Other Requirements For Chapter : Debt Counseling
Before filing for Chapter 7 bankruptcy, you must be aware of other requirements you must fulfill. During the six months before you file, you must complete credit counseling provided by a federally approved organization. This has to be done before you file, but it cannot be more than six months old, so timing is important.
After you file, you must complete a second educational requirement. You must go through a personal financial management course, which will help you manage money and avoid obtaining too much debt in the future. This course is sometimes called a debt management course or pre-discharge debtor education course.
For both of these requirements, there are a few exceptions. If you are worried about being able to complete these counseling sessions, talk with an Arkansas Chapter 7 bankruptcy lawyer located in Fayetteville.
Arkansas Bankruptcy Process How To File Bankruptcy In Arkansas
2005 Bankruptcy Act Credit Counseling The 2005 Bankruptcy Act requires all individual debtors who file bankruptcy on or after October 17, 2005, to undergo credit counseling within six months before filing for bankruptcy relief and to complete a financial management instructional course after filing bankruptcy.
2005 Bankruptcy Act Means TestUnder the 2005 Bankruptcy Act your income and expenses will be analyzed to determine if you qualify to file a Chapter 7 or if you must file Chapter 13. To apply the means test, the courts will look at the your average income for the 6 months prior to filing and compare it to the median income for Arkansas. If the income is below the median, then you may choose Chapter 7. If your income exceeds the median, the remaining parts of the means test will be applied to determine if you can file Chapter 7 or if you must file Chapter 13.
Gathering PaperworkTo begin the bankruptcy process you must itemize your current income sources; major financial transactions for the last two years; monthly living expenses; debts ; and property . You should also collect your tax returns for the last two years, deeds to any real estate you own, your car titles, and the documents for any loans you may have.
The cost for filing a Chapter 7 bankruptcy is $306. This fee may not be waived but you may be able to pay it in installments. The fee of $281 for a Chapter 13 bankruptcy cannot be waived.
File Your Bankruptcy Petition With The Court
Each case and bankruptcy filing is unique, but in general, you will submit the following materials when filing for bankruptcy in Arkansas:
- A check to cover the cost of filing fees
- Voluntary petition
- All disclosures and schedules
- Evidence of all claims contained within
Your attorney will prepare your bankruptcy package on your behalf. If you are filing your bankruptcy without an attorney, you must submit the required materials through Public Access to Court Electronic Records . All personal data identifiers should be removed from your files.
Where Do I File For Bankruptcy In Little Rock Ar
Where to file your bankruptcy case depends on where you live and on whether you have a business close to home. Usually, you’ll file in the federal district court closest to where you’ve lived for the past 180 days . But if you run a business in a different district and most of your property is located there, you may have to file in the federal court serving that location.
The reason behind these filing rules is that the bankruptcy court wants the person overseeing your caseâcalled the bankruptcy trusteeâto be able to easily find, evaluate, and, if necessary, sell your property.
If you’ve moved recently, you may have to file at the bankruptcy court serving the county where you used to live. That will depend on where the greater portion of your property has been for most of the past 180 days. For example, if you lived in Oregon for most of your life, but moved to California a month ago, you’ll file in Oregon because you lived there for 150 of the past 180 days.
You can handle most interactions with the court, including filing your bankruptcy forms, by mail. However, you will need to visit the courthouse in person at least once, for a meeting with the bankruptcy trustee.
What Is The Process To File For Bankruptcy In Arkansas
Consumers can file for bankruptcy under Chapter 7 or Chapter 13.;
- Chapter 7 bankruptcy requires you to liquidate your non-exempt assets, but does not require any payment plans to creditors.
- Chapter 13 bankruptcy allows you to keep most of your assets, but you must repay your creditors totally or partially for your debts.
Regardless of the filing chapter, here are the 3 steps you must take when filing for bankruptcy in Arkansas:
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Us Trustee Program Extends Telephonic Or Video Section 341 Meetings
The U.S. Trustee Program has extended the requirement that section 341 meetings be conducted by telephone or video appearance to all cases filed during the period of the Presidentâs âProclamation on Declaring a National Emergency Concerning the Novel Coronavirus Disease Outbreakâ issued March 13, 2020, and ending on the date that is 60 days after such declaration terminates. However, the U.S. Trustee may approve a request by a trustee in a particular case to continue the section 341 meeting to an in-person meeting in a manner that complies with local public health guidance, if the U.S. Trustee determines that an in-person examination of the debtor is required to ensure the completeness of the meeting or the protection of estate property. This policy may be revised at the discretion of the Director of the United States Trustee Program.
Pros And Cons Of Bc Bankruptcy
Most people who cant afford to pay more of their unsecured debt would find bankruptcy as the most efficient way to eliminate it. If you dont stand a chance to cover all your payments, bankruptcy frees you from your indebtedness and enables you to have a fresh start without wiping all your assets. Besides, financial counseling for bankrupt individuals aids to prepare a person to get back on track and efficiency manage finances. Furthermore, creditors and debt collectors will have to obey an automatic stay of proceedings. This order allows you to get paramount creditor protection.
On the contrary, bankruptcy can also cost you money. You will have to make bankruptcy payments according to your income and may be required for administrative fees. Moreover, bankruptcy yields a significant impact on your credit rating. For BC residents, this remains for 6 years and will be extended for 14 years for the second time. Besides, bankruptcy may cause you to lose any of your non-exempt assets. However, there are still assets you can keep. Few of the things that you may surrender are as follows:
- the net value of vehicle equity in excess of $5,000
- Principal residence equity in excess of $12,000 , and $9,000 anywhere else in British Columbia
- household items such as furniture and appliances less $4,000
- Owned tools for work or business valued over $10,000
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What You Can Keep In A Chapter 7
Everyone who files a bankruptcy case, whether it is a Chapter 7 or chapter 13 bankruptcy, is required to list all of their assets, which is any interest they have in real and personal property. But do not fear! The bankruptcy laws protect your assets from creditors. There is a limit on the amount protected, but most folks fall well below that limit. This means that the individual can wipe away debt, which in bankruptcy is called discharging debt, and keep their property. You might have property that is collateral for a loan, like a mortgage on your house or a car loan. Again, no worries! In most cases, you can keep and continue to pay for those items.
It is also important to know that in many cases your retirement accounts are protected in full. So do not use your retirement to pay off debt that you might be able to discharge before talking to someone who can tell you how the laws protect you.
This is just a sample list of some of the property that is protected and that you keep if you file a Chapter 7 bankruptcy case:
- Wrongful death awards and personal injury awards
- Public assistance, Social Security, disability benefits, veterans benefits, and unemployment compensation benefits
Regardless of what you may have heard, Chapter 7 Bankruptcy laws clearly do not require you to surrender all your property, leaving you destitute. You are usually able to keep everything you need to continue on with your normal lifestylejust without the debt.
The Basics Of Chapter 7 Bankruptcy
Whether due to an unexpected job loss, a medical event, a court judgment, or other change in economic circumstances, a person will find that he or she is no longer bringing in enough income to pay his or her bills. This economic condition, in which the money coming in is less than the amount going out to pay debts, is called insolvency. When a person becomes insolvent, he or she may consider bankruptcy as a way to deal with this overwhelming debt and get a fresh start.
In the bankruptcy system, a person filing for bankruptcy protection is called the “debtor,” For the vast majority of individual debtors, there are two types of bankruptcy filings, those filed under Chapter 7 of the bankruptcy code and those filed under Chapter 13 of the bankruptcy code. These two types of bankruptcy are quite different, have different requirements for filing, and are designed to meet different goals.
A bankruptcy filed under Chapter 7 is designed to discharge the outstanding debts of so called “honest debtors” and allow them to start fresh free from the quagmire of overwhelming debt. In a Chapter 7 bankruptcy, the Trustee will sell the debtor’s nonexempt property and distribute the proceeds from that sale to the debtor’s creditors. Most of the remaining debt is then discharged, that is, the debtor has no liability to repay it.
Chapter 7 Bankruptcy Eligibility Requirements:
Other requirements for Chapter 7:
How Chapter 7 Works:
The Automatic Stay:
The Chapter 7 Discharge:
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What Is Chapter 7 Bankruptcy
Chapter 7 bankruptcy is one of the most common types of consumer bankruptcy. Consumer means it is for individuals, but not businesses.
Through a Chapter 7 bankruptcy, all or most of your unsecured debt is paid or discharged. These unsecured debts typically include credit card balances, medical bills, and other personal loans.
Your secured debts and many others, including your mortgage, auto loans, and student debts are not automatically forgiven. During a Chapter 7 bankruptcy, you may need to sell your home to take care of your mortgage debt. You may need to sell off a vehicle. Other secured debts remain behind and must still be paid. One of the most common debts that is not typically discharged in bankruptcy are federal student loans. However, there are exceptions to all of these, and this is where an experienced attorney can help.
You may wonder how the unsecured loans are paid. After you file for bankruptcy, you will be assigned a bankruptcy trustee. This person will determine what assets you have, and then will decide which of your assets are exempt property and which are not. The assets that are not exempt will be liquidated. This means they are sold, and the proceeds are used to pay as much of your debt as possible. This process is why Chapter 7 is known as a liquidation bankruptcy.
Print Your Bankruptcy Forms And Bring Them To Court
Once you have prepared your bankruptcy forms, you will need to print them out for the court. You must print them single-sided. The court wonât accept double-sided pages.
You will also need to sign the forms once they are printed.
Most bankruptcy courts require just 1 copy of the petition, but some courts like the bankruptcy court in Manhattan require 4 copies. So call your local bankruptcy court to find out how many copies you will need to bring.
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Determine Whether To Hire An Attorney To File Bankruptcy
Once you understand the cost, you can now determine whether to hire an attorney to file bankruptcy. Most attorneys will send you a retainer agreement that will outline the terms of the engagement. You will most likely need to submit information like pay stubs and tax returns for them to file the bankruptcy petition.
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Protecting Your Exempt Property
If you file for Chapter 7 bankruptcy, the bankruptcy trustee assigned to your case may sell your property to pay your debts unless the law specifically allows you to keep all or a part of it. The property youâre allowed to keep is called your âexempt property.â For example, exemptions may allow you to keep at least some of the equity in your home, a car, and personal property such as your clothes and household goods.
Bankruptcy exemptions arenât automatic. You must figure out what is exempt and list that property on your bankruptcy forms, along with the specific laws that allow you to claim the property as exempt. Exemptions are determined by state law; some states have their own exemptions, while others allow you to use the exemptions provided by the federal bankruptcy code.
For more information on Arkansas law, see the Exemptions section of this website.
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Get The Answers You Need
Still have questions about how bankruptcy will affect your financial situation? Were here to help. Download our;free Bankruptcy FAQ PDF to find the answers to other common questions about filing bankruptcy. We can review your records and help you determine if bankruptcy is the right solution for you.
*We are a debt relief agency. We help people file for bankruptcy relief under the bankruptcy code.*The No Fee Guarantee®;does not apply to bankruptcy cases.
Arkansas Legal Aid Organizations
These organizations provide free legal aid in Arkansas to individuals and families that cannot afford a lawyer. Even though you don’t have to have a lawyer to file your Arkansas bankruptcy, if you are more comfortable having one by your side but can’t afford to hire a lawyer, they may be able to help. You should contact the Arkansas legal aid organizations near you to find out if you are eligible for assistance for your Chapter 7 bankruptcy in Arkansas.
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Mandatory Debtor Education Debt Management Course
$0 to $75
As if you don’t have enough hoops to jump through, when you’ve completed all the other parts of your bankruptcy, you still don’t get that magic piece of paper called the “discharge” until you complete a course in debt management.
This is yet another requirement motivated by Congress’s frequently mistaken assumption that people who file for bankruptcy wouldn’t be broke if they weren’t so careless with their money. Chances are, you really are brokeâand not because you’re irresponsibleâso you should see if you qualify for free or reduced rates.
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Alternatives That Might Also Work Well For You
Chapter 7 may be the simplest way to obtain relief from your debt, but it is not for everyone. For some individuals and families find that a Chapter 13 bankruptcy is a better choice. One situation where you might prefer Chapter 13 is if youve fallen behind on your home mortgage payments or car note. Chapter 13 will immediately stop threatened foreclosure and repossession and will give you time to catch up on payments. Your Arkansas bankruptcy attorney will discuss the pros and cons and the qualification requirements for each.
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What Is A 341 Hearing
Everyone who files for bankruptcy must attend a 341 hearing, which is also called a “creditors meeting.” The meeting is conducted by the bankruptcy trustee assigned to your case. The trustee will put you under oath and may ask you questions about the information you’ve provided on your bankruptcy forms. Creditors may also show up at the hearing to ask you questions, but it’s not common for them to do so.
Bankruptcy law also requires the trustee to ask you questions to be sure you understand how bankruptcy works and the potential consequences of filing bankruptcy, such as the effect on your credit record.
For most bankruptcy filers, this will be your only trip to the courthouse . Most court websites post schedules of 341 hearings, and when you file, you will be notified of your hearing date. When you show up for your hearing, you will find that many other people have hearings set for the same day. You will sit and wait for your name to be called–usually in a room somewhere in the courthouse or federal building, but probably not in a courtroom.
Bankruptcy Forms For Greenwood Arkansas
There are about 23 federal forms involved in a bankruptcy filing, not including the local and optional forms that you might need for your case.
The Petition is a series of different forms that outline your financial resources and obligations. It is how you show that you are unable to make ends meet. At filing, you will need to present a few other documents including your certificate of financial counseling, your redacted tax returns and pay stubs.
For a comprehensive overview of the voluntary petition, A/B, C, D, E/F, G, H, I, J, or other forms read the Arkansas guide for bankruptcy forms. Below are details for state and local unique forms.
If you feeel overwhelmed or want assistance, check out Upsolve’s free bankruptcy assistance and see if youâre a good fit for our service. We have a free service that makes the bankruptcy process super simple for residents of Arkansas.