The 7 Main Steps of Filing Bankruptcy
If you are considering filing bankruptcy, we want you to feel comfortable that the process is much simpler and more straightforward than you might think.
Here are the 7 main steps that you should expect as you file bankruptcy:
- Have a consultation with an attorney: Your attorney is your best friend in this process. He or she will walk you through your options and help you decide the best path to take.
- Choose between Chapter 7 or 13: This choice will depend on whether you want to eliminate debt with some loss of assets or keep assets but have debt payments.
- File Chapter 7 or Chapter 13: You fill out the necessary paperwork and submit it to the courts.
- An automatic stay protects you: An “automatic stay” is a legal court order that allows you to be free from debt collections. Creditors are legally bound from pursuing you once you file bankruptcy.
- Attend the 341 Meeting and Confirmation Hearing: The 341 meeting is a non-court meeting with your trustee (the person in charge of looking over your case) and your creditors. It is required for both Chapter 7 and Chapter 13 cases and allows creditors to make sure that your financial statements are accurate. The confirmation hearing, on the other hand, is only for Chapter 13 cases, takes place in court, and deals with verifying the feasibility of your Chapter 13 payment plan.
- Take a credit counseling class: This mandatory class teaches principles of debt management, finances, and budgeting.
- Debt is discharged or paid off over time: In 3-5 months, your Chapter 7 case eliminates your debts completely. A Chapter 13 lets you keep your assets and continue to make payments on debt that are more manageable.
We hope you feel confident in your financial future. Our bankruptcy attorney can answer your questions and guide you through the bankruptcy process in depth.