The most common type of bankruptcy case is the Chapter 7 no asset case. In this case the debtor does not lose any property and unsecured creditors (e.g. credit card companies and medical bills) receive nothing. A Chapter 7 no-asset bankruptcy is usually a “quick and easy” process. The following timeline describes the process:
Meet Your Attorney
Your attorney will listen to your concerns, identify legal issues concerning your debts, and recommend legal solutions. While bankruptcy is not always the best option to solve a financial problem, it is a powerful tool that should be considered. Your attorney will also ask you to provide financial documentation such as tax returns, titles and deeds, and paystubs. Your attorney will take this information and draft a bankruptcy petition.
Before you can file bankruptcy you must meet receive credit counseling from an approved credit counseling agency. Your attorney will recommend an agency that is approved.
Sign and File Your Bankruptcy
Once the petition is drafted, you will meet with your attorney to review and sign your bankruptcy petition and schedules. You must verify the contents of your bankruptcy filing under penalty of perjury, so it is important to carefully review this document. You must also pay your court filing fee (currently $306).
Attend Financial Management Class
After your case is filed you will attend a course in personal financial management from an approved agency. This course must be completed before the court can enter a discharge, so you might as well get it out of the way as soon as possible.
Section 341 Meeting of Creditors with Trustee
The bankruptcy court will send out notices of your Meeting of Creditors. Your meeting will take place between 30 and 45 days after your case is filed. While creditors do not typically attend this meeting, you will answer questions under oath from the Chapter 7 Trustee about your debts and property.
The Chapter 7 Trustee’s report is due to the bankruptcy court within 10 days after your Meeting of Creditors has concluded. This report states that the Trustee has completed a review of the case and that there are no assets to administer.
Creditors have 60 days after the date first set for the Meeting of Creditors to file an objection in your case. Objections are rare, especially in Chapter 7 no-asset cases.
Discharge and Conclusion
If no objection is filed and all other requirements are satisfied, the bankruptcy court will enter an order discharging your debts, and soon thereafter it will close your case.
Every bankruptcy case is different and some cases do not follow the timeline described above. An experienced bankruptcy attorney will conduct an investigation of your finances and can give you a very good indication of what to expect during your bankruptcy, including how long it will take.