9 Steps of a Chapter 7 Bankruptcy Case

If you’re thinking about filing for chapter 7 bankruptcy, you’re probably wondering what is involved in the process. Filing bankruptcy can be a bit overwhelming, especially since you’re probably still dealing with the stress of being harassed by creditors, but knowing how the process works can make bankruptcy a little less intimidating.

Here are the 9 steps involved with filing Chapter 7 bankruptcy:

1) Meet with your attorney. You’ll want to go over your finances, identify your creditors, and determine how much debt you owe. Your attorney will tell you which debts can be discharged, and which ones you’ll have to keep. You’ll also find out what you need to do if you want to keep your home or a car you’re still making payments on.

2) Compile your documentation. You’ll need to get the names and addresses of all of your creditors, document the amount that you owe each one, and provide income and other documentation.

3) Complete credit counseling. Before your case is filed, you will be required to complete a credit counseling course. Your attorney can help you locate an approved course in your area – in many cases, this requirement can even be completed online.

4) File your bankruptcy petition and related documents. Once everything is in place, your lawyer will file your bankruptcy petition, including documentation of your debts and income, with the bankruptcy court.

5) Attend the meeting of creditors. You will be required to attend a brief meeting with the bankruptcy trustee, your attorney, and any creditors that want to question you about your filing. Typically, very few creditors attend this meeting, so it is usually a painless event.

6) Attend a financial management class. Here, you will learn how to rebuild your finances so you don’t end up in bankruptcy again. Your attorney can help you find a financial management class.

7) Obtain discharge of your debts. As long as there are no creditor objections, you should receive a discharge within a few months of filing your bankruptcy petition. Once you have obtained a discharge, you are free and clear of your debts, except those you elected to keep or those which could not be discharged, such as student loan debts.

8) Review post discharge credit reports. You’ll want to make sure that all appropriate debts show as discharged on your credit report. Doing this ensures that you have a “clean slate” to rebuild your financial life.

9) Begin to rebuild. Put aside a certain amount of your income for financial emergencies, and obtain a credit card as soon as possible so you can begin rebuilding your credit. A low limit unsecured card will help the most, but if you cannot obtain an unsecured card, get a secured card from a company that reports on-time payments to the three credit bureaus. Over time, you can obtain lines of credit, a car loan, and even a home loan to rebuild your credit.

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