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What to Expect When Filing Chapter Seven Bankruptcy

Filing Bankruptcy may seem like a daunting experience, but it can be easier than you think.

Like many people in today’s economy, Chapter 7 Bankruptcy may be on the horizon.  As much as it may seem like a scary thing, it can be a very smooth process.  It all starts with deciding whether or not bankruptcy is the right option, and this can be done by simply talking with a bankruptcy attorney about your situation.  Most attorneys will offer a free consultation.  This is important because it allows you to tell them your situation, and they will then tell you if bankruptcy is even the right thing to do.  Typically, during the consultation, they will present you with the different options and go over all the details, including costs and time-frames.  They will also give you a large amount of paperwork which you can take with you.  Keep in mind, this is just a consultation, and you are under no obligation at this point.  However, if you do decide to go forward with this attorney, you will then be required to sign a contract, and make your payments. 

Many attorneys offer a payment schedule which is handy, however be aware that they will not file your petition until you have made the full payment.  As for the paperwork, it includes mandatory information that you must fill out, such as all the names and addresses of your creditors, including the amount of money you owe to each.  You must also list all of your personal assets, income, personal information, monthly expenses, etc etc.  It can easily be a full day’s worth of work to complete everything, but remember to be absolutely thorough and accurate to avoid any issues in your case.  Once your paperwork is finished, you will need to gather all your recent bills, your last 5-6 bank statements, pay stubs for at least the last 4 months, all court documents that involve any debt-related lawsuits you are involved in (past and present), and anything else you think may help the lawyer move through your case faster.  Remember, the easier you make it on the lawyer, the faster things will go. In many cases, once you turn in your paperwork, assuming everything is accurate and complete, you can have your case filed within a few days. 

After your paperwork is turned in, you will need to take a mandatory pre-filing bankruptcy course.  This can easily be done online, and take about an hour.  You are responsible for the cost, which is about $5.  Once completed, you will receive a certificate of completion via email, which can either be forwarded to your lawyer, or you can take it in personally.  Your case cannot be filed until this is done.  Now it is finally time to file your petition.  Before filing, you will meet with your lawyer to go over the details of your paperwork, and make any last minute changes if needed.  They will then file your petition electronically, which is immediately sent to the Court, along with all the creditors listed in the case.  Once received, all of your creditors are legally required to cease all collection efforts, including phone calls, mailings, foreclosures, repossessions, pending lawsuits, and wage garnishments.  This process is called an “Automatic Stay”, and is in effect during the entire proceedings.

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