Your package includes all forms needed for filing Chapter 7 or 13 bankruptcy, information and important resources. Bankruptcy is complex and with the new laws that went into effect more difficult to handle without an attorney.
How to File for Bankruptcy and Save Your Assets
Filing for bankruptcy can be accomplished without a bankruptcy lawyer and paying expensive legal fees. A voluntary petition for bankruptcy, if granted and the debt discharged, allows the debtor to get a fresh start and clear the slate with creditors. In some cases a reorganization and payment plan is agreed on. However, in a no asset case, filing bankruptcy can often get the debt discharged.
The bankruptcy automatic stay is imposed upon your creditors when you file for bankruptcy. Creditors can't contact you for repayment of the debt once you file for bankruptcy and up until the debt is discharged.
Bankruptcy Codes and Bankruptcy Laws
According to the bankruptcy rules and laws, a person or business representative can file bankruptcy under Chapter 5, Chapter 7, Chapter 11, Chapter 9, and Chapter 13 of the U.S. Bankruptcy Code. The automatic stay applies in all cases once the bankruptcy voluntary petition is filed. The most commonly used chapter filings are discussed below:
- Chapter 7 - Chapter 7 bankruptcy is the most popular avenue for filing a personal bankruptcy or no asset case bankruptcy. In Chapter 7 bankruptcy, the debtor lacks the income or assets to repay creditors. The aim in Chapter 7 bankruptcy is to have debts discharged, so a repayment plan or reorganization plan isn't required. Because consumer debt is often involved, the automatic stay imposed when the bankruptcy petition is filed relieves debtors from harassment by creditors.
- Chapter 11 - A Chapter 11 bankruptcy is designed to prevent insolvency by allowing the debtor to reorganize and refinance. It may be used for personal bankruptcy, but is more commonly used by a bankrupt business. The cost and complexity of Chapter 11 bankruptcy makes it unattractive for filing bankruptcy as an individual. A reorganization plan must be confirmed by the bankruptcy trustee and court.
- Chapter 13 - Chapter 13 bankruptcy is used to file personal bankruptcy by a debtor who can repay creditors. A repayment plan is filed in a Chapter 13 bankruptcy, allowing creditors to receive partial payments according to the payment schedule in the plan approved by the bankruptcy trustee and court. A Chapter 13 plan is sometimes referred to as wage earner plan. After confirmation of the plan by the bankruptcy trustee and court, the debtor makes installment payments to creditors.
How to File Bankruptcy
If you're asking yourself "how do I file bankruptcy", US Legal Forms offers voluntary bankruptcy form packages for each state, designed by lawyers. There are simple step-by-step instructions, a how to bankruptcy guide, and all the bankruptcy forms you need in our bankruptcy form packages. How to file bankruptcy will depend on the facts in your case, such as whether you are seeking a personal bankruptcy or a Chapter 11, Chapter 13, or Chapter 7 petition. Our bankruptcy forms packages contain all the forms you need to file a bankruptcy petition, from the cover sheet to all of the bankruptcy schedules and official court forms you need to complete the process. The debtor must complete all court forms, starting with the cover sheet. A debtor must list assets and income and fill out a list of creditors matrix. A Credit Counseling Briefing and the Debtor Education Course are required for everyone filing a personal bankruptcy. In the bankruptcy package offered by US Legal Forms, the bankruptcy forms include the required documents needed to take the Means Test. The Means Test is required to prove income and asset eligibility for filing a personal bankruptcy. A certificate of non-attorney preparation must be submitted when you have someone other than a bankruptcy lawyer prepare the forms. The non-attorney preparer must also sign a statement and disclosure certificate. If you are unsure which bankruptcy forms you need for filing bankruptcy, a bankruptcy forms package contains all the bankruptcy court forms you need at a significant saving over purchase of individual bankruptcy forms.
Who Can File Bankruptcy
An individual can file personal bankruptcy, or a partnership or corporation may also file voluntary bankruptcy. Bankruptcy must not have been filed in the previous seven years. A non-attorney bankruptcy preparer may be used, a bankruptcy lawyer isn't required. Individuals seeking a discharge of debts in bankruptcy must pass the Means Test and complete a debtor education and credit counseling course. The Means Test is used to prove to the bankruptcy court that the debtor has insufficient assets and income to repay creditors.
If filing a Chapter 11 bankruptcy or Chapter 13 bankruptcy, a Chapter 13 plan of repayment or Chapter 11 reorganization plan must be prepared. According to the bankruptcy code and bankruptcy rules, the repayment or reorganization plan must be approved by the bankruptcy court.
Why Bankruptcy May be Denied
If you're wondering about bankruptcy and how to file bankruptcy, you should consider the chances your voluntary petition for discharge in bankruptcy will be denied. If you are filing a voluntary petition for personal bankruptcy, your petition for discharge under Chapter 7 may be denied if you fail to pass the Means Test. Under the bankruptcy code and bankruptcy rules, an individual filing a voluntary Chapter 7 bankruptcy must pass the Means Test to prove inability to repay creditors. Failing to complete the debtor education and creditor counseling courses may also cause a voluntary petition to be denied. Also, failure to complete the court forms accurately and honestly can cause your bankruptcy petition to be denied by the bankruptcy court. For example, leaving a creditor off of the creditors matrix can cause your bankruptcy petition for discharge to be denied. All courts forms, even the cover sheet, must be completed and conform to the bankruptcy rules. If you are filing a Chapter 11 or Chapter 13 plan, the trustee and bankruptcy court must find it's in the creditors' best interests in order to approve your bankruptcy petition.
The Bankruptcy Code allows individuals and businesses to file a voluntary petition and seek a fresh start. US Legal Forms offers professionally prepared bankruptcy form packages that have all the court forms you need to file a voluntary petition for bankruptcy in your state. How to file for bankruptcy is also explained in a helpful bankruptcy guide.
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.
Do I need a bankruptcy lawyer?
A bankruptcy lawyer isn't necessary to file a voluntary petition for bankruptcy. If you're wondering about bankruptcy and how to file for bankruptcy, the bankruptcy forms package offered by US Legal Forms not only contains all the bankruptcy court forms you need, but also includes easy to follow instructions and a helpful guide on filing bankruptcy. It's not necessary to know everything a bankruptcy lawyer knows about bankruptcy in order to file a voluntary petition for personal bankruptcy. Therefore, you can file bankruptcy without need for a bankruptcy lawyer and expensive legal fees.
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.