Before Filing Bankruptcy
Required Documents: While the following list is not exhaustive, in general I will need the following information from all clients:
Returning Documents to Keenan Law Offices:
We prefer that you email or fax (510-221-6057) documents back to us. You may also mail documents to any office location. Finally, you may drop off documents at any office location, however, be sure to make an appointment prior to dropping off any documents.
Credit Counseling Course (Pre-filing):
You may take any credit counseling course you like. We recommend www.debtorcc.org simply because the cost is low at $9.95 per household. You are free to look for a cheaper credit counseling course. The pre-filing course must be taken within 180 days of filing bankruptcy. Therefore, we recommend waiting to take the class until after you have provided all of the required documentation to our attorney. The credit counseling class is requirement to filing bankruptcy and takes about two hours to complete. Most courses are completed online.
After Filing Bankruptcy
One of the main benefits in filing bankruptcy is the automatic stay. The automatic stay is defined in section 362 of the US Bankruptcy Code. It is a court order that goes into effect upon the filing of your bankruptcy case. The automatic stay prevents your creditors from continuing or starting any further collection action against you. Therefore, it stops all lawsuits, garnishments, letters, and phone calls. However, for the automatic stay to effective, the creditor must have notice. If you have a creditor that continues to contact you after the bankruptcy is filed, please contact our office and we will notify the creditor of the automatic stay and the severe penalties that may be imposed for violating a Federal Law.
Relief from the Automatic Stay
Some creditors may be able to obtain relief from the automatic stay in order to pursue collection activity. Such creditors are normally car and mortgage lenders. The US Bankruptcy Code allows secured creditors (those lenders that have collateral at stake) to obtain relief from the bankruptcy stay when the collateral is at risk. There is often very little that can be done to oppose a motion for relief from stay if your car or mortgage payments are not current and there is no equity in the property. If a creditor files a motion for relief from stay in your case and you wish to keep the property that is secured by the loan, please call us at 510-556-1160 to discuss your options.
Debtor Education Course (Post-filing):
You may take any debtor education course you like. We recommend www.debtorcc.org simply because the cost is low at $9.95 per household. You are free to look for a debtor education course. If you fail to take the debtor education course, you will be denied a bankruptcy discharge. Therefore, we require that you take the debtor education course before the 341 meeting of creditors.
341 Meeting of Creditors:
Please remember to bring proof of your Social Security Number (SSN Card or W-2) and a picture ID.
At the meeting of creditors, we meet with the bankruptcy trustee to review your case. The trustee will ask you questions about the petition and the property we listed in your bankruptcy petition. The meeting generally takes about 5-10 minutes and is nothing to be scared about. Please refer our communication to you regarding the time and place of the 341 meeting.
Some debts are allowed to survive bankruptcy. If this is something you desire, then a reaffirmation agreement must be signed between you and the creditor. A bankruptcy legally breaks all contractual debt you have. The reaffirmation agreement puts together those broken contracts so that the debt survives the bankruptcy. Typically, these agreements are for car, home or any secured loan that you might have. We only suggest signing reaffirmation agreements if you actually have equity in the collateral securing the debt obligation.
Your Bankruptcy Discharge and Rebuilding Your Credit
In a chapter 7 bankruptcy, the court normally issues a grants a discharge pursuant to the US Bankruptcy Code Section 727. This is commonly referred to as a 727 discharge and occurs about 60 days after the initial meeting of creditors. A few days later, the case will be closed and the credit rebuilding process can begin.
In a chapter 13 bankruptcy, the discharge of debts occurs when the bankruptcy plan is completed. Therefore, if you do not complete the plan, a discharge of debts will not occur.
This process will be different for each person, but the important thing to remember is that to build credit you have to have credit. Therefore, it is a good idea to have some recurring payment reporting on your credit report. This could be a utility bill, secured credit card, or a reaffirmed mortgage or car loan. Additionally, about 45-60 days after the discharge is granted and the case is closed you should get a free credit report to make sure that your post-bankruptcy credit report is accurate. If it is not, then you should send a dispute the credit bureau notifying it of the inaccuracy.