When you’re considering a bankruptcy filing, you may feel like you’re alone, but in truth, there are plenty of people in the same boat that you are: most years see about half a million people filing for personal bankruptcy, with years of economic stress leading to over a million filings.  Working with a bankruptcy attorney and knowing what to expect can alleviate a lot of the stress. Here’s a summary of the process from start to finish.

• Initial meeting – A bankruptcy attorney will assess your financial situation and explain all your options — including debt consolidation and negotiating with creditors — based on your income, debts, and assets. Your responsibility will be to provide the detailed information that they need.
• If you opt for a bankruptcy filing, you must attend a credit counseling session with an approved agency. The sessions take 1-2 hours and ensure that you are making an informed decision. You will receive a certificate of completion at the session’s end. This document is required for your filing.
• Identify whether you will be filing for a Chapter 7 liquidation bankruptcy that discharges all of your debts or a Chapter 13 bankruptcy that creates a new repayment plan. This is determined by your income and debt.
• File the bankruptcy petition. The paperwork will include information on your income, expenses, assets, and debts.
• The automatic stay goes into effect, stopping creditors and collection actions, including wage garnishments.
• Meet with the bankruptcy trustee and your creditors to review the bankruptcy filing. Your attorney will attend this meeting with you.
• Take a debtor education course that teaches you about budgeting and avoiding future financial problems. This is a requirement. After the course, you will be given a certificate of completion that must be submitted to the court to receive a discharge of your debts.
• Agree to the liquidation assets to satisfy debts as ordered by the trustee or agree to the Chapter 13 repayment schedule (usually a 3-5 year plan).
• Discharge of all debts releases you from the obligation to pay most creditors. You will still be obligated to pay child support, some taxes, student debt, and other non-dischargeable debts.

This summary is meant to give you a rudimentary idea of what to expect from a bankruptcy filing. For more detailed information that is specific to your situation, contact us today to set up a time to meet.