The majority of Chapter 7 Bankruptcy cases are rather simple and routine. The entire bankruptcy process takes approximately 4 to 4 1/2 months.
Once the petition is filed, the court will send out an official notice informing your creditors that you have filed bankruptcy and appointining a trustee. This notice will also schedule a meeting of creditors, which is held approximately 30 days after you file. You are required to attend the meeting. These meetings are held on the hour between 9:00 a.m. and 4:00 p.m. They are quite brief and last only about five to ten minutes. There are about eight to ten cases per hour, so you generally will not be there more than an hour. Occasionally, a person may have a conflict and so it would be somewhat difficult to attend the meeting. There is no need to worrry, as the court permits everyone to miss at least one meeting and allows the Trustee to reschedule a new one. Also, an option available to a person who suffers from an illness or some other exceptional hardship is to file a motion and to be excused from attending the meeting of creditors and to participate by telephone.
As I previously stated, a Chapter 7 Bankruptcy Trustee is appointed to your case. At least 7 days prior to your meeting of creditors, there are certain types of documentation that you are required to submit to the trustee. Such items include copies of your tax returns for the past two years and paystubs for the past 3 months or current income information. The purpose of the meeting is to obtain additional information about your case. At the meeting, the trustee will ask the debtor a series of questions to verify the accuracy of the information on the bankruptcy petition, particularly regarding the debtor's assets and liabilities. The questions are rather routine, but include the following:
Please show me your social security number (You will need your original social security card or some other type of original document that shows you social security number, such as an original W-2, medicare card, etc.)
Please show me your picutre I.D. (This can be your driver's license or State photo identification or some other information to establish your identity.)
Did you sign the petition, schedules, statements and related documents and is the signature your own? Did you read the petition, schedules, statements and related documents before you signed them.
Are you personally familiar with the information contained in the petition? Is the information contained in the petition and related documents true and correct? Are there any errors or omissions?
Are all of your assets identified on the schedules? Have you listed all of your creditors on the schedules?
Have you previously filed bankruptcy? (In order to be eligible for a Chapter 7 Bankruptcy discharge, a petition can only be filed every eight years. Otherwise, it will be necessary to file a Chapter 13 Bankruptcy).
What is the address of your current employer? (This information is also required to be listed on Schedules I.)
Is the tax return you provided a true and correct copy of the most recent tax return you filed? Are all tax returns that are due been filed? (If you are not required to file tax returns, then you should provide an affidavit to that effect and provide it to the Trustee at or prior to the meeting.)
Do you have a domestic support obligation? (This is normally an obligation in the nature of child support, spousal support or alimony. If you do have such an obligation, it will be necessary for you to provide the Trustee with the name and address of the person to whom you pay support.)
Do you expect to receive anything of value within the next six months? (This would include such things as an inheritance, gambling winnings or any other thing of value).
Does anyone owe you any money? (If you are owed money, then the question comes down to whether it is collectible.)
Do you have a claim or potential claim against anyone? (This would include such items as a personal injury claim or any other lawsuit.)
Do you own or have any interest in any real estate? (If you have a home you will need to substantiate why you think it is worth the amount that you listed on the schedules and how you arrived at that amount.)
Have you made a transfer of any real or personal property? (The Bankruptcy Code prohibits the transfer of any property not in the ordinary course of business. This means that you are not allowed to transfer any property to someone for less tha the fair market value, such as for $1.00 or a nominal amount shortly before filing bankruptcy. The Bankruptcy Code restricts the transfer within two years prior to filing and State law restrict the filing within five years.)
Have you read the Bankruptcy Information Sheet? (This is an information sheet that provides various information about the types of bankruptcy, the bankruptcy discharge and the entering into a reaffirmation agreement. Normally, this will be mailed to you prior to the meeting or you can obtain a copy of it at the meeting of creditors.)
What was the reason for you filing bankruptcy? (There is no right or wrong answer to this question. Almost any answer is satisfactory. You might want to say that your income was reduced due to a job loss, you overextended yourself on your financial obligations, you had a serious medical condition. etc.)
These are probably the majority of the questions that will be asked. However, based upon a person's responses, the Trustee may want to ask some additional questions. Also, the Trustee may want to see some additional documentation to support some of the figures that you have listed on your schedules. The meeting may be continued to another date to give you the opportunity to get this information. Assuming that you are able to provide this information prior to the meeting, then there is generally no need to attend this newly scheduled meeting. After the Trustee has reviewed your information and if he or she has detertmined that there are some inconsistencies, then an amendment to the schedules can be filed that will generally cure or resolve the problem.
The Trustee is normally the only person to question you during the meeting. However, any one of your creditors are free to show up and examine you. This rarely occurs. If anyone does show, all they can do is ask you some questions. From their standpoint, the meeting is a time engage in discovery and determine your ability to pay anything toward their debt. In order for them to do anything some action has to be filed in court. This is seldom done, so it is not likely that you will be required to appear in court.
Upon the conclusion of the meeting of creditors, the trustee can either close out the meeting or continue it to another date, as was previously discussed. Most of the time the meetings are closed out and no further proceedings are required. If it is determined that the debtor is unable to exempt his or her assets or has more than nominal assets, then it is required that such assets be turned over to the Chapter7 Trustee, who will then liquidate them and turnover any proceed received to pay creditors.
The scheduling and the rules regarding the meeting of creditors are about the same for a Chapter 13 Bankruptcy. These meeting are also on the hour and may last about ten to fifteen minutes. Unlike a Chapter 7 Bankruptcy, these meeting are usually held in a closed room, with just you and your attorney present. On occasion, a representative from your mortgage company, car lender or taxing authority may also be present. The Chapter 13 Trustee will examine you to determine whether the Chapter 13 Plan that you have proposed is feasible and whether you have the ability to make plan payments and whether there are any grounds to obect to the plan. Upon the conclusion of the meeting, the trustee will normally enter an interim distribution order, so that your creditors can start getting paid. A date for a conciliation is provided that may be four months later. It is not necessary for you to attend this conciliation. At this meeting, your attorney will normally get your Chapter 13 Plan confirmed on a final basis.
If you are interested in filing for bankruptcy or you simply have some questions about filing, then call Pittsburgh Bankruptcy Attorney Rodney Shepherd at 412 471-9670 or fill out our content infromation form. You will be immediately contacted and scheduled for a free consultation.