New York Chapter 7 Bankruptcy | New Jersey Chapter 7 Bankruptcy
Mandatory Credit Counseling – File Mandatory Documents – Mandatory meeting with the Trustee – Objections By Creditors and Trustee – Financial Management Course – Discharge – Post Bankruptcy – Contact Us
HOW CHAPTER 7 BANKRUPTCY WORKS
(Time from filing to discharge: usually 4-5 months)
1. Mandatory Credit Counseling
For cases filed after October 17, 2005, you must obtain a certificate from an approved credit counseling agency before you can file your case. The cost is approximately $50 and we will instruct you how to quickly do it online. A copy of any payment plan devised by the counseling service must also be filed with the court.
2. File Mandatory Documents
When the petition, which you have signed under penalty of perjury, is filed with the Court, you will be assigned a case number. When this happens, all collection actions by creditors will stop. This means your creditors cannot take further action to collect or recover on any debt you owe without first getting permission from the bankruptcy court (which is only granted for specific purposes). This injunction is called the “automatic stay”.
3. Mandatory meeting with the Trustee
This occurs about one month after your case is filed. It is often referred to as a meeting of creditors. It is a simple meeting and only lasts a couple of minutes per debtor.
The Trustee is an independent person appointed automatically in all Chapter 7 cases by the United States Trustee’s Office (an administrative branch of the U.S. Department of Justice). The Trustee’s role is to liquidate any non-exempt assets you have. The Trustee then distributes those funds to your creditors according to their statutory priority in the bankruptcy code. The Trustee can also object to the granting of discharge in your case if he/she believes your case was not filed in good faith or if you have committed fraud in connection with your petition and schedules.
4. Objections By Creditors and Trustee
Your creditors have until 60 days after the date first set for your meeting with the Trustee to file a complaint objecting to the discharge of their debt , or to your entire discharge . Grounds for doing this include fraud (such as incurring charges on a credit card that you did not intend or have the reasonable ability to repay at the time they were made), false statements on a credit application, fraud while acting in a fiduciary capacity, willful or malicious injury to a person or property of a person, and certain others. Creditors can seek an extension of time to file their complaint, but as long as they received notice of your bankruptcy case, they must either file their complaint, or a motion requesting an extension prior to the expiration of the 60-day period.
In most cases no objections are filed. However, if a creditor does file a complaint, there will be a trial. You will need to consult a good bankruptcy attorney at that point to decide whether you wish to defend the action, settle it, or just let it go to default judgment. Usually, the matter can be settled or even pre-empted.
The Trustee has until 30 days after the date first set for your meeting with him/her to file an objection to any exemptions you have claimed. Again, this is rare, but it can happen depending on the specific exemptions you need to use in your case.
5. Financial Management Course
For cases filed after 10/17/05, you are required to complete a financial management course before receiving your discharge. In Chapter 7 cases, you must have completed this course and submitted the certificate of completion to the court no later than 45 days after the date first set for your meeting with the Trustee. If you fail to do this, you will not get a discharge. This course can be done at William Z Schneider & Associates New York or New Jersey bankruptcy locations or over the internet or by phone
6. Discharge
If you are properly represented by a qualified bankruptcy attorney and nobody objects to your discharge within the 60 day period referenced above, and you have completed all the other requirements, then you will automatically get your Notice of Discharge in the mail shortly thereafter (usually within 4-6 weeks after expiration of the 60-day period). This notice basically provides that you are discharged from all dischargeable debts. Certain debts are not dischargeable, such as child support, alimony, certain taxes, student loans, and some others. As qualified bankruptcy attorneys, we will consult with you regarding what is dischargeable or not.
The discharge applies to all dischargeable debt which you scheduled in your bankruptcy papers and which received notice of your bankruptcy filing. If a creditor did not receive notice, they may be able to reopen your case and still challenge the discharge of their debt later on. Whether they can do this depends on a number of factors, including what the basis of their discharge objection is, whether assets were distributed in your case, and a few others.
7. Post Bankruptcy
Unlike most other bankruptcy law “mills”, William Z Schneider & Associates will work with you after your discharge to solidify your credit and guide on the path to financial health.
8. Contact Us
Contact a New York New Jersey bankruptcy attorney today. With three convenient locations covering Manhattan, Brooklyn, and New Jersey, you will find a bankruptcy attorney that will work one-on-one to discharge your debt have you chart a new path, debt free.