NATIONAL DIVORCE & BANKRUPTCY
CENTER
Now In Our 20th Year!
Debtors get much needed
'breathing room' and discharge or reorganize (chapter 13):
The American economy is based on consumer debt.
We are constantly being urged to 'buy-buy-buy'. The 1980's & 1990's
were decades of readily available credit and seductive pressures urging us
to 'buy' goods and services at an unparalleled rate. Many
Americans have been 'led' into an almost bottomless pit of insurmountable debt
overload.
Others suddenly face the reality that due to no fault
of their own, they've been the victim of the dramatic 'downsizing' of their
wallett. For whatever the reason, countless Americans
face the daily reality that their debts far exceed their income and
there's no help on the horizon. It's little wonder that economists predict the
number of consumers filing bankruptcy to continue to climb each year for at
least the next decade.
Individual Consumers are not the only ones who have fallen victim to
the lure of credit. We live in an age where the very
financial institutions granting consumers credit required $500 billion tax-payer
dollar bailouts to save them from themselves. Even governing bodies,
Orange County California, among them, have been forced to file for the
protection of federal bankruptcy to get the 'breathing room ' they needed to
'regroup'.
The average credit card balance is reported to be
in excess of $2,500, with most households having at least three cards.
The typical cardholder, in 1994, used about 10
different cards for gas, groceries, retail and other credit items, including
catalog orders and has an average credit card debt of
$25,000 .
It is not unusual for
a debtor's home to have multiple liens, for example (1).a mortgage, (2).
a home equity loan, and perhaps (3). a home improvement loan, that add up
to be more than the property's value leaving the debtor with no equity interest
in the property. (See Home
Loans for detailed information)
Because cars depreciate
at a rate usually faster than their payoff; the payoff on a
vehicle is often as much or more than the vehicle is worth in the
market place based on the standard 'Blue Book' value. (Exemptions
generally allow debtors to keep their home, car, personal property (i.e.
furnishings, etc.) as a means to a fresh start). (See State By State Exemptions )
It is not surprising that many debtors find themselves in a position of
"...being relegated to a lifetime of destitution or the
functional equivalent of financial indentured servitude from which they can
never hope to recover."(House Report No. 103-835)
It is little wonder that burdened with
insurmountable debt, many debtors often feel angry with themselves, their
spouses, and even their creditors. Many are embarrassed and feel
like a failure. Facing and dealing with debt problems and taking control
takes courage and can be a turning point at which the debtor is taking positive
action to improve their life, learning from past mistakes.
*Note: The following "Process" information was made available on an
internet news group bulletin board in 1995. [the pictures were added
as 'window dressing'.]
The Process of Chapter 7
The process is typically completed in 3-6 months,
depending on the court's schedule in your district and requires you to mail in your paperwork, pay the filing fee, and attend a brief
'hearing' or 'meeting' in your local area . The meeting is usually held
at your local federal court house or in towns without a federal court
house, the meeting of creditors is often held in the local post
office.
File for Chapter 7 by simply
mailing your paperwork to the clerk's office in your district with the filing
fee of $200.
- Filing the initial petition for bankruptcy
automatically puts the tremendous power and protection of the federal
bankruptcy code in to effect to protect you and your property and stop
creditor's actions to collect from you - no phone calls, no threats, no
harassment.
Within 7-10 days The clerk
will notify your creditors that you have filed, send you a Notice of
Commencement of Case, the appointment of the trustee, and notifies you of
the date, time, and place for the meeting.
- Within 40 days, you attend the creditor's meeting
(approx.30 min)
- Despite the name, very few (if any) creditors
actually attend the meeting which generally takes less than 30
minutes. The meeting's purpose is to allow any creditors that do attend, as
well as the Bankruptcy Trustee if he chooses, an opportunity to ask any
questions they may have about the debtor's finances; for example; your
income, expenses, number of dependents, etc..
- The Court Grants your Discharge of Debts.
- You will be mailed notice of a Discharge of Debts
which 'officially' relieves you of any obligation to pay your
discharged debts. They are wiped out! You truly have a financial fresh start.
A few districts require you to attend a final discharge hearing where there
may be as many as several hundred debtors just like you who all appear at one
time to have their debts officially discharged. The discharge proceeding often
resembles that of a naturalization hearing where hundreds of immigrants are
sworn in as American citizens all at the same time as a 'group'. The discharge
hearing (if you are required to attend) usually takes no more than 30 minutes -
1 hour.
*End of Bulletin Board Posting.
Filing Fee
in Chapter 7
The filing fee of $200 is the same in every state
because Bankruptcy is federal law. Debtors processing their own
bankruptcy without a lawyer pay the same filing fee that
lawyers pay . The fee is payable at the time you file (mail in) your
paperwork.
The National Divorce & Bankruptcy Center is a division of Pro Se
Publications, Self-Help Center, which began in May of 1994 and provides the
public with easy and inexpensive access to the courts without the expense of
hiring a lawyer. We help you better inform yourself about the subject matters
and procedures so that you can make your own informed decisions - about the
actions that affect your life.
We provide petition preparer services at low cost because we are not lawyers and do not provide 'legal
advice'. Instead, our service is limited to providing you with
self-help information and providing quality document preparation at your
direction.
IN SHORT - We Help Our Customers Solve Their Own
Problems; Without Hiring a Lawyer
Petition Preparers:
"Using a bankruptcy
petition preparer, rather than a lawyer can be a relatively inexpensive way
to get your forms prepared for filing in court . Bankruptcy petition
preparers may not, however, give legal advice, answer legal questions or
represent you in court - only lawyers may do those
things."5
Document Preparation; The Paperwork
Once you have made the decision to file for bankruptcy, the next
step is to 'list' your financial information, (income, expenses, assets,
debts) into the worksheet and return it to our office with the $200 document
processing fee.
Your information will then
be processed, generating all of the required forms listed above
required to file and complete your bankruptcy and will be return mailed to
you ready for you to sign and mail in to the court clerk's office for
filing.
We have provided a printable Work-Sheet
Just point - click - print! to
help you gather information and to ensure (as much as possible) that you don't
overlook any debts or property that could affect the accuracy of your paperwork.
The provided Work-Sheet can be used by
'clicking' on the Work-Sheet and then simply
clicking on your browser's print icon and printing out the work-sheet/form, or
saving the work-sheet and completing it using your own word processing program.
Paperwork & Fees: Know What You Are Paying For:
All of the following
paperwork is required to file and complete a chapter 7 bankruptcy and
is included in the paperwork we return to you - ready to be
filed:
- Petition
- > Schedules A-J
- Summary of Schedules
- > Declaration Concerning Debtor's Schedules
- Statement of Financial Affairs
- > Statement of Assistance By Non-Attorney in Regard to Filing
- Mailing Matrix
- > Verification of Mailing Matrix
- Individual Debtor's Statement of Intention
[*Note: in a chapter 13, a blank plan form for
proposing a repayment plan is also provided in addition to the above forms
listed.]
All of the above listed paperwork necessary to process a
bankruptcy, complete with your information will be return mailed by 1st class
USPS to you within 5 business days of receipt of your worksheet and payment of
the $200.00 document processing fee (most within 72 hours).
Work-Sheet Just point - click - print!
1.How To File For Bankruptcy; Nolo Press Berkeley; 10th Edition;
1998; Elias, Renauer, Leonard.
2. Personal Bankruptcy; Nolo Press
Berkeley; 1st Edition; 1997; Elias, Renauer, Leonard
3. ibid.
>
4. ibid.
5. ibid.
FILING BANKRUPTCY IMMEDIATELY STOPS: 
Alternate order form e-mail a physical
address and a form will be rushed to you via U.S. Postal; OR