The exact process of a Chapter 13 Bankruptcy varies from case to case, but here are the general steps that are followed:
1. Initial Consultation
The first step in the process is to have you in our office for a free consultation with one of our attorneys. At this point we will review your assets, debts, income and expenses make sure bankruptcy is the appropriate action given your unique circumstances. Before this consultation we will ask you to complete an online questionnaire and gather some financial documents.
2. Pull Credit Reports
If you decide that you would like to retain our law firm, the first step is to pull your credit report from all three bureaus. This data will be the foundation of your “creditor list.” We will then review your credit report together and determine whether we need to add additional creditors not listed on your credit reports. Pulling your credit report will take approximately three minutes and we will cover the expense for you.
3. Online Credit Counseling Course
Before we can file, you will need to complete and online credit counseling course. The course will take your approximately one hour and we will pay the registration fee for you.
4. Review Draft of Petition
We will then draft your Chapter 13 Bankruptcy petition and give you a copy for your review. We will need you to look over the petition in its entirety to make sure all assets, debts, income, expenses and statements regarding your finances are true and accurate to the best of your knowledge and belief.
5. Review, Sign & File
Once the draft looks correct, we will ask you to come back into the office to review the entire petition with Attorney Travis T. Russell. We will go through your petition page by page, confirming its contents and what it means to your case. Once you confirm that everything is 100% accurate, we will sign & file your bankruptcy petition. At the time of filing, the automatic stay goes into effect.
6. Make Payments to Your Trustee
Your first payment to your trustee will be due 30-days after your case is filed. Your exact payment amount will be calculated based on many factors, such as income, tax obligations, mortgage arrears, etc.
7. 341 Hearing (Meeting of Creditors)
Approximately 30-40 days after filing we will have to attend a 341-Hearing, also known as the Meeting of Creditors. We will be scheduled for an hour block, but our hearing will only take about 5-10 minutes. The main focus of this hearing will be looking at what you own and what it’s worth. This hearing is very informal and is conducted by a Trustee, not a Judge.
8. Online Debtors Education Course
Just like the first credit counseling course, you will need to take another online course. This course will take approximately two hours and is prepaid by us.
9. Annual Tax Return and Budget Review
Every year will will need to sit down to review your prior years tax returns. We do this to (1) see if your actual income was more or less than the projected in Sch I, then amend as necessary, and (2) see what your refund is going to be, and determine whether or not your will keep your tax refund.
10. Keep Us Informed of Any Changes in Your Financial Situation
Keep us informed of any increases or decreases in your income or expenses. These changes could result in a payment reduction or increase.
11. Discharge
As long as you follow all the steps listed above, you should receive your bankruptcy discharge 100 – 120 days after filing (step 5).