"Debtors receive a discharge in more than 99 percent of chapter 7 cases"
- U.S Department of Justice
Most Chapter 7 cases are very straightforward, and require you to follow very specific steps. If you do things right, it should take 100 days from the day you file with the court until the day your debts are discharged. You should expect to pay $335 in court filing fees and $60-$100 in online education costs. If you file on your own, you may qualify for a for a bankruptcy court fee waiver. You should also allow yourself at least a week beforehand to gather your financial information and complete the paperwork.
HOW TO FILE CHAPTER 7 BANKRUPTCY
BEFORE YOU FILE
MAKE SURE YOU QUALIFY FOR CHAPTER 7
: You are only allowed to file for Chapter 7 if your income falls below a federal limit for households of your size in your state. There is a form to fill out to see if you qualify called the Means Test. This form is critical, and is a requirement to file. While the Means Test form the government provides on their site is very hard to navigate, EZBankruptcyForms FREE MEANS TEST
has simplified it to the point where it should only take you about 5 minutes to complete. We provide it on our site to 1) provide a demo of our bankrutpcy software, and 2) allow you to find out if you qualify for Chapter 7 BEFORE you purchase our software (if you don't qualify, there is no need to purchase our software).
ITEMIZE ASSETS AND LIABILITIES
: This will probably take a day or two. Find out current values of autos and homes that you own, your checking, savings, and retirement accounts, household items and jewelry (our software contains links that help you identify current values of cars, homes, etc). Pull a consumer credit report to find the names addresses of your creditors. You may have some debts that have been passed off to collectors, and you will need to list those debts for both the original creditor and the collection agency on your bankruptcy forms to cease collection activities from both parties. Error on the side of caution. If you see a debt on one agency, but not on the other two, include it on your bankruptcy paperwork.
FILL OUT THE PAPERWORK
: Filing Chapter 7 Bankruptcy is essentially pressing the "Reset" button on your financial life. No matter what advice you get, at some point you're going to have to put everything down on paper, and this will take a lot of time. The difference between the definition of "a lot of time" being several hours or several days is based on whether you decide to use some sort of software or not to fill out the paperwork. There are 18-20 separate forms you will need to fill out. Some of those you'll be able to fill out easily WITHOUT some sort of software (for example, the "Statement of Social Security", in which you only type in your name and SSN), and some will be very, very hard without software. Technically, you could do this on your own, without software, but you will find the extra time needed (about 30-40 hours) is not worth the savings in cost.
EZBankruptcyForms BANKRUPTCY SOFTWARE will give you accurate results and save you a lot of time
OBTAIN YOUR CREDIT COUNSELING "CERTIFICATE of COMPLETION"
from one of the Bankruptcy Approved Credit Counseling Agencies
. This is a no-fail online course that will typically take about an hour and cost $30-$50. You MUST include your certificate with your completed bankruptcy paperwork. Typically, when you pass the class online the certificate will be emailed to you the next day.
FILE YOUR BANKRUPTCY PAPERWORK
: EZBankruptcyForms Bankruptcy Court Locator
to find your local bankruptcy court. If you did not apply for a fee waiver
, the court will require a $335 payment by cash or money order.
You should receive a receipt with your case number, Bankruptcy Judge name, Bankruptcy Trustee name, and court date for your "Meeting of Creditors" (about 40 days out). On this date, your "Automatic Bankruptcy Stay" begins. The automatic stay stops all collection efforts (including wage garnishment), all harassment, and all foreclosure actions until the end of your bankruptcy proceedings unless your creditor petitions the court (and you) in writing
. We refer to this as "Day Zero" of your bankruptcy filing.
AFTER YOU FILE
MAKE ANY CORRECTIONS YOU NEED TO MAKE TO THE PAPERWORK, AND PREPARE FOR YOUR "MEETING of CREDITORS"
: The bankruptcy trustee will review your paperwork, and will let you know in writing if any forms are missing. If you find a mistake in one of the forms you initially submitted, now would be the time to submit an ammended form in it's place. All is not lost if you can correct an "honest mistake", and are able to submit it in a timely manner.
In addition, you should be aware that the Trustee will require additional information from you before your "Meeting of Creditors". Respond to every correspondence your trustee or the court sends you that require a response. GATHER YOUR LAST TWO BANK STATEMENTS, LAST TWO MONTH'S PAYSTUBS, LAST YEARS TAX FORMS AND ANY PAPERWORK ON REAL ESTATE YOU OWN.
MEETING OF CREDITORS (around Day 40). Be on time. YOU MUST ATTEND.
Bankruptcy is a Federal Law, so you will be required to bring a Photo ID AND YOUR SOCIAL SECURITY CARD. Don't expect to really see creditors there. You will see other bankruptcy filers. Answer truthfully all questions posed to you by the trustee. They use standard questions - the same for every filer. They will add one or a few other questions to the standard questions as they see fit based on what you filed. Most filers are asked only the standard questions such as: Your name and address for the record. Is the listed social security number correct as was originally issued? Did you read, sign, and understand the petition? Are there any errors or omission? Have you listed all assets and all creditors? Have you filed bankruptcy before? Do you have any or additional domestic support funds?
WITHIN 45 DAYS AFTER THE MEETING of CREDITORS: Submit certificate of completion for your post-filing Personal Financial Management Instruction Course. THIS IS MANDATORY and is a different course from the credit counseling course mentioned earlier. It is an online class that will take two hours to complete and cost about $30-$50. Use EZBankruptcyForms Bankruptcy Approved Debtor Education Providers
list to find agencies providing this service.
WAIT FOR FINAL CORRESPONDENCE SAYING YOUR DEBTS ARE DISCHARGED. Your creditors have 60 days to dispute your debts in writing after your Meeting of Creditors. If you don't receive anything any written correspondence from your creditors (it will be extremely obvious if you do) disputing your bankruptcy and you have submitted your Personal Management Certificate in the time frame mentioned above, your debts should be discharged 61 days after your Meeting of Creditors.
MAKE SURE YOU ARE HONEST!
Don't try to pull a "fast one" on the Trustee -- while he/she may not be able to pinpoint the exact amount of pants you own, he/she is able to access a lot of your personal information once you file for bankruptcy (such as your bank accounts, car registrations and titles to homes), and can either make your life very easy, or very, very, hard.
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