education can be done quickly online for a small fee. You must prove that you’ve done this counseling by providing the printed certification you’ll receive after finishing the course.

Step #5 The Meeting With The Trustee Or “Meeting Of Creditors”

This meeting gives the trustee an opportunity to confirm that you have provided honest answers on your bankruptcy petition, comprehend the situation, and agree to file for bankruptcy. Your creditors may also ask questions of you at this meeting, but it is rare that creditors actually show up. You MUST provide a photo ID and proof of your Social Security Number.

Your lawyer will attend the meeting of creditors with you to ensure everything goes smoothly. Before the meeting, you should have reviewed your bankruptcy petition to familiarize yourself with what’s listed and understand the process. Once you are sworn into the meeting, you will be asked questions on the record. In most situations, the meeting is simple and lasts only 3 -5 minutes.

Step #6 Discharge From Your Debts

The only thing you have left to do in your bankruptcy case is receive legal discharge from your debts, meaning that you no longer have a responsibility to pay back your suspended debts and that your creditors cannot, under any circumstances, seek repayment from you. If you filed a Chapter 7 Bankruptcy you will receive your discharge approximately 90 days after you file. If you filed Chapter 13 Bankruptcy, you will receive the notice of discharge approximately 3 to 8 months after your final payment has been made on your Chapter 13 Bankruptcy plan.

Not all debts are discharged in a Chapter 7 Bankruptcy or Chapter 13 Bankruptcy case. Non-dischargeable debt can include student loans, certain taxes or government debt, and alimony and child support, among other things. Whether or not a debt is discharged depends on specific Bankruptcy Code provisions and bankruptcy procedures. It usually takes four to six months after filing for bankruptcy to receive this discharge. At this point, you have reached your fresh start!