The Bankruptcy Process

The bankruptcy process is governed by Federal law and affords individuals who have fallen on hard times a fresh financial start. If you have done any research on the subject of bankruptcy you have read terms like the “Means Test,” “exemptions” and “discharge” and may be overwhelmed by the terminology and the process. Matthew C. Bothwell, P.A. is here to help. While the bankruptcy process varies slightly depending on which type of bankruptcy you file (chapter 7 or chapter 13), the reality is that most of the hard work is done well before you or your attorney ever enters the courtroom.

Step One: The Initial Interview

At Matthew C. Bothwell, P.A. every bankruptcy case begins with a free of charge initial interview during which you sit down with an actual lawyer and discuss why you feel bankruptcy may be an option. The purpose of this free consultation is to answer your questions, determine if bankruptcy is best for you and explore alternative solutions to your financial problems. This free initial consultation also allows us to get to know you, lets you ask us any questions you may have about bankruptcy or any other legal matter and helps you determine which type of bankruptcy you may need to file.

Step Two: Document Production

If bankruptcy is your best option and you have chosen to move forward, the next step is to complete an intake questionnaire and put together documents that will be necessary to complete your bankruptcy schedules. Completing the questionnaire and providing us documents is, without a doubt, the most important part of your bankruptcy case.

Step Three: Petition Preparation and Credit Counseling

When you have completed the bankruptcy questionnaire and we have your document production, we will schedule short conference in our office or by telephone to review your bankruptcy paperwork and answer any questions you may have.   We will also pull your credit report and provide you a copy if you wish. After we review your questionnaire and document production we will prepare your bankruptcy schedules. A typical bankruptcy package filed with the court in chapter 7 or chapter 13 is 50 to 60 pages long. Bankruptcy schedules include a list of all of your assets, debts, creditors, your current monthly income, your current monthly expenses and a questionnaire that identifies other possible sources of income or distributions of your property.

Before we can file your bankruptcy petition you are required to complete a credit counseling course. This is can be done online and by making a single phone call, and typically takes less than an hour to complete. Of course we will assist you in taking this course.

Step Four: Final Review, Signing and Filing

When your petition and schedules are completed we will schedule a final review with you to review all of the documents you will be filing with the court. At this meeting we will walk you through each and every page of your bankruptcy petition and ensure that you understand what we are filing. If everything is right you will sign the schedules and declare to the court, under oath, that everything is correct to the best of your knowledge. After that, your bankruptcy is filed electronically.

When you file Chapter 13 you must file your initial proposed chapter 13 plan with or shortly after filing your petition. Your chapter 13 plan will propose an amount of money you will pay the trustee each month and advise how the trustee should pay your creditors. Once your plan is filed you must make an initial payment to the trustee in an amount equal to that proposed by your plan within 30 days of filing the plan. You will continue to pay the trustee this amount each month during your chapter 13 bankruptcy and until the plan is completed and you receive your discharge.

Step Five: Trustee Document Production and Phone Conference

Just a few days after filing bankruptcy the court will issue a notice advising you and your creditors of the time and date of your Meeting of Creditors. More information on your meeting of creditors is below. About 10 days or so after filing you and I will both receive a letter from your chapter 7 trustee requesting certain documents and information and scheduling a phone conference. Once our office receives the trustee’s letter we review your file and determine if we need any additional documents from you to comply with the trustee’s request. If we have what the trustee needs we will respond to their request on your behalf. If other documents are required we will ask that you send them to us so we can get them to the trustee.

Trustees typically ask that we provide the requested documents a few days before a phone conference (in a chapter 7 bankruptcy). The telephone conference is between you, our office and the trustee and you can come to our office or we can set-up a conference call. At the telephone conference the trustee will ask you questions concerning your assets, any money owed to you, money transferred by you to another and ask any questions they may have regarding your bankruptcy petition. The questions posed at the telephone conference closely mimic those that will be asked at your meeting of creditors and the purpose of the phone conference is to make your Meeting of Creditor go quickly and smoothly.

Step Six: Meeting of Creditors, Financial Management

In a typical Chapter 7 or Chapter 13 bankruptcy you will not be required to appear in court and your only “in person” appearance will be at your Meeting of Creditors. The Meeting of Creditors is an opportunity for the bankruptcy trustee and your creditors to ask you questions about your assets and debts under oath. Although the Meeting of Creditors is held at the courthouse, it does not take place in a courtroom and is a relatively informal process. It is very rare for your creditors to appear at this meeting and you will generally only be questioned by the trustee.

A Meeting of Creditors typically last less than 5 minute and closely mimics your phone conference with the trustee. We will prepare you in detail for both your phone conference and your Meeting of Creditors, be present at both with you, provide you sample questions that may be asked by the trustee and answer any questions you may have before the meeting.

Before you can receive your bankruptcy discharge you will need to complete a financial management course that, again, you can take online.

Step Seven: Chapter 7 Buybacks and Chapter 13 Plan

In chapter 7 bankruptcy if it is determined that you have assets or property valued in excess of your bankruptcy exemptions the trustee will either require that those assets be surrendered for sale or that you pay the trustee the value of your non-exempt property. Unfortunately, in the Middle District of Florida trustees are no longer accepting payment plans for buyback but there are companies that will lend you money, if necessary, to help you keep your property.

If you have filed chapter 13 bankruptcy any issues or objections to your plan raised by the trustee are typically made known at your Meeting of Creditors and the trustee will file objections, if necessary, to your plan. If an objection is filed you can amend your plan to conform to the objection, challenge the trustee in court or resolve the matter directly with the chapter 13 trustee. It is very common for the trustee to object to prosed chapter 13 plans and to amend your plan at least once during the bankruptcy process. The court will allow several attempts to get it right before dismissing your case.

Step Eight: Bankruptcy Discharge

In a chapter 7 bankruptcy you will typically receive your discharge and your case will be closed four to six months after you file. The duration of your bankruptcy is largely dependent on whether yours is an asset or non-assets case.

In a chapter 13 bankruptcy you will receive your discharge after all payments are made in accordance with your proposed plan. This will be after 3 to 5 years of payments, depending on the nature of your chapter 13 plan.

For more information concerning the bankruptcy process please contact Jacksonville’s debt relief lawyer, Matthew C. Bothwell, Esq. We are here to help.