Thursday, 3 October 2019

How To Prepare To File Chapter 7 Bankruptcy

Today I want to talk to you about what you need to know, and what you have to have ready, in order to meet with your attorney to file a chapter 7 bankruptcy case. A chapter 7 case is a straight discharge where you are going to be discharged from your unsecured debt. Certain things are not capable of being discharged. However, in general in chapter 7 if you are eligible and there is a means test that you have to pass based upon your income and your expenses, to see if you are eligible to file a chapter 7. If you are eligible, you have an attorney ready, then you need to be prepared to pay the filing fee and pay your attorney, usually, the attorney will do this on a flat fee basis for the basic filing and attendance at the 341 meetings.

  1. You will need to have a list of your real estate
  2. A list of your major personal property
  3. A list of all of your creditors

In bankruptcy the person filing or people if it's a married couple you can file one case together, you are called the "debtor" and the people that you owe money to are the "creditors". Creditors include, 

  1. Installment loans
  2. Car loans, 
  3. Mortgage
  4. Credit cards
  5. Who you borrowed money from
  6. Any cash advance that you have made on credit cards
  7. Any loans against 401k plans
  8. Any private loans
  9. Also, contract payables are included in there,
  10. It also includes child support which is not dischargeable but you need to disclose everything.
  11. Alimony payments
  12. Property settlements that have not been paid.
  13. Your taxing authorities.
  14. Your student loans
  15. Business debt

You want to have all of that identified listed out, don't miss anybody. You want to list out all of your debts and have that ready. Then you are going to need to know the value of your real estate if it's your residence.

  1. The value of your vehicles
  2. The value of any life insurance and cash advance that you have
  3. Any equity in any whole life.
  4. Deposits that you have paid
  5. Maybe your landlord
  6. If you have equity in a country club membership
  7. Stocks and bonds
  8. Everything.

Everything that you owe and everything that you own, you need to have it listed out, it will make it a lot easier. That is all the information that you will have, then you should also be able to tell your attorney the last big payments that you made, if you made any large payments to any creditors, maybe you were trying to get caught up but something happened, you got sick or you lost your job or someone in the family becomes ill. You need to be able to tell them about major payments that were made in the 90 days before you are going to file. Then you also need to tell them if you have any vehicular homicide charges you if you have any fraud judgments against you. You need to have the creditor and their attorney and the case number and where the case was filed, all of this information is going to be put into some schedules. And also will help with answering a statement of financial affairs.

You will also need to know who your accountant was, that prepare your last tax returns, if you own any small business interests, you will need to know that, if you have debts with other people where both of you borrowed or you co-sign for someone or they cosign for you, you will need to know that.

  • All of this information is what you are going to need to take into your attorney and then depending upon where you live there are certain exemptions, the things that you can keep even though you go through bankruptcy.

  • Certain things that you keep there are going to be certain possible arrangements that you can make to protect property that you might lose if you don't protect it before you file a bankruptcy. But your attorney can tell you based upon where you live and what property owners, what things you should or shouldn't do.

Then there are certain situations where there is a property that is not included in the bankruptcy and you need to be very clear with your attorney, get it in writing if necessary what those items are. When is the bankruptcy going to be filed because you are going to have to physically sign these documents to verify under penalty of perjury that they are correct, and you need to be prepared to swear to that? Then you want to know when the bankruptcy is going to be filed and what you can and can't do with your money, with your property, right before the bankruptcy filed. And right after. Ask those questions of your attorney, you need all of the information, you need to have the money to be able to pay for the filing fee and your attorney.

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