- July 31, 2024
- Thomas Adam
- Bankruptcy
When you are in deep financial trouble, one option may be Chapter 7 bankruptcy. Chapter 7 bankruptcy is also called liquidation bankruptcy. It is a type of personal bankruptcy that helps you quickly eliminate most types of debts. This type of bankruptcy is best for those who do not have the ability to consolidate and make regular payments. Instead, you will keep a limited number of assets and some of your property may be sold to repay debt. Once you go through Chapter 7 you will essentially have a fresh start.
Complete the Credit Counseling Course
The first step, before you begin the bankruptcy process, is to enroll and complete a credit counseling course. The course is a requirement for both Chapter 7 and Chapter 13 bankruptcies. Timing is critical when taking the credit counseling course. You must complete the course within 180 days of filing before filing bankruptcy or no later than 15 days after filing. You must take a debtor education course from an approved provider. You must pay for the course, request a waiver, or set up a payment plan with the provider.
Provide Information and Tax Returns
During the first two weeks after filing bankruptcy you must provide information to the trustee appointed to your case. A meeting with your creditors will be scheduled. You must submit your tax returns no later than 30 days after filing or seven days before the creditor meeting, whichever comes first. This meeting is called a 341(a) meeting.
341(a) Meeting
The 341(a) meeting is a meeting with your creditors. The first meeting typically takes place about a month after you file bankruptcy on average. Your creditors will review the details of your bankruptcy and the debt you owe. There may be another creditor meeting to finalize the repayment agreement. The meeting may be done remotely. You must file a Statement of Intention no later than 30 days after the first creditor meeting. The Statement of Intention tells the court which of your secured assets you wish to keep.
Complete Financial Management Training Course
In addition to the credit counseling course that you took at the start of your bankruptcy, you must also complete a financial management training course. While the credit counseling course focuses more on your past debts, the financial management course provides education on how to better manage your future finances so you can prevent getting into financial hardship in the future. The course must be from an authorized provider. If the provider does not report that you completed the course, you must file Form B423. The deadline to complete the course is 60 days after the first creditor meeting.
Finalization and Discharge Granting
Once you have the details of debt discharge and liquidation resolved, you will finalize the agreements. This is called reaffirmation. The date of the reaffirmation depends on the length of time it takes to work with creditors. Generally, this will happen about two months after the first creditor meeting. Once everything is ready, the matter will go through the court, and the judge will review the details of your case. If everything is in order, the judge will grant a discharge, which will complete the formal bankruptcy process.
Bankruptcy may take anywhere from a couple of months to several or more months to complete. The more prepared you are in advance, the faster and more efficiently your bankruptcy will proceed. A knowledgeable bankruptcy attorney will guide you through the process to make it easier and less stressful. To learn more about bankruptcy, contact our legal team at Adam Law Group at (904) 675-1881 to request a consultation.