Posted By
Karen Ware

The Chapter 7 Bankruptcy Process

Q: What does the Chapter 7 bankruptcy process look like from start to finish?

A: These are the main events in a Chapter 7 bankruptcy when you work with our office:

  • Free phone consultation with our office.
  • Intake meeting, either in person at one of our offices or by Zoom. You will bring the required documents (see the document checklist below) and case fees are paid at this meeting.
  • Pre-filing credit counseling course, completed online before your case is filed.
  • Your case is filed with the bankruptcy court.
  • Financial management course (the “second course”), completed about a week after your case is filed.
  • Meeting of creditors with the bankruptcy trustee, about 30 to 40 days after filing.
  • Creditor objection period: 60 days after the trustee meeting.
  • Discharge order entered by the court, about 75 days after the trustee meeting.
  • Case closing, one to four weeks after your discharge.

Q: How long does a Chapter 7 bankruptcy take?

A: A Chapter 7 bankruptcy typically takes 3 to 4 months from the filing date to the discharge date. Case closing usually follows shortly after the discharge order is entered.

Q: What is the trustee meeting / meeting of creditors?

A: The trustee meeting (also called the “341 meeting” or “meeting of creditors”) is a short hearing where you and your attorney meet with the bankruptcy trustee assigned to your case. These meetings are held on ZOOM. It usually takes place about 30 to 40 days after your case is filed. Shortly after we file your case, we will send you an email with the information and procedures for the meeting.

Q: What credit counseling courses do I need to take?

A: There are two required courses, both completed online.

  • The first course (pre-filing credit counseling) must be completed before your case is filed. We recommend www.debtoredu.com — use the green button for the first course.
  • The second course (financial management course) is completed about a week after your case is filed. We recommend www.debtoredu.com — click the large red button labeled “Second Course.”

Q: What documents do I need to provide for my bankruptcy?

A: Here is the standard document checklist for a bankruptcy file:

  • Color PDF scan of your photo ID
  • Color PDF scan of your Social Security card
  • Seven (7) months of paystubs for you, for all jobs
  • Seven (7) months of your spouse’s paystubs — required even if your spouse is not filing with you
  • Your last filed federal (IRS) tax return — all pages
  • Your last filed state tax return — all pages
  • Last 6 monthly statements for each of your savings and checking accounts, plus your spouse’s savings and checking accounts
  • IRS tax account transcripts (only if you owe past-due federal taxes)
  • California FTB statements (only if you owe past-due California taxes)
  • Trust documents, if applicable
  • Copies of any lawsuits and judgments
  • Copies of any garnishment orders
  • Pre-filing credit counseling certificate
  • Collection notices for any debts that do not appear on your credit report
  • We will also send you our List of Debts Questionnaire, Bankruptcy Intake Questionnaire, and Representation Agreement by email.

Q: What should I do — and not do — once I decide to file bankruptcy?

A: Once you have decided to file, please:

  • Do not apply for any new credit and do not use any existing credit.
  • Do not pay back business partners or family members debts you owe to them.
  • Do not transfer, sell, or change title on any assets you own.
  • Check to be sure you have a copy of your Social Security card. If you do not, order a new copy immediately.
  • At least 3 days before your case filing date, consider closing any credit union checking or savings accounts. Credit unions often close these when a member files bankruptcy.
  • Download statements from your credit accounts before filing — online access is usually cut off after the case is filed.
  • Send checking and savings statements to your attorney.
  • Complete the online pre-filing credit counseling course.

Q: What happens right after my case is filed?

A: As soon as your case is filed, the automatic stay goes into effect. This is a court order telling your creditors to stop contacting you and trying to collect debts. If a creditor contacts you after your case is filed, tell them they must communicate through your attorney.

A few other things happen at filing:

  • You will stop paying your unsecured creditors.
  • You will continue paying your secured debts (such as car loans and mortgages) in full and on time, if you want to keep the collateral.
  • You will continue paying your ongoing living expenses, like rent, utilities, and food.
  • Any debts that did not exist on your filing date are not affected by your bankruptcy
  • Do not sell or give away anything you own while you are in bankruptcy, and avoid unusual expenses, like an expensive vacation.
  • A few days after filing, you will start receiving notices from the court in the mail. Please open court mail right away and review it carefully.

After Your Discharge

Q: Which debts were discharged?

A: The court will not send you a list of the individual debts that were discharged. To know which of your debts were discharged, you have to look at how each debt was scheduled in your bankruptcy:

  • Schedule D — secured debts: Your personal liability for the debt is discharged unless you reaffirmed the debt (reaffirmation is very rare.) But you must keep paying as usual if you want to keep the collateral (typically a house or vehicle).
  • Schedule E — priority debts: Generally not discharged in your bankruptcy.
  • Schedule F — non-priority, unsecured debts: Most are discharged. Student loans are not discharged unless you filed a separate lawsuit to discharge them.
  • If a creditor successfully objects to discharge of a particular debt, that would show up in the case history maintained by the court. But this is rare.

Q: I forgot to list some debts in my bankruptcy. Do I still owe those debts?

A: If you forgot to list some debts, they may still be dischargeable as part of your bankruptcy, as long as the debt existed on your case filing date. If you need to amend your court documents to add additional debts, we can help.

Q: What happens to my vehicle loan after bankruptcy?

A: If you have a vehicle loan, your personal liability for the remaining vehicle loan payments is discharged by the bankruptcy. That means the lender cannot sue you personally if you fall behind on payments after bankruptcy.

However, the lender still has a lien on the vehicle and can repossess it if you do not make payments. To keep the vehicle, you must continue making each payment in full and on time.

Q: I chose to surrender my vehicle in my bankruptcy. What happens next?

A: Lenders often wait until the bankruptcy closes before picking up surrendered vehicles. They will typically contact you to arrange pickup, but they can also pick up the vehicle without warning. A few practical reminders:

  • Do not keep valuables in the vehicle.
  • Keep your vehicle insurance and registration current until the lender takes possession.

Q: A creditor keeps calling me after my bankruptcy was filed. What should I do?

A: A creditor who continues to contact you after your case is filed is violating the bankruptcy automatic stay or your discharge. Here is what to do:

  • Tell the creditor you have discharged their debt in bankruptcy.
  • Be ready to give them your bankruptcy case number.
  • Make a note of the date and time of the call and the name of the person you spoke with.
  • If the creditor keeps calling, let us know — we can help. Additional attorney’s fees apply to resolving creditor contacts that occur after the meeting of creditors, but in some cases those fees can be recovered by suing the creditor for bankruptcy violations.

Q: I have new financial issues that came up after I filed. Can you help?

A: Sometimes new financial issues arise after a case is filed — common examples include tax issues, banking issues, vehicle payment or surrender issues, credit reporting issues, and insurance issues.

If the issue arose after your filing date, or if it is not a bankruptcy issue, we would need to sign a new representation agreement to assist you with resolving it.

Q: What bankruptcy documents should I save?

A: Please save your discharge papers along with a copy of all of your bankruptcy case documents and the emails we sent you about your case.

Q: How long will the bankruptcy show up on my credit report?

A: A Chapter 7 bankruptcy can appear on your credit report for up to 10 years. A Chapter 13 bankruptcy can appear for up to 7 years.

Q: When can I start applying for new credit and rebuilding my credit?

A: As soon as your case is closed, you can apply for new credit. Keep in mind that case closing is a separate event from your discharge.

Cautious use of credit will help you rebuild more quickly, so use credit only when needed.

Q: Will my student loan payments and IRS or tax payment plans automatically start back up after my case closes?

A: No. You will need to contact the IRS, the California FTB, any other taxing authorities, and your student loan lender directly to resume payments on non-dischargeable obligations after your case is closed.