How do I file bankruptcy?
There is no need to hire an expensive bankruptcy lawyer in order to file bankruptcy. US Legal Forms offers a bankruptcy forms package professionally designed by lawyers for each state. Our bankruptcy form packages include all the bankruptcy court forms you need for filing bankruptcy, along with step-by-step instructions and a helpful how to bankruptcy guide.
What is the difference between Chapter 7 bankruptcy and Chapter 13 bankruptcy?
For an individual filing a voluntary petition for personal bankruptcy, the difference is the ability to repay creditors. In a Chapter 7 no asset case, if the debtor passes the Means Test, the debts may be discharged and the creditors barred from further seeking collection. If the debtor is unable to pass the Means Test and can repay creditors, a Chapter 13 plan, also called a wage earner plan, will be formulated in a Chapter 13 bankruptcy to repay creditors.
What are some of the 2005 changes made to the U.S. Bankruptcy Code?
Under the 2005 changes made to the Bankruptcy Code and bankruptcy rules, individuals filing a voluntary petition for bankruptcy and seeking a discharge under Chapter 7 must pass the Means Test. The Means Test is designed to prove the debtor has a no asset case and unable to repay creditors, such as under a Chapter 13 plan. Other significant changes included the requirement to complete a debtor education and credit counseling course. Also, new bankruptcy rules apply to a non-attorney preparer regarding disclosures to clients and completion of a certificate of non-attorney preparer.
What is the creditors matrix?
The creditors matrix is a listing of creditors and debts which is used to compare debts to income and assets in order to determine ability to repay debts. A failure to list all creditors on the creditors matrix can cause the court to deny your bankruptcy petition.
How does the automatic stay protect debtors?
When a bankruptcy petition is filed, the automatic stay under the U.S. Bankruptcy Code prevents debtors from further collection efforts. The automatic stay protects the debtor from creditor lawsuits, repossession, foreclosure, or other collection activity. The automatic stay under bankruptcy laws will protect the debtor until the bankruptcy court lifts the stay, grants a discharge, or the property is no longer in possession.
What is Chapter 11 bankruptcy?
Chapter 11 bankruptcy is typically filed by a business debtor. The cost and complexity of Chapter 11 bankruptcy laws makes it undesirable for most individual debtors. Under Chapter 11 bankruptcy, a plan of reorganization is prepared and the trustee and bankruptcy court must approve the plan as being in the best interest of creditors.
What is a Chapter 13 plan?
A Chapter 13 plan is also referred to as a wage earner's plan. It is for individuals who have regular income and can repay their debts. Therefore, these debtors are unable to pass the Means Test and qualify for a discharge under Chapter 7 bankruptcy filing. Under a Chapter 13 plan, the debtor filing for personal bankruptcy agrees to pay all or part of the debts owed to creditors. According to bankruptcy laws, the Chapter 13 plan must be filed with the bankruptcy petition or no later than 14 days after filing the petition. The bankruptcy court must approve the plan. The debtor will make plan payments to the trustee, and it is the trustee who handles making payment to creditors. The debtor must begin to make Chapter 13 plan payments no later than 30 days after filing the bankruptcy petition, even if it the bankruptcy court hasn't approved the Chapter 13 plan yet.
What is the advantage of filing a Chapter 13 bankruptcy petition?
One of the main advantages of filing a petition for Chapter 13 bankruptcy is that it can allow the debtor to keep property that is collateral for secured debt. For example, it can help a debtor save a home from foreclosure. When the bankruptcy petition is filed, foreclosure proceedings are stopped. The debtor can save the property as long as the debtor cures delinquent payments and makes mortgage payments that come due while the bankruptcy case is pending.
What is debtor education?
Under the U.S. Bankruptcy Code, there is a requirement under bankruptcy laws that debtors filing a voluntary petition for personal bankruptcy complete a debtor education course within 180 days of filing a bankruptcy petition. The debtor education course was a new requirement for how to file bankruptcy that was added to the bankruptcy laws in the 2005 reforms of the Bankruptcy Code.
Can bankruptcy prevent foreclosure?
Yes, if you have regular income, it's possible to file a voluntary petition for personal bankruptcy under Chapter 13 along with a Chapter 13 plan of repayment. When the bankruptcy petition is filed, the automatic stay takes effect under bankruptcy laws and the creditors must stop foreclosure action. If the debtor can pay the delinquent payments and continue making the mortgage payments as they come due, the property can be saved from foreclosure.