
Many assume that declaring bankruptcy is a simple process that quickly results in the discharge of debt. While you can receive debt relief, this process isn’t as simple as many believe it to be. As such, if you are considering filing for Chapter 7 bankruptcy, familiarizing yourself with the steps in the filing process is critical to understanding what to expect. The following blog explores what you should know about filing and why working with an Orange County Chapter 7 bankruptcy lawyer is in your best interest.
What Is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy is an option for those in debt to discharge some of their financial obligations. This process relies on liquidating the assets to pay off debts to creditors. Typically, those with a considerable amount of unsecured debts, like credit card bills, medical expenses, or personal loan debt can benefit from this process.
As mentioned, your non-exempt assets will be liquidated or sold to pay off the debt owed to creditors. Common assets that can be seized include cash, antiques, collections, clothing, vehicles, and investment accounts, among other properties.
What Are the Steps in the Filing Process?
It’s important to understand the steps in the filing process to understand what to expect and ensure you meet the requirements for this process to be valid. Generally, the first step is to meet with an experienced attorney to help you through filing. While this is not a legal requirement, trying to file without representation can have drastic impacts, as you may make errors during this complicated process that can result in the dismissal of your case or legal action against you.
Once you have discussed your circumstances with an attorney, you’ll need to attend mandatory credit counseling. This is a requirement for all filers and must be completed with an approved agency. You are required to complete the course within 180 days of filing.
Once you have obtained your certificate of completion, you’ll need to file all necessary bankruptcy forms. This includes a complete inventory of your property, debts, and creditors, and financial information such as tax returns, pay stubs, and business documents.
After the court approves your bankruptcy, you must submit the forms to the trustee assigned to your case for verification. You will then attend the 341 meeting of creditors, which is a mandatory step, to answer questions about your case.
Finally, once have completed the steps, you’ll need to attend a budget counseling course within 60 days. Once you submit the certificate of completion, they will discharge the remaining eligible debt and close your case.
As you can see, this process is incredibly involved, which is why working with an experienced attorney is critical when filing. At the Law Offices of Michael D. Pinsky, P.C., we know this can be overwhelming. That’s why our team is committed to guiding you through these difficult times. When you need help, our firm is here. Contact us today to discuss your circumstances.