Once you have reviewed and signed your Chapter 7 bankruptcy petition, all that remains is filing the documents with the bankruptcy court. But what should you expect next, now that you have filed? Below, we explain what happens after filing Chapter 7 and how a Charlotte NC bankruptcy attorney can help you navigate the process. To learn more, contact the Law Office of Jack G. Lezman, PLLC today.
What Happens Immediately After You Have Filed For Bankruptcy?
Immediately after you have filed for bankruptcy, the court will provide you with a case number and notify your creditors. It will also assign a Chapter 7 trustee to your bankruptcy case.
Your Chapter 7 trustee will administer all of your assets, which will make up your bankruptcy estate. They will have a large role in your bankruptcy. They will make sure all your filed paperwork is complete and decide whether your property is sold or not.
At this time, you will benefit from an “automatic stay” that goes into effect once your bankruptcy is filed. This prevents your creditors from contacting you to collect on your debts. Thus, it stops wage garnishment, foreclosure proceedings, enforcement of liens, and debt collection lawsuits while your case is in process.
Attending the Meeting of Creditors
The court will schedule a “meeting of creditors” (also referred to as a “341 meeting”) 30 to 45 days after filing your case. This will most likely be your only appearance in court for your bankruptcy. Prior to the meeting, you will need to send the trustee your tax returns, bank statements, and pay stubs.
The trustee will conduct the meeting of creditors. They will swear you in and ask you questions about your assets and the paperwork you have submitted. They will want to know the details of your bankruptcy petition and your financial situation.
While creditors are notified of the meeting and allowed to attend, they rarely come. Creditors may show up if they are hostile or believe you have committed fraud in seeking bankruptcy protection.
Your meeting may not take long if you don’t have a lot of assets. However, you will probably have to wait up to an hour as your case will be among many that will be heard at the same time.
After the Meeting of Creditors
The trustee will determine which of your property will be sold to pay the debts you owe to creditors. They will then liquidate the assets and sell them. Some of your property will be sold while others will be available for you to pay their cash value. If you have no non-exempt property, the trustee will report that to the court.
At this time, your creditors may send you reaffirmation agreements. These bind you to paying off your secured debts, such as houses and cars, after your bankruptcy is closed. In exchange, you retain these secured debts. These agreements must be signed by you and your creditors before you receive your discharge.
What Happens at the End of Your Bankruptcy?
After your meeting of creditors, you must take a personal financial management course prior to a discharge of your debts. This is different from the credit counseling you received prior to filing for bankruptcy.
The sooner you take this course after your meeting of creditors, the better. You do not want to have your discharge delayed longer than the 90 days from filing it typically takes. If you are like most filers, 90 days will pass before your bankruptcy discharge is issued. This is because creditors have 90 days to object to a bankruptcy filing and rarely object.
Once you receive your discharge, you have what you have been seeking through bankruptcy. Your dischargeable debts are forgiven and you can now start fresh financially.
What Happens After Your Bankruptcy Discharge?
After your bankruptcy discharge, you can start rebuilding your credit. Contrary to popular belief, a bankruptcy will not tarnish your credit forever. Some have even purchased homes several years after filing using special credit cards and bank accounts to reestablish credit scores.
It is possible that your bankruptcy case remains open after you have received a discharge. For example, your trustee could continue to investigate or sell your assets after your discharge.
Following discharge, your credit reports should show that you no longer have any debts. You should review your credit reports a month after your discharge to ensure this is reported correctly. If a credit report has not been updated, you should dispute it with the credit bureau responsible for the report.
Speak to a Charlotte NC Bankruptcy Attorney Today
If you’re wondering what happens after filing Chapter 7, speak to an experienced Charlotte bankruptcy attorney at The Law Office of Jack G. Lezman, PLLC. We can help you through the bankruptcy process and make sure you avoid costly mistakes. Contact us today.