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The Logistics of Bankruptcy
by Adam Mack
If you're considering filing bankruptcy in Kansas, it's helpful to know what to expect in terms of logistics. In this post, I'll take you step-by-step through an average bankruptcy.
Step 1: Retain an Attorney
Not just any attorney will do - find a qualified Kansas bankruptcy attorney who is a good fit for your needs. Don't be afraid to shop around for pricing, qualifications, or even personality. Your bankruptcy is a major investment in your own future, and you deserve to have a legal partner you're confident in and comfortable around.
With only rare exceptions made under extenuating circumstances, the first time I meet potential clients is in a face-to-face free initial consultation. That "meeting" usually lasts between an hour and a hour and a half and we discuss their financial situation and long-term financial goals. If the potential clients decide that bankruptcy is the option they wish to pursue and that I'm the man for the job, we sign a retainer agreement and begin the process of collecting documents. Because of the requirements and nature of bankruptcy law, we are required to have the fee paid before we file your case, but we will get started on the prep work of your case with no money down. On the other hand, if it's a chapter 13 bankruptcy, no payments are necessary at that time and we can file your bankruptcy with no money down.
Step 2: Take the Pre-Filing Bankruptcy Course
With the passage of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, the pre-filing course became a mandatory part of filing bankruptcy. Fortunately, the class can be taken at your convenience either online or over the phone. Unfortunately, it takes about an hour to complete.
Step 3: Prepare the Petition
The courts require a lot of information from anyone filing bankruptcy, and they want documentation to back it up. Basically, you'll need to provide documentation about your entire financial life, including (but not limited to) proof of income, financial statements from your bank or credit union, lists of creditors, lists of assets, information about dependents, tax returns, even your driver's license (or other government ID) and Social Security card. Fortunately, we're here to help you know what to gather and can even help you obtain some documentation you might be missing (like tax records from previous years).
Once all those documents have been gathered, your attorney can move forward with preparing your bankruptcy petition. Upon completion, the petition is then filed with the court and the automatic stay is in place.
Step 4: "341 Meeting"
This is typically the only hearing you have to be present for - an attorney can represent you elsewhere if need be. In this meeting, you answer a series of questions about your bankruptcy under oath.
Step 5: Comply with the Bankruptcy Code/Court
Once the bankruptcy petition has been filed with the court, the trustee is assigned to your case and begins to work on it. Based on the information provided in your filing and gathered at the 341 meeting, the trustee will identify any nonexempt assets and gather these assets into the bankruptcy estate, liquidate (sell) the assets, and then distribute the value of those assets to creditors.
If the trustee requires any additional documentation (and they usually do), you'll need to provide it in a timely manner. Your creditors might take action during this stage, too, by filing a motion with the Court requesting relief from the automatic stay (which allows them to resume debt collection/enforcement efforts if granted). It's critical to have an attorney at your side during this step who can deal with these motions or other court filings.
Step 6: Discharge
In a chapter 7 , discharge is effectively the final step for most of my clients. The court will enter a final order and send you a discharge letter and your bankruptcy case is officially closed by the court at a later date. In a chapter 13, the discharge is a contingent one dependent on you exactly performing every duty in the Plan, including making all of your proposed payments. The Plan usually lasts 3-5 years, at which point the discharge is granted upon the completion of the plan.
The Most Important Part
Finding a qualified Kansas bankruptcy attorney who is a good fit for you will make every step of your bankruptcy better - easier, quicker, and more comfortable.