Understanding The Bankruptcy Process

When it comes to filing for bankruptcy, there are several options open to you. One of the options bankruptcy attorneys would recommend would be to file under Chapter 7. In this course of legal action, you as the debtor are not filing with the plans of paying off your debts as under Chapter 13. Rather, all the assets that you have that are non-exempt are then sold off to your creditors. A non-exempt asset is defined as anything that has not been specified to be exempt under the laws that are in place. There are several steps to follow when it comes to filing for Chapter 7 bankruptcy.

File a petition

The first thing that you, the debtor, would need to do would be to file petition. You would also have to include the schedule of your assets as well as liabilities, the schedule of the income you are currently earning, the schedule of any contracts or unexpired leases as well as a statement of your current financial affairs. All this can be done at the bankruptcy court in your locality. Additional information that you would need to provide in your petition forms would be:

• A complete list of your creditors inclusive of the amount of money that you owe each of them
• The source of your income as well as the amount you receive and in what frequency
• A comprehensive list of the properties that you own
• A detailed list of the expenses you have on a monthly basis

Appointment of a trustee

Once you have filed your petition, you will have a trustee appointed to your particular case. This trustee will be tasked with liquidating all the assets that you have that are non-exempt. They will also be tasked with administering your specific case.

Procurement of tax return copies

The next step would be to provide your trustee with a tax return copy. If you are filing for Chapter 7 due to consumer debt, you need to provide your trustee with a certificate that indicates you have gone through debt counselling. You would also need to provide proof of payment from your employers indicating you have received a salary in the last sixty days.

Payment of court fees

The next step would be to pay your court fees for your petition. Keep in mind that the clerk of the court should have received the payment the moment you file for Chapter 7. However, in some instances one may be granted the option of paying in installments depending on the court's discretion.