Timeline of Chapter 7 Bankruptcy Case

Typical debtor(s)’s Chapter 7 bankruptcy case begins once a Petition is filed with the Bankruptcy Court. If the debtors are married, they may file a joint Petition. Debtor’s petition includes schedules listing assets, creditors, income, expenses, executory contracts, leases, and co-debtors. The Schedules are customarily filed along with the Petition. The Declaration Regarding Payment Advices and Credit Counseling Certificate are also usually filed along with the Petition. The filing fee is paid at the time of filing.

After filing Chapter 7 Bankruptcy, the following events take place.

Immediately:

Automatic Stay Order will be issued which prohibits  creditors from sending you letters, calling you, or taking any additional collection and/or legal action against debtor(s). Garnishments on bank accounts and paychecks must stop.

Bankruptcy Trustee will be assigned to your bankruptcy case and Meeting of Creditors will be scheduled.

The date to complete Financial Management Course is scheduled.

Approximately 15 days after bankruptcy case filing:

The Bankruptcy Clerk will mail debtor(s) and creditors the Notice of Chapter 7 Bankruptcy Case, Meeting of Creditors, & Deadlines, which provides the date set for your meeting of creditors and other important deadlines.

Within 30 days of bankruptcy case filing:

Statement of Intention must be filed, informing the court if debtor(s) plan to keep any collateral property or if you intend to submit it to your creditors. The Statement of Intention is usually filed along with the Petition, but debtor(s) can change his/her position on these issues.

14 days before 341 Meeting:

Debtor(s) most recent tax returns, paystubs, real estate documents, vehicle related documents, and other financial information are due to the Trustee 14 days before the date first set for the 341 meeting.

Approximately 4 weeks after bankruptcy case filing:

Meeting of Creditors, often referred to at a 341 meeting, will be held.

30 days after your 341 Meeting:

Deadline for the Bankruptcy Trustee or your creditors to object to your exemption claims.

Debtor(s) must perform his/her intentions as stated in the Statement of Intentions. Debtor(s) will need to surrender the property, reaffirm the debt, or redeem property for the allowed secured claim.

45 days after 341 Meeting:

Debtor(s) must have completed his/her Financial Management Education Course and filed a certificate of completion within 45 days of the first date set for the 341 meeting.

60 days after 341 Meeting:

Creditors must object to discharge of debts that were obtained by false pretenses, a false representation, or actual fraud; debt from fraud or defalcation while acting in a fiduciary capacity, embezzlement or larceny; and debt for willful and malicious injury. This deadline applies to objections to discharge of: consumer debts owed to a single creditor of more than $500 for luxury goods or services obtained within 90 days before a Chapter 7 bankruptcy. Creditors must also object within 60 days of the original 341 date for debts involving misconduct including transfer, destruction or concealment of property; concealment, destruction, falsification or failure to keep financial records; making false statements; withholding information; failing to explain losses; failure to respond to material questions; having received a discharge in a prior bankruptcy case filed within the last 6 years.

Trustee must determine if debtor(s) bankruptcy case should be dismissed due to abuse or debts discharged.

Reaffirmation agreements, if relevant, must be filed with the court.

More than 60 days after 341 Meeting:

Debtor(s)’s discharge will be filed by the Bankruptcy Clerk. However, at this point in time, the discharge is not absolute or final. The trustee can ask that the discharge be set aside if the debtor does not turn over non-exempt property, if the debtor fails to perform other duties, or if there were other matters pending which would result in the denial of the discharge.

90 days after 341 meeting:

All creditors (except for government entities) must file their proofs of claim if they wish to share in the payments from debtor(s)’s bankruptcy case if any assets are available for liquidation.

180 days after bankruptcy case was filed:

Government agencies or units must file a proof of claim within 180 days of the bankruptcy case filing.

Debtor(s) no longer risk losing property acquired or become entitled to after the bankruptcy case is filed as a result of inheritance, bequest, devise, property settlements involving divorce, or beneficiary on life insurance. Any inheritance that debtor(s) become entitled to after the bankruptcy case is filed is at risk of being liquidated by the Trustee if debtor(s) become entitled to it within 180 days of filing.

Final Decree will be entered by the Court officially closing the bankruptcy case. The Final Decree is often received near the time of the Discharge if your bankruptcy case is a no-asset bankruptcy case. If the Trustee is liquidating non-exempt assets, the bankruptcy case will remain open to allow the Trustee to distribute the funds to creditors and file a final report.

The above represents a typical timeline for a Chapter 7 Bankruptcy case.

If you contemplating filing Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, or are dealing with debt problems in Western New York, including Rochester, Canandaigua, Brighton, Pittsford, Penfield, Perinton, Fairport, Webster, Victor, Farmington, Greece, Gates, Hilton, Parma, Brockport, Spencerport, LeRoy, Chili, Churchville, Monroe County, Ontario County, Wayne County, Orleans County, Livingston County, and being harassed by bill collectors, and would like to know more about how bankruptcy may be able to help you, contact me today by phone or email to schedule a FREE initial consultation with a Rochester, NY, bankruptcy lawyer.

Meeting of Creditors and Debtors’ Duty to Provide Bank Statements

Debtors who filed Chapter 7 and Chapter 13 Bankruptcy cases are required to provide certain documents to the trustee prior to the Meeting of Creditors. It is responsibility of bankruptcy attorneys to make sure that all of the required documents are collected in advance and provided to the trustee ahead of the meeting.

According to Bankruptcy Rule 4002, the trustee must be provided sixty days of pay stubs and the most recent tax return.  In addition, debtors who own real estate that they intend on keeping must provide the trustee with some kind of valuation or appraisal.  Here in Rochester, bankruptcy trustees also require copies of deed, mortgage, if any, as well as the most recent mortgage statement.

In addition, Bankruptcy Rule 4002 requires the debtor to bring to the Meeting of Creditors all bank and other financial account statements showing the balances in the accounts on the date the bankruptcy petition was filed.  All bankruptcy trustees here in Rochester adhere to this rule. Turning the statements over at the meeting of creditors will save debtors time and will allow the trustee to resolve any issues related to exempt funds.

If debtors do not have such statements and are unable to obtain them from their bank, Bankruptcy Rule 4002 provides a solution by allowing debtors to submit a verified statement to that effect.

If you contemplating filing Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, or are dealing with debt problems in Western New York, including Rochester, Canandaigua, Brighton, Pittsford, Penfield, Perinton, Fairport, Webster, Victor, Farmington, Greece, Gates, Hilton, Parma, Brockport, Spencerport, LeRoy, Chili, Churchville, Monroe County, Ontario County, Wayne County, Orleans County, Livingston County, and being harassed by bill collectors, and would like to know more about how bankruptcy may be able to help you, contact me today by phone or email to schedule a FREE initial consultation with a Rochester, NY, bankruptcy lawyer.

What Does Debtor Need to Bring to the Meeting of the Creditors?

I have previously written about the meeting of the creditors otherwise known as the 341 meeting.  Among things that the debtors must have a the meeting are their identification and proof of social security number, as well as their original signed bankruptcy petition.

In addition, debtors in Chapter 7 and Chapter 13 Bankruptcy cases are required to provide to the bankruptcy trustee certain documents prior to the meeting.  They usually include the following documents: copy of the petition, copies of counseling certificates, copies of paystubs, copies of deed, mortgage and appraisal if the debtors own a home, a copy of the title and appraisal for any vehicle owned by the debtors, and a copy of last year’s tax return.

In addition, Bankruptcy Rule 4002 requires debtors to bring to the meeting of creditors their bank and other financial account statements showing the balances in the accounts on the date the bankruptcy petition was filed. If the debtors have not brought their statements to the meeting, their attorney will be required to send them to the bankruptcy trustee.

Here in Rochester, and elsewhere, bankruptcy attorneys must bring the original bankruptcy petition to the meeting so that the trustee can compare the signatures on the petition and debtors’s identification documents.

One final procedural item that will take place at the meeting of the creditors is that the debtors will have to sign declaration of electronic filing which certifies that the bankruptcy case was filed electronically. In vast majority of all consumer bankruptcy cases, petitions are filed electronically.

If you are contemplating filing Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, or are dealing with debt problems in Western New York, including Rochester, New York, Canandaigua, Brighton, Pittsford, Penfield, Perinton, Fairport, Webster, Victor, Farmington, Greece, Gates, Hilton, Parma, Brockport, Spencerport, LeRoy, Chili, Churchville, Monroe County, Ontario County, Wayne County, Orleans County, Livingston County, and being harassed by bill collectors, and would like to know more about how bankruptcy may be able to help you, contact me today by phone or email to schedule a FREE initial consultation with a Rochester, NY, bankruptcy lawyer.

Reviewing Your Chapter 7 and Chapter 13 Bankruptcy Petition – A Critical Part of Your Bankruptcy Process

I spend a fair amount of time in 341 hearings.  While waiting for my bankruptcy cases to be called, I listen to the trustee asking debtors and their lawyers questions about bankruptcy petitions.  In my experience, one thing that always that gets bankruptcy trustee worked up, are incomplete or inaccurate bankruptcy petitions.  Because the bankruptcy petition is signed by the debtors who, by signing it, certify its accuracy, debtors’ failure to read their bankruptcy petitions and lack of awareness of factual errors or omissions that they contain may cause significant problems.

While a completed bankruptcy petition usually runs between 30 and 40 pages, it is not an exciting read, and contains plenty of legalese, as well as recitals of the debtors’ financial assets, income, expenses,a a list of all the creditors.  However, by signing it, the debtor certifies that he/she not only read it, but that all information contained in the petition is true and correct, just as if the debtor testified to that information under oath.  At the beginning of every 341 hearing, the trustee asking the debtor if he/she read the bankruptcy petition before having signed it, reviewed it with his/her bankruptcy attorney, and if everything in the petition is true and correct.

Trustees get very upset at debtors because their petitions weren’t accurate or complete.   A typical debtor would tell the trustee, “I didn’t notice a mistake or omission and it needs to be corrected,”  but later admit they did not read the petition carefully.  When the bankruptcy petition is missing important information and that information could have been easily corrected by the debtor, the debtor’s credibility is greatly reduced.  If the petition is completely inaccurate, the trustee can allege that the debtor was engaging in fraudulent and deceptive conduct.

In my practice, I insist that my clients read every page of their petition and review it with me before they sign it.  Even if the client want to rely on my work, the petition has to be read by every client who must understand its contents.

If you are dealing with debt problems in Western New York, including Rochester, Canandaigua, Brighton, Pittsford, Penfield, Perinton, Fairport, Webster, Victor, Farmington, Greece, Gates, Hilton, Parma, Brockport, Spencerport, LeRoy, Chili, Churchville, Monroe County, Ontario County, Wayne County, Orleans County, Livingston County, and being harassed by bill collectors, and would like to know more about how bankruptcy may be able to help you, contact me today by phone or email to schedule a FREE initial consultation with a bankruptcy lawyer.