Types of Bankruptcy

Types of Bankruptcy - Chapter 7, Chapter 13, Chapter 11

Chapter 7

This type of bankruptcy discharges unsecured debt and the decision as to whether or not you can file a chapter 7 is based on income, expenses and assets. Many people do not qualify for this chapter of bankruptcy because they have too much excess income or they have assets that cannot be protected. In a chapter 7, most unsecured debt is discharged although certain types of debt such as taxes, alimony, child support and court fines are non-dischargeable and will survive the bankruptcy. Attorney fees, filing fees and credit counseling fees are required to be paid upfront before the case can be filed.

Chapter 13

This is the most common type of bankruptcy and can be described as a repayment plan or reorganization. In a chapter 13, we can include mortgage arrears, back taxes, child support and court fines along with credit card and medical debt. Clients make payments to the Chapter 13 Trustee that is assigned to their case and he pays your creditors as those funds are received. The filing fees are typically paid upfront but in some cases they can be added to be paid through the bankruptcy along with our attorney fees.

Chapter 11

This type of bankruptcy is normally for businesses. Attorney fees and filing fees are required upfront before the case can be filed.

What to Expect

When you schedule a consultation, you will be asked to bring some information with you. This information will help Mr. Dunn advise you correctly on your options. You will need to bring proof of all household income for the last two months, the last two years of tax returns and all of your bills. If you are self-employed, you will need to bring profit and loss statements for the previous two months. We will run a credit report for you as well. When you come in for your consultation, you will meet with a staff member who will enter your information into our bankruptcy program. After this is done, Mr. Dunn will meet with you to discuss your options for filing bankruptcy. If you decide to file, we will schedule a signing appointment and give you a list of some other documents that the court requires that you will need to bring to your appointment.

In all bankruptcy cases, the court schedules at least one hearing. The first hearing is called a Meeting of Creditors (also called a 341 hearing) where you meet with the Trustee that has been assigned to your case. He will review your bankruptcy petition and will ask you questions in regards to your case. In Chapter 13, there is a second hearing which is called a confirmation hearing; this is when the Trustee and the court approve your bankruptcy plan. In some cases, such as when a debtor is unemployed, the Trustee will ask the court to schedule a status hearing so that he can be updated on your situation.

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