The process of filing for bankruptcy usually involves the filling of various forms along with your bankruptcy petition – these forms are mandated by the court. Along with the forms, the debtor needs to gather all supporting information or documentation. This can take up a lot of his time. In cases, where the debtor is really stuck with a crisis situation like the foreclosure of a home or a wage garnishment, then he can file an emergency bankruptcy by filling a few of the needed forms to get the process started.
Why an emergency bankruptcy?
As soon as you file for bankruptcy, the automatic stay on collecting the dues from the debtor kicks in. Let’s say you have a car loan or a home loan that you haven’t been paying your dues against. The filing of a bankruptcy will stop the car loan financer or the mortgage company from repossessing your vehicle or the foreclosure of your home in this case, at least temporarily. However, there are limits and some exceptions to this automatic stay. Hence reach out to acclaimed bank attorneys for knowing the process of filing an emergency bankruptcy. Recovery Law Group is supportive for handling the minimalistic expectations or filling out of forms in cases of emergency bankruptcy and can initiate the automatic stay for the debtor. In this way, they can help you protect your property and you can take a little more time to complete the rest of the forms needed in this bankruptcy filing.
Things to note ahead of emergency filing for Chapter 7
Please make a note of the below conditions prior to filing for emergency bankruptcy
- The bankruptcy law requires the debtor to take a credit counselling class that has been approved by the court. The only exemption to not take up this course or class is if the debtor is physically impaired or disabled. Another exemption is for debtors who are in active combat zones. The class is also available as online or telephone courses. After the completion of the class (which also mandates the passing of a quiz), the certificate of credit counselling is issued. Please note that the certificate’s date is at least a day ahead of the filing.
- If you are seeking the relief from Chapter 7 bankruptcy, ensure that you take up the means test. Check out the guidelines and validate your eligibility with the bank attorney.
Emergency filing under Chapter 7 – Forms
In order to avail the benefit of the automatic stay, the bare minimum of documents that need to be filled and submitted are mentioned below:
Voluntary Petition: This is a document of three pages that contain personal information and the summary of your case viz. the a number of creditors and the approximate amount of debt.
Creditor Matrix: The information about the creditors or any other third party who need to be notified of your bankruptcy is chartered in the Creditor Matrix. The local bankruptcy court of your state may stipulate the parties who need to be notified and the required format
Exhibit D: The debtor needs to mention that he understands the credit counselling requirement of the court in this case. He supports the Exhibit D form along with the certificate of the credit counselling or mentions the reason for an exemption to the court (if the course hasn’t been completed)
Along with the aforementioned forms and a filing fee, you may file for emergency bankruptcy. The bank attorneys may insist of add-on forms to the above if they are mandated by the state that you are living in.
Completion of the rest of the forms – Chapter 7
The remaining of the bankruptcy filing forms can be completed within 14 days from the date of filing the emergency bankruptcy. The guidance of an experienced bank attorney, Los Angeles for the state of California or even from the team that operates in other states will be crucial to fill out the rest of the forms. They are sometimes 60 pages long and the details that are expected to be furnished in there needs to be accurate and honest. Additional time can be sought from the bankruptcy court if it is needed. If the court approves it, a newer deadline for completion of forms is given to the debtor. Missing deadlines even after getting an approved extension will eventually lead to the dismissal of the case.
Understanding the Chapter 13 emergency filing
Now let’s quickly check if the process is any different in Chapter 13 as compared to Chapter 7 emergency filing.
- The credit counselling requirement stays intact here too. The only difference is that you need to ensure that your income is regular to pay off the debts as per the repayment plan that you will propose in Chapter 13 bankruptcy
- The same forms are applicable for Chapter 13 bankruptcy too and the good news is that the filing fee is lesser compared to Chapter 7
- Just as in the case of Chapter 7, you will be granted 14 days to finish the rest of the forms. In addition, the proposed repayment plan for Chapter 13 also needs to be completed in this 14-day tenure.
- The first payment as per the repayment plan needs to be made with in the 30 days of the emergency filing. Even if you have taken extensions to the deadline for the completion of the form, the date of initial filing is considered for calculating your first payment due. Note that your case can get dismissed, if the first payment is not received on time, by the trustee.
Hence understand the need of the situation and if you need an emergency filing, do so with an attorney who has ample experience doing this. He can work with you on the repayment plans, filling of the remaining forms and pursuing extensions on the deadline if you need additional time. Remember that your asset can be secured through the automatic stay and it will be important to be making the right decision with the right team of bank attorneys.