About Requirements For Bankruptcy

Feb 20th, 2014 | By | Category: Debt

Bankruptcy rules and regulations have become increasingly strict and more rigid with the recent sweeping shifts in the bankruptcy laws in recent years. It used to be that one could declare bankruptcy every year or so with no consequences but that isn’t the case any more. In fact, if your bankruptcy case isn’t submitted to the federal judge in the right light, you may not even get approved to file for bankruptcy.

That’s right, you now need to be approved to file. This is exactly why it’s more important now than ever to not seek to do it yourself. The complexities in the laws require the knowledge of someone like a good bankruptcy lawyer who work with this on a periodic basis, because if not shown in the right light, you could be even more hosed than you’re now.

Here are some basic steps to follow if you choose to file for bankruptcy: 1. Yes, technically you may file for bankruptcy on your own, but the new legislation passed in 2005 make it almost impossible to do without hiring a good bankruptcy attorney. Once you retain an attorney, all debt collection calls and inquiries may be addressed to him or her, thus alleviating some of your burden right away. Not only can bankruptcy lawyers protect you from harassment, but they’ll make you know your rights, and inform you of the laws and requirements surrounding the nature of bankruptcy for which you may file. 2. Since 2005, when the bankruptcy laws changed, the process is a lot more involved. For instance, in either form of personal bankruptcy case you’re required to undergo pre-bankruptcy consumer credit counseling. This must be done within the 180 days before your filing. Your lawyer will normally have a list of counselors they use for such purposes and it can be made on-line if you choose. 3. Chapter 7? Chapter 11? Chapter 13? Which one is right for you and your situation? Your bankruptcy attorney will assess your case and will advise you under the best route for you to take as to the type of bankruptcy to choose.

Continuing This Conversation About Requirements For Bankruptcy

If your annual income is over a certain amount, you may not be entitled to file a Chapter 7. You will also discuss fees and means of payment during your first meeting with an attorney. The attorney will give you a checklist of documents and information they require from you, with a view to proceed. For example, tax returns, bank statements, pay stubs, copies of your deed, mortgage, car tile, a list of your debts and assets, etc. At some point in the process, after your petition is filed by your attorney, a meeting of creditors will be made up. This is to make sure that the data you have given is honest and legit, that you understand everything that is participating in the bankruptcy process, and that you understand the implications of agreeing to file for bankruptcy. This meeting of creditors is conducted and presided over by a bankruptcy trustee. The trustee will review your case and determine an outcome. Any final instructions or additional requirements of you’ll be conveyed to you at this time. There are many variables that can enter into play within the bankruptcy process. It is very important to get a good bankruptcy attorney representing your interests.

Chapter 7 and Chapter 13 bankruptcy rules have also become stricter. The rules differ from state to state. However, the basic tenets are consistent. The standards now require credit counseling, stringent mathematical formulas in order to identify the form of bankruptcy that can be implemented for, and stricter rules as to how money will be given back. One of the bankruptcy rules is the demand for credit counseling and it must be made with a state-approved credit counselor. This is to assist the debtor determine if bankruptcy is the only solution, or if there may be a more efficient means of eliminating personal debt. Proof of attendance will be necessary prior to filing for Chapter 7 or Chapter 13.

Any plan for repayment created by the counseling agency must be presented to the court at the time of filing. Filing must be carried out in the debtor¬Ěs state of residence. This is important because states can determine exemptions. Moving to another state to avail oneself of attractive exemptions isn’t acceptable. One has to have lived in the state of residence for two years before filing for bankruptcy.

The determination as to whether to file for Chapter 7 (elimination) or Chapter 13 (a repayment plan) is no longer up to the individual. Bankruptcy rules prevent individuals with too high an income from filing for Chapter 7. The determination of eligibility is according to a mathematical formula that compares the person¬Ěs monthly household income to the median income for the average family of the same size. Those with a lesser income may file for Chapter 7.

Those making more than the median may then take the means test. This determines disposable income after subtracting allowable expenses. Those below the mean may still qualify. This is based on if there remains too little disposable income after the subtraction of other allowable expenses. The bankruptcy rules for Chapter 7 allow for the performance or elimination of unsecured loans such as credit card debt. Items such as back child support and alimony won’t be discharged. Student loans are not likely to be exempt. Property from secured loans may or may not necessarily be exempt and could be seized and liquidated in the interest of creditors.

The bankruptcy rules allow for a plan of repayment for debts owed under Chapter 13. Individuals with incomes above the median and the mean may be able to claim this, While some of the debt may be discharged, a repayment plan is filed that included a three to five year plan of monthly payment, including some or all of their unsecured debt. The repayment plan is based on disposable income after the subtraction of allowed expenses. Allowed expenses aren’t necessarily the real cost of expenses and are often less. This means that after filing bankruptcy, the debtor will generally be getting by on less. The positive side of such is the debtor doesn’t lose The debtor doesn’t lose personal property under the plan.

Chapter 13 bankruptcy-is a type of bankruptcy that permits the reorganization of debt. Debtors may propose a 3-5 year payment plan under court supervision and protection under Chapter 13. During this time you’re protected from creditors continuing or starting collection efforts against you. If you’re committed to repaying your debts, but require a more rational and attainable payment plan, than Chapter 13 may be for you.

The best way to figure out which bankruptcy rules you qualify for is to sit and talk with a bankruptcy attorney. They will know and understand all the rules and the loop holes. Make a list of issues and concerns you have and make sure they answer those questions. Remember this is your life and your credit. Make sure you’re protected.

Bankruptcy requirements?
What are the residency requirements of Arizona in order to declare bankruptcy there?

  • You need to reside in the district for the majority of the preceding 180 days prior to filing to file a case in Arizona. However, it takes significantly longer to qualify for Arizona's state exemptions – at least 2 years. Nearly all consumer bankruptcy attorneys offer free consultations. Take advantage of this to meet with one and get advice based on all of the details of your particular situation. You can find a referral at NACBA.org (National Association of Consumer Bankruptcy Attorneys).

  • I don't think you need any requirements. I would suggest you to hire a lawyer to file bankruptcy. It will probably cost about $500-$1000. You maybe allow to keep your car, your house and saving in your bank account. The whole process will take about a month and once you rec a discharge from the court, you won't be responsible to your debts. The discharge paper should keep for 10 years. Your credit history of bk will keep for 10 years. The best adv is to keep at least one credit card, it can help you rebuild your credit, but must pay on time thereafter. Good luck!

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