What is Bankruptcy
Bankruptcy laws provide a fresh start to people who can no longer afford to pay their creditors. Filing bankruptcy may allow you to keep your home and your car while wiping out other debts, such as credit card debt, second mortgages, medical bills, and old IRS debt. Bankruptcy may stop foreclosure proceedings and stop harassing telephone calls.
In Chapter 7 bankruptcy, your nonexempt assets are liquidated and the proceeds are used to pay your creditors. In a chapter 13 bankruptcy, you pay the amount of your disposable income over three to five years, and the proceeds are used to pay your unsecured creditors.
STOP HARASSING TELEPHONE CALLS
STOP IRS LEVIES
STOP WAGE GARNISHMENTS
How to File for Bankruptcy: The Process
1. In determining where to file bankruptcy and what property you are allowed to keep, you must look at where you currently live, how long you have lived there, and where your assets are located. If your assets are located in, or if you have lived in Fort Myers, Naples, North Ft. Myers, Lehigh Acres, Cape Coral, Bonita Springs, Estero, Punta Gorda or Labelle for at least the majority of the last 180 days before filing bankruptcy, you must file your bankruptcy petition in Fort Myers. The meeting of creditors and all court dates will take place in Fort Myers. If you have lived in Florida for at least two years before filing bankruptcy, you will use the Florida exemption rules listed here to determine what property you can keep if you file bankruptcy. If you lived in another state, our office will have to research the other state’s rules to see what property you can keep.
2. The process of filing bankruptcy begins with a free initial consult to determine if you are a good candidate for bankruptcy. At the initial consultation, we will evaluate your assets and debts to determine whether you should file bankruptcy or if you should consider other alternatives. The consultation lasts around an hour and a half. We recommend that your bring the following documents to your initial consultation: a list of your creditors and the amounts that you owe, your tax returns for the last two years, and your pay stubs for the last two months. If you are self-employed, it would be helpful to bring a year to date profit and loss statement. These documents are not required for the initial consultation but are recommended. If you decide to file, these documents will be required.
0 TO 30 DAYS AFTER FILING: GATHER YOUR DOCUMENTS
3. If you decide to file, we will fill out your paperwork with you and file it with the court. You will need to complete a credit counseling class prior to filing. The class can be taken online, by telephone, or in person. Once filed, your bankruptcy estate is created. Your bankruptcy estate consists of all of your non exempt property in which you have a legal or equitable interest on the date you file bankruptcy. Assets you acquire after your bankruptcy filing date are not part of the bankruptcy estate even if these assets are non-exempt. Do not transfer, sell, destroy, or move property after you file bankruptcy without getting your attorney’s permission
4. Filing a bankruptcy petition invokes the automatic stay. The stay prohibits creditors from continuing with
collection efforts including harassing telephone calls, foreclosure proceedings, and repossession efforts. If a creditor wants to continue with collection efforts after you file bankruptcy, the creditor must file a motion with the court and obtain permission.
5. Shortly after you file bankruptcy, the court will randomly assign a trustee to your case. The primary role of the chapter 7 trustee is to gather all of your non-exempt assets, sell those assets, and distribute the proceeds among all your unsecured creditors. The primary role of the chapter 13 trustee is to determine your nonexempt property and amount of disposable income, receive payments you make in the amount of your disposable income over three to five years, and pay your unsecured creditors with those payments.
30 DAYS: START MAKING YOUR PLAN PAYMENTS AND COMPLETE THE SECOND CREDIT COUNSELING CLASS
6. The trustee’s office will require complete documentation from you at least one week before the creditor’s meeting. The chapter 7 trustees require the last 3 months bank statements prior to filing, 60 days of paystubs before filing, copies of all your car titles or registrations, copy of any deeds to property you currently own, deeds and settlement statements for property transfered the four years before filing bankruptcy, copy of your last two years’ tax returns, payoff statements for all secured debt, copies of last 2 retirement account
statements. If they seek additional documentation, they will contact my office. The chapter 13 trustee typically requests the last six months of your pay stubs and your last two years’ tax returns. Within 30 to 45 days of filing bankruptcy, you should complete the second credit counseling course. If you file chapter 13 bankruptcy, your first plan payment will be due thirty days after filing your chapter 13 plan.
45 DAYS: THE MEETING OF CREDITORS
7. Approximately 45 days after you file bankruptcy you will attend a 341 Meeting of Creditors. Typically, this meeting will last around ten minutes. The trustee will ask you questions about the information contained on your petition and schedules. Your attorney can tell you what questions to anticipate. You are required to attend the creditors meeting with the bankruptcy trustee. If spouses file together, both spouses must attend. You must bring your driver’s license and social security card to the meeting. Your bankruptcy attorney will attend the meeting, as well. Typically, your creditors will not attend the meeting. If you do not attend the meeting and do not reschedule it if missed, the Court will most likely dismiss your case.
90 – 180 DAYS: THE CONFIRMATION HEARING AND DISCHARGE
8. If you file chapter 13 bankruptcy, the Court will conduct a hearing called a confirmation hearing to approve your chapter 13 plan. Usually, you do not need to attend this hearing. Your attorney will attend the hearing. If the court denies your plan, you will need to file an amended plan to cure the objection. Usually, your attorney will be able to resolve any objections with the trustee and creditors. The confirmation hearing typically takes place 90 to 180 days after you file your chapter 13 petition. If your case is filed in the Ft. Myers division, the chapter 13 trustee’s office is very strict in enforcing deadlines. They will allow you to continue your confirmation hearing only once before filing a motion to dismiss your case.
9. Provided that the trustee and creditors do not object to your exemptions or any aspect of your filing, you
will receive a discharge in the mail approximately three to four months after you file your chapter 7 case or at the completion of your bankruptcy plan if you file a chapter 13 case. The discharge is the legal process that wipes out your legal liability to your creditors. Creditors who have been discharged in bankruptcy can never again try to collect debts that you incurred prior to filing bankruptcy.