Filing for bankruptcy can often be a major endeavor. Understanding how bankruptcy works is essential to a successful filing. In most cases, you will be filing your bankruptcy papers in the federal court jurisdiction that you are located. This can be determined through various websites or by consulting with a lawyer. In most cases this will be located near your current place of residence.
In most bankruptcy cases, you only have to go to court proceedings to meet with creditors and the bankruptcy trustee. Most of these court meetings are short and simple procedures where they ask a few questions about your bankruptcy forms and your current financial situation. When things get more complex and complications arise, you may have to appear before a judge at a bankruptcy hearing. If you need to go to court for a hearing, you will get a notice of the court date and the time to appear in court.
Filing for bankruptcy will require an assessment of all your assets and business records. You should begin compiling papers such as:
If you are unsure, you may wish to hire a professional such as a lawyer before you begin with the actual filing process. This can help clarify the different requirements that are needed for the process.
Once you have complied the paperwork, you can file with the Bankruptcy court. The bankruptcy judge will then issue an "automatic stay.” After an automatic stay is granted by the judge, no creditors can file any claims against you or make any effort to collect debt from you. During this time, you are required to submit the necessary paperwork that indicates:
(Note: the following is for Chapter 7 bankruptcy only. Other types of bankruptcy involve different procedures).
The Bankruptcy court will appoint a trustee to your case. A court trustee is an individual appointed by the court to handle the bankruptcy. After a trustee has been appointed and all the paperwork has been filed in bankruptcy court, you will then meet with your trustee. At this time, the trustee will gather necessary information from you in order to answer questions about your assets and debts. Your creditors are invited to this meeting. After the meeting, the trustee will sell off some of your property, and divide the proceeds among your creditors.
Finally, once your trustee has completed these tasks, the Bankruptcy court will schedule a final hearing. The judge will discharge any remaining debts that you have. You are now legally free of any debts, and your creditors are forbidden from trying to collect any money from you.
Other points to consider include:
Lastly, bankruptcy laws can often be subject to change. You need to stay informed regarding your financial rights and privileges, especially when it comes to newer bankruptcy changes.
Bankruptcy proceedings can involve many documents as well as many different interested parties. You may wish to hire a lawyer for help if you need to file for bankruptcy. Your bankruptcy attorney can help you prepare your documents and can help with the actual filing process. Also, your lawyer can represent you when you make in-court appearances during the hearings.
Last Modified: 08-27-2015 09:50 AM PDTLaw Library Disclaimer
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