Chapter 7 Filing Process
The filing of a bankruptcy case is governed by the rules of the bankruptcy court where you will be filing. Always read the rules before filing your case or even filling out the paperwork. Where you file will usually be the county in which you reside, as long as you have lived there the greater part of the last six months. See www.uscourts.gov to locate your court.
You do not need to be represented by an attorney to file bankruptcy. However, if you are not very business or computer-literate, it would be in your best interests to seek the assistance of an attorney. If you use a paralegal service to file your case, be aware that there are set guidelines as to how much a bankruptcy petition preparer can charge, which they are required to disclose to you.
The bankruptcy petition consists of the petition itself, the schedules, some local forms, and the Means Test. The Means Test determines whether you qualify for a Chapter 7 based on your current monthly income. The current monthly income received by the debtor means the average monthly income received over the six calendar months before commencement of the bankruptcy case, but not including social security income.
Before any person can file for bankruptcy, they must obtain credit counseling from an approved provider. See your local court’s website for a list of approved providers. The class will take 1-2 hours and there is a fee (usually under $50). Businesses can file Chapter 7 bankruptcies, but are not required to take the credit counseling class.
You can access your local court’s website to complete and print all the forms required of a Chapter 7 filing. For the Central District of California, the following forms are required of an individual debtor:
1. * Statement of Social Security Number (Official Form B21)
2. * Voluntary Petition
3. Exhibit C – if applicable
4. Exhibit D - Individual Debtor’s Statement of Compliance with Credit Counseling Requirement
5. Statement of Related Cases
6. Notice of Available Chapters [required for individuals whose debts are primarily consumer debts
7. Summary of Schedules and Statistical Summary of Certain Liabilities and Related Data
8. Schedules A through J
9. Declaration Concerning Debtor's Schedules
10. Statement of Financial Affairs
11. Chapter 7 Individual Debtor’s Statement of Intention
12. Disclosure of Compensation of Attorney for Debtor (for petitions of persons who are represented by legal counsel or where an attorney has prepared the paperwork)
13. Declaration Re Limited Scope of Appearance Pursuant to LBR 2090-1, (if applicable)
14. Copies of all payment advices (pay stubs) or other evidence of payment received by the debtor from any employer within 60 days before the filing of the petition and optional form Debtor’s Certification of Employment Income Pursuant
15. Statement of Current Monthly Income and Means Test Calculation
16. Verification of Creditor Mailing List
17. *Master Mailing List
18. *Certificate of Credit Counseling
An “emergency filing” can also be filed. This happens when you are unable to complete all the documents before you need to file (usually to stop a trustee sale of real property or wage garnishment). To file on an emergency basis, the items marked with an asterisk (*) above are the minimum documents needed to file. The balance of the documents will be due within two weeks of filing. If you cannot complete the credit counseling before you file, you can file without it, but must provide a declaration as to why you could not complete the counseling before filing.
After completing all forms, sign and date them, then make a copy. Bring them with you to the court clerk along with cash for the filing fee ($299). The court will also take postal money orders and checks drawn on an attorney’s account. The clerk will “file” the documents and give you a receipt that shows your case number, hearing date, and Judge/Trustee assignment. The hearing date will usually be in about 4-6 weeks.
Within a week after filing, the clerk will mail a Notice of Case Commencement to you and all your creditors. This is the notification the creditor will receive that will require them to stop making harassing phone calls and collection attempts. It also sets forth the hearing date, time, and location, and other important deadlines for creditors.
You are required to mail your last tax return to the trustee assigned to your case within one week before your hearing date. When you go to your hearing, you must bring your social security card and driver’s license, and it is best to bring a copy of your petition documents and tax returns though not required. The hearing will be short, often taking five minutes or less and the trustee will ask you a few questions about your case. The trustee will then dismiss you or may continue the hearing to another date if additional documents are requested or if your paperwork needs to be amended.
You will need to take a class on personal financial management before your case can be discharged. The Debtor’s Certification of Completion form and the certificate must be filed within 45 days of your hearing. The discharge will come in the mail usually about 3-4 months after your hearing. At that time, your debts have been discharged and you can start fresh with your life.