The process of filing bankruptcy can be complex. You must submit specific forms and provide a plethora of information to the bankruptcy court. There are court hearings and legal procedures that you must follow. A skilled bankruptcy attorney can guide you through the process and help you understand your legal options in Dallas.
Steps in the bankruptcy process include the following:
Step 1: Complete a credit counseling course.
Within 180 days prior to filing for bankruptcy, you must complete a credit counseling course. The U.S. Trustee’s office must approve the course, and it can cost between $25 and $35 for the course. If you cannot afford a credit counseling course, you may qualify for discounts or a free course.
Step 2: File your bankruptcy petition with the federal court.
You must file a petition for bankruptcy along with a filing fee with the federal bankruptcy court in your jurisdiction. You must also submit information about your income, debts, and any assets you own. The bankruptcy court will quickly issue an automatic stay order, which will pause all creditor collection efforts. If you are dealing with a foreclosure or repossession, these will stop. Calls, emails, and other contact from creditors will also be routed to your bankruptcy attorney. An automatic stay will not be put into place or will be limited if you have already filed for bankruptcy once or more within the last 12 months.
Step 3: Attend a 341 Meeting of Creditors.
Within 60 days of when you file your bankruptcy petition, you will attend a hearing called the meeting of creditors. This hearing will not take place in a court, but will likely be in a meeting room. Your bankruptcy trustee, attorney, and creditors may appear at the hearing. However, it is rare for creditors to actually attend the meeting of the creditors. Typically, you answer questions from the trustee and review information that you submitted with your bankruptcy petition.
Step 4: Take a second debt counseling course.
After your meeting with the creditors, you will have to take a second debt counseling course. This will help you understand your current budget and how to manage your debts going forward.
Step 5: The court will confirm your eligibility to file bankruptcy.
The bankruptcy court will review your information along with any challenges presented at the meeting of creditors. If you are filing Chapter 7, the bankruptcy court will ensure you pass the Means Test. If you are filing Chapter 13, the bankruptcy court will review the amount of your secured and unsecured debts and determine if you qualify.
Step 6: The court will manage your debts.
If you are eligible for bankruptcy, the court will handle your debts according to the chapter of bankruptcy that you are requesting. If you are filing Chapter 7, the court may require you to liquidate some of your property to pay your creditors. When filing Chapter 13, you may have to submit a proposed payment plan. In the end, the court will require you to pay necessary debts and receive a discharge of eligible debts.
