If you have recently decided bankruptcy is the right choice for you, you may have questions about how to file for bankruptcy. Understanding timelines as well as the different forms you will need to complete is essential to the success of your bankruptcy case. For many, the paperwork alone can seem overwhelming.
While it is possible to file a bankruptcy case by yourself, referred to as a Pro-Se filing, we strongly recommend that you obtain counsel from an experienced bankruptcy lawyer to avoid mistakes that could lead to loss of your property or dismissal of your case. You must have knowledge of the bankruptcy exemptions that are available to protect your property; otherwise, you risk losing your property in a Chapter 7 case. Statistics indicate that less than one percent of Chapter 13 cases filed Pro-Se are successful due to the complexities involved in completing the paperwork.
A common misunderstanding with respect to hiring an experienced bankruptcy lawyer is that you will have to pay thousands of dollars to get your case filed. In many cases, bankruptcy lawyers will spread out the attorney fee payments in a Chapter 7 case over several months to make them affordable. In a Chapter 13 case, the attorney fees are put into the Chapter 13 plan so you can pay those over an extended period of time through monthly payments to the Chapter 13 trustee.
Regardless of whether you file your case Pro-Se or you hire an experienced bankruptcy lawyer, there a several steps that you must follow. Here, we provide a quick guide on how to file for bankruptcy.
A Guide on How to File for Bankruptcy
Step 1: Gather Your Paperwork.
When you file for bankruptcy, you will need to provide clear and thorough documentation of all of your financial records. This includes itemized lists of any current income (including pay stubs, bank account statements, and retirement accounts), any major financial transactions for the past two years, total monthly living expenses, records of secured and unsecured debts, and any property/assets you own. You should also provide records of any deeds, titles, or loans you may have. For property, you should include appraisals or valuations and mortgage statements. You will also need to provide tax returns for the past two years.
Step 2: Seek Credit Counseling
When you file for bankruptcy, you will be required to demonstrate that you’ve completed a credit counseling course within six months prior to filing your petition. You must use a Department of Justice-approved credit counseling agency. The course typically takes at least an hour and can be completed online, and you’ll receive a certificate upon completion. You must save this form as it is required when you file your bankruptcy forms.
Step 3: Complete AND Print Bankruptcy Forms
There are numerous bankruptcy forms you’ll need to fill out, and they can vary depending on the type of bankruptcy you’ve elected. These forms will require you to disclose information such as the type of bankruptcy you are filing and an itemized list of all your debt. You will need to print out the completed forms to present with your petition. These forms must be single-sided, and you should sign them once they are printed. Along with these forms, you will need hard copies of the following:
- Your credit counseling certificate
- Paycheck stubs for the sixty-day period prior to filing
- Your application fee waiver/installment plan (see below)
Step 4: Prepare Your Filing Fee
Once you have completed your forms, you are almost ready to file. When you file, you will be expected to pay a filing fee. If you do not have the funds to pay, you have a few different options. You can apply for a waiver if your total household income is 150% below the federal poverty line and you can show that you cannot pay the filing fee in installments. Or you can apply to pay your fee in three monthly installments. If you’re granted either of these options, print a copy for your records.
Step 5: File Your Bankruptcy Forms
Once you have completed all of the above steps, you’re ready to file your petition in bankruptcy court. You will submit all forms and your filing fee to the court clerk’s office. At this point, you’ll be assigned a bankruptcy case number. You will also be given the name and contact information of your appointed trustee. Finally, you will be given the date, time, and location of your Meeting of Creditors for a Chapter 7 and an additional Confirmation hearing if you are filing a Chapter 13.
Your attendance at your Meeting of Creditors and Confirmation hearing is mandatory. You must also file a Plan for a Chapter 13 case to show the court what you will be paying through the plan and how your payments will be allocated to your creditors.
Unless you have had two prior cases dismissed within the past year, you will be granted an automatic stay to protect you from debt collection when you file your case. This stay will remain in place until your case is closed unless you have had one prior case dismissed with the past year. If you have had two prior cases dismissed within the past year, you will need to file with the court a motion to impose the stay to obtain protection against your creditors. If you have had one prior case dismissed within the past year, the automatic stay is only in place for thirty days and you will need to file with the court a motion to extend the stay to maintain protection against your creditors for the duration of your case. While there are several factors that can impact your specific case, Chapter 7 bankruptcy cases are typically discharged within three to six months and Chapter 13 cases generally last from three to five years.
Additional Advice on How to File for Bankruptcy
This guide should help you understand many of the main elements of how to file for bankruptcy, but it is in no way exhaustive. Mistakes can lead to catastrophic results if you are not well versed in bankruptcy laws. We want you to understand the general process and we also recommend that you have experienced legal representation through the process. If you have questions about bankruptcy, please reach out to the experienced bankruptcy attorneys at Burrow & Associates at (678) 323-2394.