course when filing for cghapter 7

Every person who files for bankruptcy has to take a credit counseling course in the 6 months before their bankruptcy petition is filed with the court. This is a requirement in both Chapter 7 and Chapter 13 cases. The course has to be taken through a credit counseling agency that is approved by the Department of Justice.

Full Answer

How do I file for Chapter 7 bankruptcy?

A chapter 7 case begins with the debtor filing a petition with the bankruptcy court serving the area where the individual lives or where the business debtor is organized or has its principal place of business or principal assets.

What happens to your business when you file for Chapter 7?

Nov 09, 2021 · In order to be discharged from Chapter 7 or Chapter 13 bankruptcy, you must complete a Pre-Discharge Debtor Education course. The purpose of this bankruptcy course is to help you remain financially secure and use credit wisely so you don’t end up in bankruptcy again. The course teaches: Preparing a budget; Money management

What is a Chapter 7 discharge?

When you file for Chapter 7, you lose control of the company. The bankruptcy trustee takes over the business assets and determines whether it's in the best interests of the creditors to sell the business as a whole or to sell off the assets. If you're liable for any of the business debt, this might cause a problem.

Who qualifies for Chapter 7 bankruptcy relief?

This self-paced, online personal financial management course satisfies your debtor education requirements after you file for a Chapter 7 or Chapter 13 personal bankruptcy in the U.S. SIGN UP 24/7 Course Access Log in anytime to access course Instant Certificates U.S. Bankruptcy Code Compliant English or Español Online or by phone in both

How do I prepare for Chapter 7?

The first step to prepare for bankruptcy is to gather proof of your income. Copies of your tax returns and copies of proof of income for the past six months are required when you file a Chapter 7 case. To prepare for bankruptcy under Chapter 7, you must complete the Chapter 7 Means Test.Sep 3, 2020

What is pre discharge debtor education?

About Pre-Discharge Education It prevents creditors or collection agencies from collecting debts through legal action or communication, such as phone calls, letters or personal contact.

What do you get to keep when filing Chapter 7?

In Most Cases, Chapter 7 Filers Keep Their Property Most Chapter 7 bankruptcy cases are no-asset cases. That means the debtors give up nothing to the trustee. The exemption systems permit debtors to retain the means of day-to-day living, free from the claims of their creditors.Oct 6, 2021

What Cannot be included in a Chapter 7?

Debts Never Discharged in Bankruptcy Alimony and child support. Certain unpaid taxes, such as tax liens. However, some federal, state, and local taxes may be eligible for discharge if they date back several years. Debts for willful and malicious injury to another person or property.

Can you add debt to a Chapter 7?

If you file a Chapter 7 case and find out about it before the case is closed, you can have your attorney file an amendment to add the creditor and all will be well.May 1, 2013

Is borrower a debtor?

What Is a Debtor? A debtor is a company or individual who owes money. If the debt is in the form of a loan from a financial institution, the debtor is referred to as a borrower, and if the debt is in the form of securities—such as bonds—the debtor is referred to as an issuer.

What happens to your bank account when you file Chapter 7?

In most Chapter 7 bankruptcy cases, nothing happens to the filer's bank account. As long as the money in your account is protected by an exemption, your bankruptcy filing won't affect it.Mar 21, 2022

What can they take during bankruptcies?

Generally, the types of assets that you can keep in a bankruptcy include:personal items and clothing.household furniture, food and equipment in your permanent home.tools necessary to your work.a motor vehicle with a value up to a certain limit, usually an older vehicle qualifies.certain farm property.

What assets can be taken in Chapter 7?

Exempt property (items that a debtor may usually keep) can include:Motor vehicles, up to a certain value.Reasonably necessary clothing.Reasonably necessary household goods and furnishings.Household appliances.Jewelry, up to a certain value.Pensions.A portion of equity in the debtor's home.More items...•Apr 7, 2021

What debts are not dischargeable in Chapter 7?

Generally speaking, in a Chapter 7 proceeding, the following types of debts are not discharged:Debts that were not listed at the start of the case (or debts for unlisted creditors). ... Most student loans (unless repayment would cause the debtor and their dependents undue hardship)Recent federal, state, and local taxes.More items...•Apr 7, 2021

Is credit card debt discharged in Chapter 7?

Credit Card Debt in Chapter 7 Bankruptcy Chapter 7 bankruptcy will discharge (wipe out) most or all unsecured, nonpriority debt. Medical bills, personal loans, and most credit card debt are typical examples of unsecured, nonpriority debt you can wipe out in bankruptcy.

Can creditors collect after Chapter 7 is filed?

Once you file for bankruptcy, an automatic stay goes into effect. An automatic stay specifically states that creditors cannot contact you to collect debts after you've filed for bankruptcy. It protects you from harassing phone calls, emails, and letters.Feb 20, 2020

How long before filing bankruptcy can you file for Chapter 7?

If your average gross income during the six months before you file is more than the median income for a family of your size in your state, you qualify. If not, you'll subtract allowed expenses from your income to determine whether you'll be allowed to use Chapter 7 bankruptcy.

How many pages do you need to file a secured debt?

You'll complete a few dozen pages of forms, in which you tell the court about all of your property, debts, income, expenses, and prior transactions. You'll list the names of all your creditors, property, and income, list your property exemptions, and decide what you want to do about each of your secured debts.

How to keep property in bankruptcy?

If you pledged property as collateral for a loan, you'll need to continue to pay the creditor if you want to keep the property. When you file for bankruptcy, you'll be asked to decide whether you want to "redeem" the property (pay the creditor the current replacement value of the property in a lump sum), "reaffirm" the debt (agree to continue paying per the contract with the creditor—usually under the same terms), or "surrender" the property (let the creditor take it). Depending on where you live, there might be other options as well (some lenders let debtors keep the property as long as they remain current on the loan). (Learn more about your options for secured debts in Chapter 7 bankruptcy .)

How often do you have to go to court for bankruptcy?

In most cases, you'll need to go to court only once for a short meeting with the trustee (and perhaps a creditor or two, although it's unusual for creditors to appear). The bankruptcy trustee appointed to your case will check your identification, and ask standard questions required of all debtors, as well as specific questions about the information in your forms. (To learn more see, The Meeting of Creditors in Chapter 7 Bankruptcy .)

What to do if you dispute a lien in bankruptcy?

If you dispute a creditor's claim against you or you want to eliminate certain liens, you'll need to address these matters before your bankruptcy case is closed (if you forget to handle a lien, most courts will allow you to reopen the case at a later date). 12. Wind up your secured debts.

How long does it take to file bankruptcy?

You must file the remaining forms within 14 days.

What happens when you file for bankruptcy?

When you filed your bankruptcy forms, you'll complete a form in which you stated how you intend to handle your secured debts. Before your case is closed, you'll need to act on these matters. For instance, if you indicated that you'd return a car, you'll want to be sure to make it available to the lender. (For more information, see What Is a Secured Debt?)

What is the form 23 for debtor education?

When you complete the debtor education course, you must file a form called Debtor’s Certification of Completion of Postpetition Instructional Course Concerning Personal Financial Management (Official Form 23) with the court.

How long does it take to get a bankruptcy education certificate?

Bankruptcy Education Deadlines. Those who file for Chapter 7 bankruptcy protection have 60 days after the first date set for the meeting of creditors to complete the debtor education course and file the certification of completion with the court.

What is the credit counseling requirement for bankruptcy?

It includes the requirement that all Chapter 7 or 13 bankruptcy petitioners complete approved credit counseling and provide to the court a certificate of completion from a U.S. Trustee-approved, nonprofit credit counseling agency. The law also requires all consumers who file for bankruptcy to successfully complete two bankruptcy courses prior to having debts discharged.

What is bankruptcy education?

What Is Bankruptcy Debtor Education? In order to be discharged from Chapter 7 or Chapter 13 bankruptcy, you must complete a Pre-Discharge Debtor Education course. The purpose of this bankruptcy course is to help you remain financially secure and use credit wisely so you don’t end up in bankruptcy again.

How to get credit counseling after bankruptcy?

With Pre-file Credit Counseling, you’ll start online, then receive a personal counseling session by telephone to discuss the details of your current financial situation with a Certified Financial Counselor. Your counselor will help you build an accurate picture of your current finances, then give specific advice on actions you can take to improve it. You’ll also discuss short- and long-term financial goals and determine if there are any alternatives to bankruptcy. The counselor will explain consequences of bankruptcy and actions you can take to get back on sound footing after a bankruptcy.

What are the exceptions to debtor education?

Exceptions include: being on active duty in a military combat zone. a disability that prevents you from taking the course. no court-approved course providers are available in your area. a course isn’t available in a language you understand.

What happens if you miss Chapter 13 bankruptcy?

Those who file for Chapter 13 bankruptcy must complete the class and file the certification of completion before your last repayment plan payment or before you file a motion for discharge. If you miss these deadlines , the court will dismiss your case. To reopen it, you must repay the bankruptcy filing fee.

What is Chapter 7 bankruptcy?

A typical Chapter 7 bankruptcy case is relatively straightforward. You will spend most of your time completing the bankruptcy petition, schedules, and other forms, which will require you to list your debts, assets, financial transactions, and so on. Once you've filed your paperwork, the bankruptcy trustee takes over your case.

What do you have to answer at a bankruptcy meeting?

At the meeting, you will have to answer questions about your finances and bankruptcy forms, under oath, from the trustee and any creditors who show up (often, none attends the meeting). This meeting is typically very short.

What happens if you default on a secured debt?

If you have secured debts -- debts that are backed by collateral, which the creditor has the right to take if you default -- you must give the property back, redeem it (by paying the creditor what it's worth), or reaffirm the debt (agree that you will still owe it after your bankruptcy case is over).

How long will the 341 meetings last?

COVID-19 Update: Bankruptcy courts will hold 341 creditor meetings telephonically or by video appearance until 60 days after the termination of the President's COVID-19 National Emergency Proclamation. For details, visit the U.S. Trustee's 341 meeting status webpage or your court's website. If you're one of the many struggling with debt due ...

What is a 341 meeting?

You'll receive a notice from the court, telling you when your meeting of creditors (also called a "341 meeting," after its place in the bankruptcy code) will be held. At the meeting, you will have to answer questions about your finances and bankruptcy forms, under oath, from the trustee and any creditors who show up (often, none attends the meeting). This meeting is typically very short.

What happens if you sell nonexempt property?

If you have any nonexempt property, the trustee will decide whether it's worth seizing and selling , to distribute to your creditors . You may be able to negotiate with the trustee to keep certain nonexempt property if you can come up with enough cash or are willing to give up exempt property instead.

How long does it take for a bankruptcy to be closed?

After you attend a brief court hearing (the meeting of creditors) and meet a few other requirements, you'll receive your discharge and your case will be closed, usually, four-to-six months after you file for bankruptcy.

What is Chapter 7 bankruptcy?

Chapter 7 bankruptcy is the most popular form of bankruptcy relief for individuals. The basic idea behind Chapter 7 is this: The bankruptcy trustee appointed to your case sells your property to pay off your creditors and ends with a discharge of qualifying debt, such as credit card balances, medical debt, and personal loans.

How many meetings of creditors do you have to attend in bankruptcy?

You'll attend the meeting of creditors. Every filer must attend one meeting of creditors (341 hearing) conducted by the bankruptcy trustee. You can expect the trustee to verify your identity and ask you questions about your petition and finances. Creditors can, but often don't, appear to ask questions.

What happens if you don't protect your equity in Chapter 13?

Even if you're current, however, if you can't protect your equity with an exemption, the trustee will sell the property. Other options include surrendering (giving back) the property, or redeeming (paying the fair market value for) the property. Learn how Chapter 13 can help debtors keep secured property.

How long does it take to turn over bankruptcy papers?

You'll turn over supporting paperwork. At least five days before the meeting of creditors (more below), you'll send documentation to the trustee (or the court in some jurisdictions) that proves the statements made in your bankruptcy paperwork.

What do you need to do to file for bankruptcy?

A filer must complete a debtor's education course in addition to the credit counseling received before filing for bankruptcy before receiving a discharge. The court will issue the bankruptcy discharge. After completing the requirements above, the court will grant a bankruptcy discharge and the automatic stay will end.

What is automatic stay?

Find out more about the forms you'll need to file for bankruptcy. The automatic stay will stop creditors. Once you file your bankruptcy petition, an order—called the automatic stay —is put into place if it's your first bankruptcy filing (the stay isn't always available for subsequent bankruptcies).

How long does it take to file for bankruptcy?

Most Chapter 7 bankruptcy cases take about four months to complete and move through the process without a hitch, but it's not for everyone. Find out about some of the differences between Chapter 7 and Chapter 13.

What happens when you file Chapter 7?

When you file for Chapter 7, you lose control of the company. The bankruptcy trustee takes over the business assets and determines whether it's in the best interests of the creditors to sell the business as a whole or to sell off the assets.

Why is Chapter 7 liquidation important?

A Chapter 7 liquidation can help alleviate a common creditor concern—that an officer or member might be diverting funds into private coffers rather than paying creditors because a business Chapter 7 is set up to sell the company's assets and pay its obligations in a very public manner.

What does a bankruptcy trustee do?

The bankruptcy trustee will sell all of the corporation or LLC assets and distribute the proceeds among creditors according to the priority rules established in bankruptcy law (exemptions—the law that allows individuals to protect property in bankruptcy—aren't available). The goal is an orderly business liquidation.

How is a corporation created?

A corporation or LLC is created by filing documents with the secretary of state and paying registration fees. Once established, the company operates as a separate legal entity. The business owns assets and is legally liable for paying its debts.

What happens to debt after bankruptcy?

After the bankruptcy, the amount of debt remaining will often be greater than if you took on the responsibility of selling the assets yourself. There are a few reasons this could happen. You might be able to get a better price for the business or assets (bankruptcy asset buyers are looking for—and expect—a deal).

What happens when you close your doors?

When shutting the doors of a corporation or LLC, the corporate officer or the LLC's managing member must sell off (liquidate) the company assets and distribute the funds to the creditors. Notice of proper closure must be filed with the secretary of state. Failing to follow these procedures could subject individuals holding an ownership interest to liability.

Can bankruptcy trustees sell a business?

The bankruptcy trustee can sell only the filer's interest in the company, not the entire business, unless the filer is the sole shareholder or member, of course. As an aside, few buyers are willing to purchase a partial interest in a small business.

How long does it take to get a bankruptcy certificate?

Getting Your Credit Counseling For Bankruptcy Certificate: Must be completed within 180 days before filing for bankruptcy. 60-90 minutes in length and can be completed online or by phone in English or Spanish.

What is required before filing for bankruptcy?

Before Bankruptcy: Credit Counseling Certificate. Before you file for a Chapter 7 or Chapter 13 bankruptcy, a Credit Counseling for Bankruptcy Certificate is required by law.

What is a personalized counseling session?

Personalized counseling session includes budget analysis, financial management, and explores possible alternatives to bankruptcy. Includes a one-on-one session with a certified counselor and a customized action plan.