Bankruptcy Process And Outcomes
There are several steps you must take when you have decided to make yourself bankrupt. While instructing a solicitor is notnecessary, the ISI considers it advisable to get professional legal advice inadvance of declaring yourself bankrupt or defending any bankruptcy proceedings.The Irish Mortgage HoldersOrganisation provides a free service in relation to bankruptcy.
The process is summarised below:
- Lodge 200 with the Official Assignee
- Complete your petition, which must be verified by a sworn affidavit and a sworn statement of affairs
- File the relevant bankruptcy application documents in the Examiners Office
- Attend the court hearing on the date given, where the judge, if satisfied, will adjudicate you bankrupt
- Meet the Official Assignee or Bankruptcy Inspector to be interviewed about all your assets and debts
- Place a notice of your adjudication as a bankrupt in Iris Oifigiúil
- Place a notice of your adjudication as a bankrupt either on the ISIs website or in a national daily newspaper
Before 2016 a statutory High Court sitting was also required, but thisrequirement was removed by the Bankruptcy Act 2015.
Restrictions On People Who Have Been Declared Bankrupt
Once you have been declared bankrupt, you will be guilty of an offenceif:
- You do not disclose the bankruptcy when getting a loan or any other credit facility of 650 or more
- When trading in a name other than that in which you were made bankrupt, you do not disclose the bankruptcy
- You act as a director, manager, auditor, liquidator or receiver of a company without permission of the court
These offences carry a maximum penalty of 5 years in prison and a fine of1,270.
Other consequences of bankruptcy are:
- If you wish to travel outside the State, you should tell the Official Assignee. You may be arrested if it seems to the High Court that you are leaving the State in order to avoid the consequences of your bankruptcy.
- You cannot be granted an enduringpower of attorney on behalf of someone else, and if you hold one already, it is automatically revoked if you become bankrupt.
- Under the Charities Act 2009, you may not be a trustee of a charity if you are adjudicated bankrupt.
- Some professional bodies disqualify members who are adjudicated bankrupt
Bankruptcy Exemptions In Manitoba
- Furniture and household appliances up to $4,500
- No limit on clothing for you and your family
- Food and fuel necessary for you and your family for six months, or the cash equivalent
- Tools of your trade up to $7,500
- One motor vehicle up to $3,000 when used for business or transportation to work
- Articles and furniture necessary to perform religious services
- No limit on health aids for you or your family
- If you are the sole owner of your home, up to $2,500 in equity is protected if you co-own your home, the limit is $1,500
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When A Company Files A Chapter 11 Bankruptcy It Can Have A Plan Approved That Discharges Its Debts Once The Plan Is Confirmed As Long As The Company Continues In Business
How long to file bankruptcies. A similar approach is to file a chapter 13 case immediately after receiving a chapter 7 discharge . Know how much time you have until youre in the clear. That time period starts on the date you file the bankruptcy petition.
You can either go bankrupt voluntarily, or a lender can make you bankrupt if you owe £5000 or more and you havent agreed a way to pay. Chapter 13 and chapter 7 bankruptcies are very different for businesses. The public record associated with a chapter 7 bankruptcy will remain on your credit report for as long as 10 years.
After a year, you are discharged. Bankruptcy law does not limit the number of times a person can file only the amount of time between filings. Chapter 13 allows the proprietorship to stay in business and repay its debts and chapter 7 does not.
Since you are placed on a repayment plan, a new chapter 13 case can be filed in as little as two years. Not only is the filing process quick, but unlike a chapter 13 bankruptcy , qualified debtors don’t make monthly payments to creditors over. Bankruptcies usually last for 12 months, and youll have many financial restrictions during this time.
Featured in forbes 4x and funded by institutions like harvard university so we’ll never ask you for a credit card. How long does it take to file for bankruptcy? 5 minute read upsolve is a nonprofit tool that helps you file bankruptcy for free.
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When Can I Start To Build Credit Again After Bankruptcy
You can begin to rebuild your credit as soon as you are discharged from your bankruptcy. This signals to lenders that you can manage your finances and are creditworthy.
You can apply for a credit card after you have been discharged from bankruptcy. Your financial institution may require that you apply for a secured credit card. With a secured credit card, you have to put down a deposit on the credit card amount. After paying your balance regularly for a period of time determined by your financial institution, you can get your deposit back and apply to have an actual credit card. The decision to give you a credit card is made by the bank or other company issuing the credit card.
Additionally, after your discharge, you should review your credit report and address any errors. For example, any debts discharged during bankruptcy cannot be reported on as debts you still owe, or are outstanding, etc. If they appear on your report, you should contact the credit agency and have them correct the information. Going forward, you can check your credit report on a yearly basis.
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Know How Much Time You Have Until Youre In The Clear
When consumers file for bankruptcy, they usually want the process to be over and done with as quickly as possible. After all, the sooner you complete the process, the faster you can get started rebuilding and moving forward with a fresh start.
Unfortunately, filing for bankruptcy doesnt mean your troubles are over in a snap. Even with Chapter 7 bankruptcy, which is generally the faster type of personal filing, its going to take some time.
The answer below can help you estimate how long you have on the road ahead, but if you need to file and have questions, you should talk to a professional. That way, the estimates they give you can be based on the specifics of your situation, so you know you have an accurate timeline. Call us or complete the form to get started.
How Does Chapter 7 Bankruptcy Affect My Existing Mortgage
When you file Chapter 7, your existing property will be deemed either exempt or nonexempt. Exempt means youll be able to keep the property throughout the bankruptcy process, as long as you can catch up and stay current on your payments.
Nonexempt means you will either be required to surrender the property or pay its value in cash as a part of the bankruptcy. In some cases, people are allowed to keep nonexempt properties. It all depends on the bankruptcy trustee and how they choose to handle the property.
To understand how Chapter 7 impacts your existing home mortgage, you must first understand the difference between a loan and a lien.
When you get a mortgage, your mortgage company gives you a loan. They let you borrow money in order to buy a property. When they do that, they place a lien on the property. A lien is a right or interest in the property that the mortgage company has until the debt is paid in full.
When you file Chapter 7, you are no longer legally obligated to repay the loan. Legally obligated is the key phrase here because Chapter 7 does not get rid of the lien on the property. Your lender still has a right to the property if the debt is not paid.
So basically, you dont have to pay your mortgage. But if you dont you will lose your property because your lender will likely enforce the lien they have. If you are able to keep your home as part of Chapter 7, its probably a good idea to do everything in your power to keep paying your mortgage loan.
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When Does The Discharge Occur
The timing of the discharge varies, depending on the chapter under which the case is filed. In a chapter 7 case, for example, the court usually grants the discharge promptly on expiration of the time fixed for filing a complaint objecting to discharge and the time fixed for filing a motion to dismiss the case for substantial abuse . Typically, this occurs about four months after the date the debtor files the petition with the clerk of the bankruptcy court. In individual chapter 11 cases, and in cases under chapter 12 and 13 , the court generally grants the discharge as soon as practicable after the debtor completes all payments under the plan. Since a chapter 12 or chapter 13 plan may provide for payments to be made over three to five years, the discharge typically occurs about four years after the date of filing. The court may deny an individual debtor’s discharge in a chapter 7 or 13 case if the debtor fails to complete “an instructional course concerning financial management.” The Bankruptcy Code provides limited exceptions to the “financial management” requirement if the U.S. trustee or bankruptcy administrator determines there are inadequate educational programs available, or if the debtor is disabled or incapacitated or on active military duty in a combat zone.
How Long Does It Take To File A Chapter 7 Bankruptcy Case
There are a few things youâll have to do before you can file bankruptcy. How long this takes depends entirely on how quickly you move through the steps. Some people take weeks or even months to get ready others get it done in the span of a week. Hereâs a breakdown of these pre-filing steps:
Gathering information: Youâll need to collect some documents, like your tax returns and paycheck stubs so you can submit them to the court and/or the trustee. But, youâll also need to have information about how much you spend on living expenses, what your assets are and how much theyâre worth.
Taking credit counseling: This course has to be completed in the 180 days before your bankruptcy petition is filed with the court. It usually takes only 1 hour.
Completing the bankruptcy forms: This is often the longest part of the process. Folks working with a law firm wait for the lawyerâs office to complete this step. Once done, they’ll meet with the bankruptcy lawyer to sign their forms. Folks filing on their own can take several hours to fill out the bankruptcy forms. Upsolve users typically take a total of about 3 hours to provide the information needed to generate their forms.
Filing the forms with the court: How long this takes depends on whether you go to the bankruptcy court in person or mail it in. Due to COVID-19, some courts have started accepting forms through electronic means, like sending an email or uploading the documents through a portal.
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You Must Attend A Creditors Meeting
About a month or so after you file, you will need to attend a creditors meeting where a trustee will ask about the information you submitted you will have to answer under oath. This meeting is known as the 341 meeting.
Within two months of attending the creditors meeting, you must complete a financial counseling course. After youve received budget counseling, you wait to receive a discharge of your debts from the bankruptcy court.
Many people who file for Chapter 7 bankruptcy can retain all their assets. However, you cannot sell or give away any property without clearing it with the trustee during this time. Most bankruptcy cases generally receive a discharge order from the court about 60 days after the initial creditors meeting.
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Once We Receive Your Application
If we accept your bankruptcy application, we’ll send you and your creditors confirmation in writing. This confirmation contains your AFSA administration number. Your creditors may ask for this.
If we don’t accept your application, we notify you in writing with the reason why.
If you submitted your Bankruptcy Form online you can log back into your account to see the status of your application and, once accepted, your AFSA administration number.
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Bankruptcy Exemptions In The Northwest Territories
- Household furniture and appliances up to $5,000
- No limit on clothing for you and your family
- Enough food and fuel for the next 12 months
- Hunting tools up to $15,000
- Your principal residence up to $50,000
- One vehicle up to $6,000
- Tools of the trade up to $12,000
In Nova Scotia, property exempt from seizure in bankruptcy is set by the provincial government and applies to the equity in an asset. Equity is the difference between the value of the asset and what you owe on the asset.
Example: If you have a car worth $6,000 and you still owe $3,000 on the loan, the equity you have in the car is $3,000. In Nova Scotia, the exemption for a car is $6,500. In this case, you would be entitled to keep the car and unsecured creditors cannot take it from you when you file for bankruptcy.
Which Debts Do I Still Have To Pay After Bankruptcy
Although you will be released from liability to pay most of your debts once you are discharged, there are exceptions to this. Even after discharge you will still be personally liable for:
- magistrates court fines
- arrears of maintenance or maintenance payments ordered by a court
- Child Support Agency and Child Maintenance Service arrears
- debts you built up through fraud and
- debts you owe as a result of a personal injury claim against you.
This is not a complete list of the debts that you will still have to pay after your bankruptcy ends. Contact us for advice.
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Tax Refunds And Bankruptcy In Canada
Question: In your article you said: When you go bankrupt, you lose your tax refund for the year of bankruptcy, and all prior years that are not yet received.
I went bankrupt in July 2011 and provided my 2011 tax refund to the trustee, but now Im being told that I also have to provide my 2012 tax refund because 3 months of my bankruptcy was in 2012.
This doesnt seem to equate with your comments.
Answer: J. Douglas Hoyes, CA, CIRP, Bankruptcy Trustee, the author of that article, responds:
Your trustee is incorrect. Section 67 of the Bankruptcy & Insolvency Act states that:
67. The property of a bankrupt divisible among his creditors shall comprise
all property wherever situated of the bankrupt at the date of the bankruptcy or that may be acquired by or devolve on the bankrupt before their discharge, including any refund owing to the bankrupt under the Income Tax Act in respect of the calendar year or the fiscal year of the bankrupt if it is different from the calendar year in which the bankrupt became a bankrupt,.
In simple terms, you lose your tax refund for the calendar year that you . Providing your tax information to your trustee for the year of bankruptcy is one of the duties you must perform to receive your discharge from bankruptcy.
In your case you declared bankruptcy in 2011, so you lose your tax refund for the 2011 tax year. Your trustee is required to file two tax returns for the year of bankruptcy:
Get Free Advice About Bankruptcy
Its always best to talk things through with an experienced debt adviser before you decide to apply for bankruptcy.
This is because the debt solution is best for you depends on your personal circumstances and might not be this one.
Debt advisers can help you make the right decisions so most of your money will go to paying off your debts, which means you might be debt free sooner than you thought.
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Starting A Chapter 11 Bankruptcy
A Chapter 11 case begins with the filing of a petition in bankruptcy court. Generally, Chapter 11 cases are voluntary and it is the debtor who takes the initiative and seeks bankruptcy relief. Occasionally, however, creditors will band together to file an involuntary bankruptcy petition against a defaulting debtor.
Most debtors file where the business is located, but business debtors can file bankruptcy where they are “domiciled” . For instance, businesses incorporated in Delaware sometimes choose Delaware instead of their home states.
There is no absolute limit on the duration of a Chapter 11 case. Some Chapter 11 cases wrap up within a few months, but it’s more usual for it to take six months to two years for a Chapter 11 case to come to a close.
Speak With A Professional
The U.S. Bankruptcy Court strongly suggests that those filing get an attorney. Court officials, including judges, are barred by law from offering advice to people whove filed for bankruptcy. The court does have information and documents available for those doing it themselves, legally called pro se.
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How Long Do I Have To Wait After Chapter 13 To Get A New Mortgage
Rocket Mortgage and other lenders may give you the option of getting an FHA or VA loan as long as the Chapter 13 bankruptcy is discharged or dismissed before you apply.
If you’re looking to apply for a conventional loan, it matters whether your bankruptcy was discharged or dismissed. In the event of a Chapter 13 discharge, the discharge date has to be more than 2 years prior to the date credit is pulled and more than 4 years since the filing.
If the bankruptcy was dismissed, theres a 4-year waiting period until credit can be pulled for a new conventional mortgage.
Finally, jumbo loans still have a 7-year waiting period before you can apply.