How to file chapter 7 bankruptcy
yourself!
Filing chapter 7 bankruptcy yourself is possible if you understand the process, have the proper forms, and you qualify for this chapter of the federal bankruptcy code.
This site provides in-depth coverage for filing chapter 7 bankruptcy including FAQs, online forms, how a chapter 7 works, the role of the Trustee, the bankruptcy discharge and alternatives to filing chapter 7 bankruptcy.
Up Chapter 7 bankruptcy - Background
Chapter 7 bankruptcy provides an "order of relief" that triggers an "automatic stay" thus all creditors and collectors are prohibited from pursuing you or your property outside of the bankruptcy proceeding.
Note: This is especially important if you've received a foreclosure notice!
Chapter 7 bankruptcy is also known as a "straight bankruptcy" or "liquidation bankruptcy" because the Trustee gathers and sells your nonexempt assets and then distributes the proceeds to your creditors in accordance with the provisions of the bankruptcy code.
You are permitted to retain certain “exempt property" but all remaining assets are liquidated (sold) by the bankruptcy court Trustee. You should also understand that if you file a chapter 7 bankruptcy you could loose some or all or your property!
Chapter 7 bankruptcy relief is available to you irrespective of the amount of your debt or whether you are solvent or insolvent. Chapter 7 bankruptcy is not available to partnerships or corporations.
IMPORTANT NOTE! You cannot file chapter 7 bankruptcy (or any other chapter), if during the preceding 180 days, a prior bankruptcy petition was dismissed due to your willful failure to appear before the court or comply with orders of the court or you voluntarily dismissed the previous case after creditors sought relief through the bankruptcy court to recover property upon which they hold liens.
Filing chapter 7 bankruptcy usually results in a discharge of debts, but your right to a discharge is not absolute, and some types of debts are not discharged. Additionally, a chapter 7 bankruptcy discharge does not remove a lien on property.
Up Chapter 7 bankruptcy - A Quick Overview
After filing bankruptcy chapter 7, all property, except exempt property, is turned over to a Trustee appointed by the court.
A few days after filing your petition, the court clerk sends an official notice of your bankruptcy filing to your creditors and then sets up a 341 meeting for the purpose of allowing your creditors (if any even show up) to question you about your debts and your ability to pay them.
Creditors and the trustee can question you and you're expected to respond in good faith. Creditors who object to your listed exemptions must do so within 30 days after the 341 meeting.
Creditors must also file a proof of claim against you within 90 days after the 341 meeting. Although rare, if, after your case is closed and a surplus of funds or assets exists and all claims are paid in full, the court may grant an extension of time to creditors to still file a claim against you.
If the trustee or any creditor objects to you receiving a general discharge of all of your debts, they must file their objection within 60 days following the 341 creditors meeting. Otherwise if no objections are filed, and no motion to dismiss is pending, the court will ordinarily grant a discharge upon expiration of the 60 day period.
NOTE: A creditor may object to a particular debt being discharged, but only within 60 days of the first date set for the 341 meeting of creditors, if;
- You created a debt just before filing;
- You've committed fraud;
- You committed a willful and malicious injury to the person or property of another.
Up Chapter 7 bankruptcy forms and schedules as a minimum:
Official Bankruptcy Forms for Chapters 7 & 13 Form B1 - Voluntary Petition |
Official Schedules for filing bankruptcy yourself Form B6a: Schedule A - Real Property |
Up Chapter 7 bankruptcy - Special Notes
- An involuntary chapter 7 case may be commenced under certain circumstances if creditors holding claims against you file a petition;
- Both husband and wife can claim bankruptcy exemptions;
- Bankruptcy administrators serve in the judicial districts in the states of Alabama and North Carolina.
- A fee of $400 is charged for converting chapter 7 bankruptcy to a chapter 11.
- There is no fee to convert a chapter 7 to 13.
- Unsecured debts generally may be defined as those for which the extension of credit was based purely upon an evaluation by the creditor of the debtor’s ability to pay, as opposed to secured debts, for which the extension of credit was based upon the creditor’s right to seize pledged property on default, in addition to the debtor’s ability to pay.
More in-depth information on how to file chapter 7 bankruptcy
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