The Bankruptcy Process | Start Fresh Today

People generally file for Chapter 7 bankruptcy to discharge credit card debts and other unsecured debts. So what happens when one files for bankruptcy under Chapter 7 of the U.S. Bankruptcy Code?

First thing you need to remember is to complete a Credit Counseling briefing -- this can be done online or by phone and your bankruptcy attorney can help you get started on this process.

After obtaining your credit counseling certificate, you'll need to provide your bankruptcy lawyer with all information on your assets, income, expenses and debts. Your bankruptcy lawyer will use this information to prepare your Chapter 7 bankruptcy petition, which will be filed in a local bankruptcy court.

Upon your bankruptcy filing, the court will appoint a bankruptcy trustee who will enter an order for an automatic stay, which essentially stops all collection actions against you during your Chapter 7 bankruptcy case.

Six weeks after filing, you'll need to attend a meeting of creditors and testify to the accuracy of the information in your bankruptcy petition. Generally, Chapter 7 bankruptcy cases are very quick. Many people receive their discharge six months after filing Chapter 7 bankruptcy.

The process for Chapter 13 is similar to chapter 7, although people generally file for Chapter 13 bankruptcy to help stop foreclosure or vehicle repossession. Chapter 13 of the U.S. Bankruptcy Code often allows people to keep these cherished items via the establishment of a repayment plan of past debts.

Like Chapter 7, you will be required to obtain a certified credit counseling certificate prior to filing. Once you've obtained your credit counseling briefing, you will work with your bankruptcy lawyer to prepare your information in order to file Chapter 13 bankruptcy.

Also like a Chapter 7 bankruptcy case, you will need to attend a meeting of creditors after filing Chapter 13 bankruptcy. Throughout your Chapter 13 bankruptcy case, your bankruptcy lawyer will work with you in developing a 3-5 year repayment plan in which you can catch up on your past-due debts while still remaining current on your monthly payments.

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