In 2013, there were an estimated 1,071,932 bankruptcy filings in the United States, and a total of 728,833 were Chapter 7 filings.
Although many believe that filing bankruptcy implies failure, for many people, overwhelming debt and circumstances outside of their control were the true culprits, and bankruptcy simply offered them a way to restructure their debt packages and pay them back on a realistic timeline.
But how, many prospective filers wonder, is one to actual make a filing? Since the process is rather long and involved (a Chapter 7 bankruptcy takes around six months to complete), many people choose to hire a bankruptcy lawyer to help make sure everything is in order for the process. Even if you plan to hire a bankruptcy attorney, take a look at the basic Chapter 7 bankruptcy timeline so you know what to expect:
Step One: Filer must complete a mandatory credit counseling course online or over the phone.
Step Two: Filer must submit official bankruptcy forms, listing all property assets and creditors, and also providing information about your financial transactions during the previous two years. Then, the filer must send the bankruptcy trustee a copy of the most recently filed income tax return.
Step Three: Around a month after your file, you will attend a creditors meeting. This is usually the only personal appearance you will have to make. At the meeting, you will have to answer questions the trustee might have about the information in your papers.
Step Four: You must attend mandatory budget counseling, and file a form saying that you have completed it (along with an official certificate of completion).
Step 5: You are required to remain in a holding pattern in which you do not operate a business or give away any property without the trustee’s permission until the court sends you a discharge of your debt.
This is just a basic overview of a Chapter 7 bankruptcy timeline. Be sure to educate yourself more fully on each individual step if need be and consult with a reputable expert about your bankruptcy case.
