California Bankruptcy Lawyer Blog

A brief overview of the bankruptcy process:

· The whole Chapter 7 bankruptcy process usually takes about three to six months.

· Before you can file for bankruptcy, you must consult a nonprofit credit-counseling agency. The purpose of this consultation is to see whether there is a feasible way to handle your debt load outside of bankruptcy, without adding to what you owe.

· You must complete a packet of forms and file them with the bankruptcy court in your area. Many filers are shocked to see the long list of documents that might be required in a Chapter 7 case.

· Once you file the papers described below, the court will send a notice of your bankruptcy to all of the creditors listed in your bankruptcy documents. You will get a copy as well. This notice (called a "341 notice" because it is required by Section 341 of the bankruptcy code) sets a date for the meeting of creditors (see Section 7, below) and gives creditors the deadlines for filing objections to your bankruptcy or to the discharge of particular debts.

· Documents to file: "Voluntary Petition" (the official court form that requests a bankruptcy discharge of your debts), lists of your creditors, assets, debts, income, and financial transactions prior to filing; copies of your most recent federal tax return and wage stubs; a list of property you are claiming as exempt (that is, property that you are entitled to keep even though you are filing for bankruptcy); information on what you plan to do with property that serves as collateral for a loan (such as a car or home); and proof that you have completed credit counseling.

· You must compute your average income during the six months prior to your bankruptcy filing date and compare that to the median income for your state. If your income is more than the median, the same form takes you through a series of questions (called the "means test") designed to determine whether you could file a Chapter 13 bankruptcy and pay some of your unsecured debts over time.

· The bankruptcy court exercises control over your property and debts by appointing an official called a "trustee" to manage your case.

· The Creditors’ Meeting: This meeting is typically held somewhere in the courthouse or federal building (but almost never in a courtroom). The trustee runs the meeting and, after swearing you in, may ask you questions about your bankruptcy and the documents you filed.

· The new bankruptcy law requires all debtors to attend a two-hour course on managing finances in order to receive a bankruptcy discharge. You must take this course from an agency approved by the U.S. Trustee Program.

· At the end of the bankruptcy process, all of your debts are discharged except:

--Debts that automatically survive bankruptcy, unless the bankruptcy court rules otherwise (child support, most tax debts, and student loans are examples), and
--Debts that the court has declared nondischargeable as a result of an action brought by the creditor, as might be the case with debts incurred by fraudulent or willful and malicious acts on your part.

· Once you receive your bankruptcy discharge, you are free to resume your economic life without reporting your activities to the bankruptcy court -- unless you receive (or become eligible to receive) an inheritance, insurance proceeds, or proceeds from a divorce settlement within 180 days after your filing date.

Who Can File Bankruptcy in the United States:
· You must reside or have a domicile, a place of business, or property in the United States or a municipality.

· You must not have been granted a Chapter 7 discharge within the last 6 years or completed a Chapter 13 plan.

· You must not have had a bankruptcy filing dismissed for cause within the last 180 days.

· You must pass a bankruptcy means test.

· Granting you Chapter 7 bankruptcy protection and debtor relief is not in any way fundamentally unfair.

With offices in Santa Clara, Monterey, and Alameda County, Sagaria Law, P.C. handles Chapter 7, Chapter 13, and other bankruptcy-related matters. Whether you are an individual or a company in need of legal representation or advice related to bankruptcy, contact Sagaria Law, P.C. for a free consultation, and one of our attorneys can help you.

SLO Spa, Laser Center File For Bankruptcy, Sanluisobispo.com, October 27, 2006

Chapter 7, Personal Bankruptcy FAQ, Creditinfocenter.com

An Overview Of Chapter 7 Bankruptcy, Nolo.com

Related Web Resource:

California Chapter 7 Bankruptcy Information, California Bankruptcy.info