If I Decide to File, What will Occur and When? What is the Process?
Usually, the most painstaking part of a bankruptcy proceeding is the preparation. This involves accumulating exacting information about your personal finances and planning the appropriate use of the law. Completing a brief counseling course on the management of debt is also required under the law. When ready, you execute and file your petition and a series of other documents.
Shortly after your petition is filed, the presiding trustee schedules a meeting with you, to occur approximately six weeks later. The meeting takes place in a designated room, usually in a federal building but not a courthouse and not before a judge. The meeting is public, in that it occurs openly in a public building, but it typically occurs in a discrete location, and the only people usually in attendance are bankruptcy lawyers, their clients and occasionally creditors. Creditors receive notice of the meeting and have a right to attend and ask questions of a financial nature. The trustee asks various questions of a routine and financial nature. Although it varies, the meeting usually doesn’t take much longer than 15 minutes (if that), not including waiting time.
After the meeting in most cases, if you are proceeding under chapter 7, you will probably not have any more involvement with the court or the trustee. After certifying to having completed another brief course (also available online) in “personal financial management,” the court will enter an order that permanently discharges you from the obligation to pay certain debts. This does not mean that you cannot pay the debts. You can always pay anyone you like. It means that creditors can no longer pursue or contact you to collect the debts discharged. Any such contact or pursuit is a violation of federal and caries some harsh consequences. If you have received a discharge from the court and a creditor subsequently contacts you or references the discharged debt, you should contact your attorney immediately to see about having the creditor’s behavior corrected.
If you proceed under chapter 13, you will propose a plan to pay creditors a certain amount over time, usually five years. After meeting with the trustee, you will have to have your plan confirmed by the court. This does not typically require a court appearance. Without objection from a creditor, the court will typically confirm the plan without a hearing. If a creditor objects to the plan and you are represented by a lawyer, you will still not typically have to go to court, but your lawyer may have to attend a hearing on the objection.
After confirmation of your chapter 13 plan, you will have to make the monthly payments promised in the plan. If nothing changes and no disputes arise, after you have satisfied the provisions of your plan, the court will enter an order that permanently discharges you from the obligation to pay certain debts.
In most cases, that’s all there is to it, and it’s over. Other issues might arise, and that’s one reason why it’s a good idea to seek the counsel of a competent attorney, who can help you prepare.