Filing for bankruptcy is a complex process and needs expert guidance to deal with the nuances. Call 888-297-6023 to discuss your case. Although you could file for bankruptcy without lawyer too, Dallas based bankruptcy law firm Recovery Law Group inform, it is not likely to end up with a discharge. The basic steps involved in Chapter 7 bankruptcy are:
- Analyzing your debt
Before filing for bankruptcy, find out which debts will remain even after bankruptcy. These debts include student loan, child and spousal support and any recent tax debts. Any collateral pledged for debt is likely to be taken by a creditor if you fall behind on payments either when you file, during your bankruptcy case or after the case.
- Finding out exemptions
Exemption laws (federal and state) allow debtors to keep some extent of the property. When you file for Chapter 7 bankruptcy, it is important to find out how much equity in the property you can keep. Household furnishings, a modest car, retirement accounts and some equity in the home are exemptions available to Chapter 7 bankruptcy filers.
- Checking eligibility
Chapter 7 eligibility includes passing a means test. Your average gross income for the past six months must be less than the median income for a family of the same size in your state for you to qualify. In case the average income is above the median, your allowed expenses are deducted to find out if you can use Chapter 7 bankruptcy to get rid of your debts.
- Dealing with secured debts
Secured debts like a car loan or house mortgages have collateral attached to them. If you wish to keep the property, you need to keep making payments to the creditor. However, when you file for bankruptcy you have the option to either redeem (pay the creditor the current value of the property as a lump sum amount); reaffirm (continue to make payments to the creditor as per agreement); or surrender the property. In case you remain current on your loan, an agreement can be reached with the creditor to keep your property.
- Dealing with bankruptcy forms
Along with bankruptcy forms, you need to inform the court about your income, assets, expenses, debts and prior transactions, including any property transaction that took place 10 years prior to a bankruptcy filing in Dallas. You also need to provide a comprehensive list of your creditors, property exemptions and decide the course of action for your secured debts. You can file the papers by opting for emergency filing (file a few required forms) or filing all your forms including schedules together.
- Attending credit counseling course
It is mandatory for people filing for bankruptcy to attend a credit counseling course and complete it prior to the filing of bankruptcy papers or shortly after that.
- Pay filing fee or request a waiver
You need to pay fees for filing bankruptcy papers. If you can’t afford it, you could ask for installments, or a complete waiver. If you meet the criterion (household income less than 150% of federal poverty guidelines or insufficient income to pay installments) the judge can issue a waiver.
- Submit relevant documents
You need to submit bank statements, tax returns, pay-check stubs, profit and loss statements mentioned in your bankruptcy papers to the bankruptcy trustee.
- Attend meeting
You need to attend a creditors meeting with the trustee where you will be asked questions that you need to answer under oath.
- File objections
In case you wish to eliminate some liens or dispute any creditor’s claim, you can address these matters before the matter closes. Courts might allow you to reopen a case if you forgot to take care of any lien.
- Handle secured debts
You need to act on your secured debts as mentioned in your bankruptcy papers before the case closes.
- Finish debtor education course
You need to complete the second course (debtor education course) after filing your bankruptcy papers before receiving a discharge. In case you are unable to do so, the case will be closed without a discharge.
- Get discharge
A successful bankruptcy ends with the discharge of your qualified debts. You are no longer legally obliged to pay for those debts.