How To File For Bankruptcy
Filing for bankruptcy is a legal process that either reduces, restructures or eliminates your debts. Whether you get that opportunity is up to the bankruptcy court. You can file for bankruptcy on your own, or you can find a bankruptcy lawyer, which most experts regard as the prudent avenue to pursue.
Bankruptcy costs include attorney fees and filing fees. If you file on your own, you will still be responsible for filing fees. If you cant afford to hire an attorney, you may have options for free legal services. If you need help finding a lawyer or locating free legal services, check with the American Bar Association for resources and information.
Before you file, you must educate yourself on what happens when you file for bankruptcy. Its not simply a matter of telling a judge Im broke! and throwing yourself at the mercy of the court. There is a process a sometimes confusing, sometimes complicated process that individuals and businesses must follow.
The steps are:
Cuyahoga County Oh Bankruptcy Guide
- Secured debt vs. unsecured debt: What’s the difference? Bankruptcy helps you get rid of unsecured debt. It does not eliminate secured debts, where you have pledged collateral for a loan, such as a car loan or a mortgage. When you file bankruptcy you must declare what you intend to do about your secured debts.
- Do I need a lawyer to file for bankruptcy? The law does not require to have a lawyer, and if your case is simple and you have few assets, you can successfully file a Chapter 7 bankruptcy yourself. Chapter 13? Not so much. And if you have property to lose, or you’re not great with details, getting a lawyers help can be a good idea, no matter what kind of bankruptcy you’re filing. Also a lawyer may find ways to help that you haven’t’ thought of
- Do I have to get credit counseling before I file for bankruptcy? Yes. You must complete a credit counseling course before you file your bankruptcy petition. Fortunately, it’s easy and can be done online. And your case cannot be completed (i.e. you can’t get your “discharge order” from the judge until you take a “Debtor Education” course.
Attend A Meeting Of The Creditors
In addition to the other requirements, you must attend a court hearing known as a Meeting of the Creditors or a 341 Meeting. Your bankruptcy attorney can attend this hearing with you. At this hearing, your trustee will ask you questions about your debts, assets, and income.
You will have to show your drivers license and social security card. You may be required to submit additional documentation. This hearing is typically brief, and creditors rarely attend.
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Official Form: 106 Real Property
All interests in real property must be disclosed, and the form of ownership, individual joint, community property, joint with right of survivorship, etc., must be disclosed. Also, the fair market value of the property and any encumbrances including liens placed on the property by creditor must be disclosed. And, a future interest such as a life estate must be listed as well.
Documentation to prove the information in the petition would include recorded copies of mortgages, deeds, land contracts, and etc. Note that the copies must be recorded copies, and you may need to purchase these from the county recorders office.
Automobiles Trucks And Motorcycles
The bankruptcy code currently protects up to $4,000 of equity in a motor vehicle per individual person filing bankruptcy. When you file Chapter 7 bankruptcy yourself, this can be confusing.
The exemption cannot be split up among several vehicles and can only be applied to one vehicle. If the vehicle is owned jointly, then the bankruptcy code presumes that each listed owner has a 50% interest in the vehicle. Properly applying the exemptions is critical to protecting your property. If you dont get this right, the trustee could ask you for the keys!
Remember, the exemption applies, of course, only to equity. If your car is worth $10,000 and you owe 10,000 or more on it, there is no equity. However, if you owe $10,000 on a $20,000 car, then you have $10,000 equity. Since your exemption is only $4,000 the car would have equity available to the trustee to take and sell. The trustee would sell the car for $20,000, pay the loan of $10,000, pay you $4,000, and then have $6,000 to apply to your debt.
These are just the highlights of the personal property issues that arise in bankruptcy. The official form lists over 20 separate categories of property that must be disclosed as well as a catchall provision for any other property not listed in a category.
Form 106 Schedules DE and F
These schedules contain a list of all of the creditors that you have the time or cases filed.
Is where you are required to list priority creditors, typically tax creditors
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How To File A Bankruptcy With No Money
Filing for bankruptcy almost seems like a contradiction in terms to file, you must pay a filing fee and attorneys fees. But youre filing for bankruptcy in the first place because you dont have enough money to pay your bills. How can you file for bankruptcy with no money? First: schedule a free consultation with a Cleveland bankruptcy lawyer. That way, you can learn how to make your bankruptcy affordable.
Currently, the fee to file for a Chapter 7 bankruptcy is $335, and the fee to file for Chapter 13 bankruptcy is $310. In some cases its also necessary to pay your attorney up front because attorneys fees can become part of a bankruptcy estate and therefore may be discharged in bankruptcy, leaving them little to nothing in the form of payment. However, some fees can be spread out over the time it takes to obtain a bankruptcy.
But you should consider how much money you can save by hiring legal counsel. A skilled bankruptcy attorney knows the ins and outs of consumer bankruptcy law and can handle all administrative aspects of your case. Because your attorney knows what is needed, your case can move quickly through court. Theres no need to wait for years while your debts continue to pile up and your creditors become more demanding. In fact, you could be awarded your discharge, and become debt-free in three or four months.
Go To Court To File Your Forms
When filing Chapter 7 bankruptcy in Ohio, your bankruptcy petition has to be submitted to the courthouse in paper. If youâre not able to go yourself, you can only send someone in your stead if they have a legal right to do so. To save yourself time and aggravation, check in advance to make certain that you are going to the correct courthouse location and that you have all the necessary documentation . Itâs also a good idea to check the hours for the court and confirm there are no specific coronavirus restrictions in place.
Filing Without An Attorney
IMPORTANT: Please read the Termination of the Ninth Amended Clerk’s Notice: Termination of Ninth Amended Public Notice of Ninth Amended General Order 20-03 Temporary Filing Procedures on September 30, 2021regarding filing procedures during the COVID-19 outbreak.
Filing a bankruptcy case can be difficult, therefore, debtors are strongly encouraged to seek the advice of a licensed attorney. Corporations and partnerships are required to have an attorney. However, individual filers, commonly referred to as “pro se,” may represent themselves. Pro se debtors and creditors must be familiar with and adhere to all bankruptcy rules and procedures, and will not be provided legal advice by the court. Failure to follow the appropriate rules or procedures could result in the dismissal of the bankruptcy case, or significant time addressing improper filings.
Will I Lose My Belongings If I File Chapter 7 Bankruptcy Understand Ohio Bankruptcy Exemptions
Bankruptcy exemptions protect the equity in your property in a bankruptcy case. Likewise, property not protected by bankruptcy exemptions may be sold in a Chapter 7 liquidation case. Note also that for Chapter 13 cases, non-exempt equity in the property can increase the bankruptcy plan payment.
The most important asset most people like to protect is their home. See the Ohio bankruptcy homestead exemption below.
The homestead exemption is often broken down by age and whether you are married.
Single and under 65: $145,425
Single is 65 or older: $145,425
Ohio specific homestead bankruptcy exemption text: “Real or personal property used as residence to $145,425 ”
It is important to review additional Ohio bankruptcy exemptions and choose those exemptions that best protect your assets.
The federal bankruptcy exemptions are detailed in 11 U.S. Code §522. The National Consumer Law Center maintains a list of federal bankruptcy exemptions on its website. Ohio is a state that does not allow you to use federal bankruptcy exemptions
Always check that you use the most current information available when analyzing bankruptcy exemptions.
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Mandatory Credit Counseling For Chapter 7 Bankruptcy
Everyone who files a Chapter 7 bankruptcy, even if you are filing Chapter 7 bankruptcy yourself, has to complete a mandatory credit counseling course. Many of these courses are found online and are not very expensive. The typical costs for credit counseling courses are around $25. Some providers might even reduce or waive the fee.
The mandatory credit counseling course for Chapter 7 bankruptcy must be completed before you file your petition. Failure to follow this requirement will result in your case being dismissed by the Court.
The debtor education counseling course will provide you with a certificate of completion, which you will file with the Court.
A list of approved counseling agencies can be found here:
Unemployment And Bankruptcy: What You Need To Know
Since COVID-19 has made its way into America, the Ohio Department of Job and Family Services has paid out nearly $32 million to 105,000 claimants of unemployment. In one week, the state had more than 185,000 files for unemployment. With the novel coronavirus still wreaking havoc across the nation, theres no way to know when many Americans will get back to work. This is obviously a large problem for the total economy. But what happens if you are someone who has been laid off because of COVID-19 and you were also filing for bankruptcy?
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Don’t Drain Your Retirement Account
You can protect most retirement funds in bankruptcy. Therefore, one of the most unfortunate financial mistakes that people regularly make before filing for bankruptcy is withdrawing retirement funds to pay off a debt that bankruptcy could wipe out.
Before paying off bills in this manner, speak with a knowledgeable bankruptcy attorney. You’ll likely find yourself in a much better financial situation if you file for bankruptcy before depleting your nest egg.
Get Your Free Case Evaluation
If you have further questions about protecting your house through the bankruptcy process, contact any of our convenient Ohio offices by calling . Offices in Columbus, Cleveland, Akron, Youngstown, Canton and throughout Ohio. Someone is available six days a week to discuss your options.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
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Will Filing Bankruptcy Stop Collections Foreclosure And Repossessions
Yes. When you initially file Chapter 7, it will immediately put a stay, or hold, on current debt collections. That means it will stop creditors from the following activities:
- Collections calls, emails, mailing
- Bank account drafting
Your Chapter 7 bankruptcy lawyer will handle your creditors and correspond with any collections agencies who try to contact you. If they continue to call, give them your attorneys contact information. Creditors may not continue to pursue payment after you file Chapter 7 bankruptcy.
Northern District Of Ohio Requirements
The Northern District of Ohio includes five separate divisions, located in Akron, Canton, Cleveland, Toledo, and Youngstown. It is located in the northern half of the state and covers forty of the stateâs eighty-eight counties. Forms for the Northern District of Ohio can be found on the courtâs website.
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How Do I Pay The Fees And Costs
In a Chapter 7 case, all fees and court costs must be paid prior to the time that the petition is filed with the court. Any other arrangement, such as an agreement to make payments after filing, must be discussed with a Borders and Gerace Attorney. If payment of these funds all at once presents a problem, one possibility is to make payments over time prior to filing. Once you have paid a retainer amount that we agree on, you may advise your creditors that you have retained an attorney. Our office will confirm this with your creditors, and attempt to slow down their collection attempts hopefully, long enough to enable you to gather all the necessary funds in order to file.
As indicated above, most of the fees in a Chapter 13 typically are paid as part of your plan payments. As you pay the trustee on a monthly basis, the trustee will pay the legal fees over a period of time.
Payment of the legal costs can be paid by cash, money order, check, or debit from your checking account.
What about using a credit card to pay the legal costs? We probably do not even need to mention that if you are filing a bankruptcy petition you should not use your credit card to pay for the cost of filing. However, if you have a relative or friend who is willing to help you with the expense by using his or her credit card to give you the necessary amount, this is fine.
Exemptions Allowed For Chapter 7 Bankruptcy
Common exemptions as defined by Ohio Revised Code 2329.66 include:
- Homestead exemption Up to $136,925 home equity value
- Motor vehicle exemption Up to $4,000 in one vehicle
- Wildcard exemption Up to $1,325 for any property of your choosing
- Cash Up to $500 on hand or in deposit accounts
- Household goods Up to $13,400 in furniture, appliances, etc.
- Jewelry Up to $1,700 in equity total
- Personal injury award within 12 months of bankruptcy filing Up to $25,175
- Tools of trade Up to $2,550 in value
- Benevolent society death benefits Up to $5,000
In addition to these specifical monetary amounts, Ohio allows certain exemptions with any value, including the following:
- One burial lot
- Crime victims compensation received within 12 months before filing
- Disability payments
- Earned income credit and child tax credit
- Unemployment compensation
- Life insurance
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How Much Does It Cost To File Bankruptcy In Ohio
Attorneys fees in bankruptcy vary by region of the country. And large cities the cost of filing cases higher, and rural areas where overhead is lower, the fees are more reasonable. As a general rule, the cost of Chapter 7 bankruptcy in Ohio will usually range between $900 and $1,500.
Keep in mind though that this is just a ballpark figure, the cost of bankruptcy will vary by complexity of the case. In addition, there is a $335 filing fee to proceed with Chapter 7 however, in cases of severe financial hardship, debtors can ask that the fee be waived or paid in installments. Similarly, bankruptcy attorneys are used to helping families who find themselves struggling with that and most firms offer some type of payment plan so that their clients can afford to pay their fee.
Official Form: 106 Personal Property
The bankruptcy petition includes a long and detailed list of different categories of personal property that must be listed. Some of the property is self-explanatory. Some are not.
It is mandatory to list any cash on hand, including cash kept at home safely or in a safe deposit box. Bank balances on the date of filing must be listed, and proof of the amount in the account provided to the trustee. Checks that have been written but not cleared may not count in most cases. Money owed to you must be disclosed even if you dont expect that youll ever be able to collect it.
Household goods and furnishings have to be listed in enough detail so that the trustee can determine whether or not an exemption protects each item of property that you own. Therefore, there should be a detailed listing, along with the current value of the property as well.
Books, pictures and art objects, coin collections, and other collections must be disclosed along with their current value. Sometimes, its appropriate to get an appraisal for these items if necessary or helpful to accurately understand their value.
Firearms sports equipment and other hobby equipment must be listed with the current resale value. Firearms often get special attention from trustees because the values of these items have increased recently.
Annuities and Retirement Plans.
Stocks bonds and interest in business.
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What To Expect When You Meet With Our Firm
You will meet one-on-one with an attorney. We will discuss your debts, assets, income and relationships in order to find a solution to your financial problems. We are one of the largest bankruptcy filers in southern Ohio, but meeting with us does not necessarily mean you are going to file for bankruptcy. Meeting with us means youll receive professional advice about how best to deal with your debts. We will only recommend bankruptcy where we believe it is the best solution for you and your family based on the totality of the circumstances.