A common myth is that bankruptcy is complicated and time-consuming. In reality an experienced bankruptcy attorney helps to simplify the process. And, you will find that Chapter 7 bankruptcy is not as complicated as many people think.
As soon as you are ready to get going, most Chapter 7 bankruptcy cases work as follows:
Free initial consultation: Your first step is to speak with an attorney for a free consultation. The consultation will focus on your financial situation, whether bankruptcy is a good fit, which type of case we recommend, and the cost.
Pre-filing Homework: After the initial consultation, we will email you a detailed electronic questionnaire and a list of documents we need to prepare your case. Before filing you will also be required to complete a Credit Counseling course online. The course generally takes between 1-2 hours.
Filing: Once you pay the fee, complete the Credit Counseling course, and give us all of the requested documents and information, we can file your bankruptcy case. We can file as quickly as you can get these things done—even filing the same day as the consult, when necessary.
Post-filing Homework: We give clients one (1) week after filing to finish any document gathering not done before filing. There is also a post-filing Debtor Education course every filer must complete. The post-filing course also takes 1-2 hours and is provided online.
Meeting with the Trustee: This is supposed to be a Meeting of Creditors (sometimes called a “341 Meeting”), but in most cases the Trustee is the only one present to represent your creditors. DO NOT MISS THE MEETING OF CREDITORS UNLESS YOU WANT YOUR BANKRUPTCY CASE TO BE DISMISSED. The meeting usually happens between 20-45 days after filing. The Bankruptcy Trustee’s job is to figure out which assets you have that can be liquidated on behalf of your creditors. After noting assets of inconsequential value or exempt from liquidation, the Trustee may decide not to liquidate anything. While at the meeting we can also help complete paperwork for contracts (e.g., car loans) that you want to keep in place after the case is finished.
Discharge: Sixty (60) days after the Meeting of Creditors is the last deadline for anyone to make a case to the Court for why your obligation should not be eliminated. Again, this deadline often comes and goes relatively quietly. We normally know well in advance which clients this deadline will be a problem for and will advise when it pops up. On the other hand, if your paperwork is in order, and you have completed your post-filing Debtor Education, and you otherwise qualify, then you will receive a discharge of your debts and be given a chance to hit the reset button on your finances. The “Discharge” is the court order that says you no longer have to pay the debts listed in your case.
Post-Discharge Homework: Once the discharge is entered by the Court, you will still need to comply with any directives given you by the Bankruptcy Trustee, including turning over any tax refunds that have been pulled into the case.
Case Closed: The Court will wait until your Bankruptcy Trustee completes his or her work and files a report that he or she has completed their analysis, liquidation, and distribution of funds before the Court will close your Chapter 7 bankruptcy case. Unless you have uncompleted assignments from the Trustee, you will most likely not know anything is going on or even that your case is still open. On the short end, a Chapter 7 case can take 4-6 months. On the long end, a case with assets to liquidate and extensive documents to review can take 2-3 years. The Court will not mail you notice when the case is closed.
We tell our clients that the most important thing to keep in mind throughout this Chapter 7 bankruptcy process is to be open and honest with us. Keep up with getting us the forms we need and let us know right away if you change jobs or have any other significant financial change. We are experienced bankruptcy attorneys. If you are honest and open with us, we can help you get a fresh start financially, like we have helped so many of our satisfied clients.