CONTANT LAW, P.C.

Steps in the Bankruptcy Process


Bankruptcy Process in Middlesex County MA

Photo of Bankruptcy WorksheetThe first step is to gather together the appropriate documents listed on the “Documents to Bring Attorney” page of this website. These are needed for us to properly assess your overall financial situation to determine whether bankruptcy is appropriate for your particular circumstances and to determine which type of bankruptcy may be appropriate for you.

One of our attorneys will then need to meet with you a minimum of two (2) times.

First Meeting:

At the first meeting we will meet with you for approximately 1 ½ to 2 hours. We will go over your paperwork and conduct an in depth interview of you. Among other things, this is to determine your overall financial situation, whether you qualify for bankruptcy and if so, what type would best fit your situation.

The interview is used to answer four (4) basic questions about you:

  1. What do you own?
  2. How much do you owe?
  3. What is your monthly income?
  4. What are your monthly expenses?

We will use that information, along with the documents you provide, to complete the bankruptcy petition, which is approximately 40 – 50 pages long.

Credit Counseling:

Under the 2005 Bankruptcy Reform Act, with limited exceptions, all people who file for Bankruptcy protection must complete a pre-bankruptcy credit counseling class within the six (6) months immediately prior to filing.

This class can be done in person, over the telephone or online. We recommend doing the class online. It will usually take approximately 1 hour to complete. You will be asked questions about your assets, debts, income and monthly expenses. While the cost is no more than $50.00, we have found a number providers who provide the course for much less, some under $10.00.

Following the completion of this Credit Counseling class you will receive a Certificate. The Certificate must be given to your attorney to include with the rest of your Bankruptcy papers. If you do the class online, you will be emailed the Certificate and can print it. You can also have the class provider email a copy directly to us, so long as you provide our email address while taking the class.

The class must be done with one of the specific authorized providers of these classes. In addition, it must be the class specifically designed to be completed prior to Bankruptcy. A list of some of these authorized providers can be found on the “Credit Counseling Providers” document.

Second Meeting:

At the second meeting, we will review the entire completed petition with you. This is necessary to ensure that all information contained in the petition is true and complete to the best of your knowledge. You will be asked to sign the petition in several places.

Following this meeting, the attorney will file the petition with the Bankruptcy Court and a case number is assigned.

Automatic Stay:

At this point you are under the protection of the Bankruptcy Court. What they call an “automatic stay” is immediately put into place. That simply means that none of your creditors are allowed to contact you in any way or make any further attempts to collect any debts from you without first receiving permission from the Bankruptcy Court. Before receiving this permission, the particular creditor must file a written motion with the Court asking for this permission. They must have specific reasons for this request and the Bankruptcy Code limits the circumstances in which such permission can be granted. Further, we will have the ability to oppose any such requests or motions. For more information on this, please visit the “Stop Foreclosure, Lawsuits, Calls & Harassment” page on this site.

Creditor’s Meeting:

Approximately 4-5 weeks after we file the Bankruptcy petition with the Court, you and the attorney must attend a “Creditor’s Meeting.”   This is usually held in a conference room at the Bankruptcy Court. However, the location can vary depending on where you live. You are required to bring to this meeting a photo ID (i.e. driver’s license, military ID, Mass. ID card, etc.) and your Social Security Card or some other official document which bears your Social Security Number (i.e., W-2, 1099, etc.).

This is not a hearing before a Judge. The person conducting the hearing is called the “Trustee.” Their job is to review the petition to ensure things have been done appropriately. They are also there to determine whether you own anything which could legally be seized and used to pay some of your creditors. They may only seize property which is not exempt from taking under the Bankruptcy Code. For the average person, most of their property is exempt and they are able to keep it. For more information on this, please visit the “What Stuff Do I Get to Keep?” page on this site.

The Trustee will review certain parts of your petition with you. He or she will verify that you signed the petition and that your reviewed the pages before signing them. This is to ensure that all of the information is true and complete to the best of your knowledge. The Trustee may have specific questions about a particular asset or debt. The Trustee will usually ask some general questions such as “how did you get in this situation?” Keep in mind that there is no one right answer to this question. There are many reasons why someone may need to file for bankruptcy. The reasons are varied and may include, illness, loss of job, incurring debt over a long period with increasing interest rates, etc.

Your creditors also do have the right to be present at the Creditor’s Meeting and ask questions regarding your financial position. Hence the name “Creditor’s Meeting.” However, in most cases no creditors actually come to the meeting.

All in all the questioning itself usually lasts between 5 and 10 minutes.

Financial Management Course:

With limited exceptions, all people who file for Bankruptcy Protection must complete a “Financial Management Course.” This course is also sometimes called a “Debtor Education Course.” It must be completed within sixty (60) days after the Creditor’s Meeting.

Like the “Credit Counseling” noted above, this class can be done in person, over the telephone or online. We recommend doing the class online. In fact, usually the same provider / website used to do the Credit Counseling can conduct the Financial Management Course.

This class takes a mandatory minimum of two (2) hours to complete. There are materials to review and a test at the end. The class is geared toward teaching basic strategies for managing money and debt. While the cost is no more than $50.00, we have found a number providers who provide the course for much less, some under $10.00.

The class must be done with one of the specific authorized providers of these classes. A list of some of these authorized providers can be found on the “Financial Management Course Providers“.

Following the completion of this class you will receive a Certificate. The Certificate must be given to your attorney to include with the rest of your Bankruptcy papers. If you do the class online, you will be emailed the Certificate and can print it. You can also have the class provider email a copy directly to us, so long as you provide our email address while taking the class.

After the Creditor’s Meeting:

In most Chapter 7 cases, after the Creditor’s Meeting is over, other than taking a “Financial Management Course,” (discussed above) there is little else to do but wait. In Chapter 13 cases, you will also have the continued responsibility of making your monthly Plan payments for a period of no less than 3 years and no more than 5 years. For more information on the benefits and drawbacks of Chapter 7 and Chapter 13, please refer to the “Chapter 7″ and “Chapter 13″ pages on this site .

A couple of other things to keep in mind. There is a thirty (30) day deadline from the date of the creditor’s meeting during which the Trustee may object for good cause to any of the property exemptions selected by the debtor. There is also sixty (60) deadline during which a Complaint may be filed with the Bankruptcy Court to object for good cause to you receiving a Discharge from the Court or to object to the Dischargeability of any of your particular debts.

In a Chapter 7 case, if no one objects, then you will automatically receive a Discharge after the expiration of the sixty (60) day period. In a Chapter 13 case the Discharge will not enter until you have completed all of your Plan payments, which is between 3 and 5 years.

If someone does object to your exemptions; receiving a Discharge; or to the Dischargeability of certain debts, we will have the ability to oppose any of these objections in Court. It will be up to the person or entity objecting to prove to the Court that they have good cause for doing so. It is important to keep in mind that objections can only be raised for specific and limited reasons.   For most cases we can identify these problems before they arise and will let you know if we believe there will be any issues.

Michael A. Contant, Esq.

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