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Understand the Bankruptcy Process in Ohio Before Getting Started with Your Bankruptcy Petition
SCOTT R. NEEDLEMAN
COLUMBUS BANKRUPTCY AND FORECLOSURE DEFENSE ATTORNEY
The decision to file bankruptcy is never made lightly. Most debtors struggle with the decision for months trying to avoid bankruptcy, frequently getting themselves even deeper into debt trying to juggle financial obligations. Due in large part to the recent recession, the number of bankruptcy filings have hit record highs in the United States. If you are one of the millions of people across the country who has made the difficult decision to file for bankruptcy, you are likely apprehensive about the process itself and unsure what to expect. Although every bankruptcy petition is unique, there are some basic steps that most debtors go through during the bankruptcy process. Understanding the process better before you get started may ease some of your apprehension.
credit rating but it will not typically have the same impact as a chapter 7 filing because a chapter 13 calls for you to repay your debts. You may also wish to consider what type of debt you need to bankrupt. Some debts, such as student loans and child support, cannot be discharged through a bankruptcy. Be sure that your debts can be discharged before making the decision to file for bankruptcy.
CHOOSING AN ATTORNEY
Once the decision has been made to pursue bankruptcy the next step should be to choose an attorney. Technically, there is no legal requirement that a debtor be represented by an attorney when filing for bankruptcy; however, given the complexity of the subject matter, the importance of the outcome, and the sheer volume of paperwork involved it is a wise decision to retain the services of an experienced bankruptcy attorney.
CHOOSING A CHAPTER
The US bankruptcy code is divided into chapters. It is for this reason that we refer to the type of bankruptcy that someone files as a "chapter 7" or "chapter 13". There are four different chapters under which an individual debtor may file for bankruptcy-chapters 7, 11, 12, and 13. Although available to an individual, a Chapter 11 is typically used by small businesses. A chapter 12 bankruptcy is for family farmers and fishermen. That leaves chapters 7 and 13. A chapter 7 bankruptcy is known as a
"liquidation" because a debtors nonexempt assets are sold by the trustee to provide liquid assets with which to repay creditors. A chapter 7 bankruptcy requires a debtor to pass a "means test". In short, the means test compares your income to that of other similar households in Ohio. If your income is at or below the median income for similar households then you may file a chapter 7 bankruptcy. At the end of the chapter 7 bankruptcy the majority of your debts will be discharged, or forgiven. A chapter 13 bankruptcy is typically used by debtors with above average income and/or who have valuable assets that they wish to retain. In a chapter 13 bankruptcy you will be required to create a repayment plan that will allow you to repay the majority of your debts over an extended period of time-usually three to five years.
GATHERING DOCUMENTS
There are a number of documents and records that you will need to put together in order for your attorney to prepare the bankruptcy petition and all of the required schedules. While the required documents will vary from one debtor to another some common documents and records include: Income tax returns Pay stubs or 1099s Deeds and titles Loan documents Creditor names and addresses
must be taken after you file but before the bankruptcy is discharged. The options for completing this class are typically the same as the credit counseling class.
341 HEARING
In both a chapter 7 and chapter 13 bankruptcy you will be required to attend a "341 hearing". Named for a section of the bankruptcy code, the 341 hearing is also referred to as the meeting of creditors. The meeting is typically held in either an informal office located in the federal courthouse
or at the trustee's own private office. It will not take place in open court at any rate. In fact, if you file a chapter 7 bankruptcy you will typically never set foot in a courtroom. The purpose of the meeting of creditors is to allow creditors to examine you under oath regarding your income, debts, and assets. In a chapter 7 bankruptcy it is not uncommon for none of the creditors to appear at the meeting of creditors. In a chapter 13 bankruptcy there is a higher likelihood that creditors will appear for the 341 hearing, particularly if you have secured debt included in your bankruptcy. You and your attorney will prepare ahead of time for the meeting; however, the questions are usually simple enough to answer as they usually relate to information that has already been included in your bankruptcy.
has in the bankruptcy. When the repayment plan has been approved you will send one monthly payment to your trustee each month whe will then distribute the funds among your creditors.
United States Courts, Bankruptcy Basics NOLO, A Chapter 7 Bankruptcy Overview NOLO, Steps in a Typical Chapter 13 Bankruptcy Case
Every associate at The Needleman Law Office is committed to handling your case in both a personal fashion and in a professional manner. In other words, we treat you the way we would want to be treated. We will take a personal interest in your situation, making sure you understand exactly what is happening and what options you may have. Then well fight to ensure the best possible outcome for your situation.