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The Bankruptcy Process

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At the moment of filing a bankruptcy, an automatic stay goes into effect. This is a provision of the Bankruptcy Code that prevents most creditor action against you. This is the part of the law that stops foreclosure, lawsuits, levies, and creditor calls. If a creditor does not cease their actions against you, call John E. Smith & Associates immediately.

At about thirty days, you will have a creditor’s meeting scheduled at the Federal Courthouse. In Galveston, they will be held at 601 Rosenberg. It will be in a regular meeting room without a formal court process and without a judge.

The Trustee appointed by the Court to oversee your case will conduct your meeting. Your Galveston County bankruptcy attorney will be present, but you will be required to answer mostly simple questions about your case. You must have your picture ID and original proof of your Social Security number or the meeting may not be conducted. If there are questions by the United States Trustee about your Means Test, they will be covered at that time. We will work with you to have all necessary documents to the Trustee ahead of time.

Here is a sample of questions you may be asked:

  • Did you list all of your debts and assets?
  • Anyone owe you any money at the time you filed? This includes IRS refunds.
  • Do you have any lawsuits or potential lawsuits against anyone where you might be owed money?
  • Do you have any inheritances due you at the time of filing or within six months after the date of filing?
  • Have you repaid any money to friends or relatives within the last four years?
  • Have you transferred any property by sale or gift within the last four years to friends or relatives or the last 90 days to anyone? Were the transactions for fair market value?

Chapter 7

If you are going through a Chapter 7 case, the creditor’s meeting is probably your only appearance at the courthouse. A 60-day period then begins where creditors or “parties in interest” that believe you should not receive a discharge can file a lawsuit in the Bankruptcy Court against you. These cases are rare and usually involve some type of fraud or non-disclosure of assets. If you are not sued, you become eligible for a discharge any time after that period.

The Court Clerk will enter the discharge. You and all of your creditors will get a copy.

Chapter 13

If you are in a Chapter 13 case, the creditor’s meeting may be followed with other actual court appearances. Usually, our lawyer can appear on your behalf. About 45 days after the creditor’s meeting, a Confirmation Hearing is held in Court. This hearing is where the judge either approves or denies the Chapter 13 Plan of Reorganization you have filed. We will let you know if your appearance is necessary. This is where any disputes with the Trustee or creditors will be resolved. If the case is confirmed (approved), you continue to pay the Trustee and all should work out well to receive a discharge at the end of your plan.

Often, problems may arise during the term of your plan. If you get behind on your payments to the Trustee, he will file a Motion to Dismiss. If granted, a dismissal will remove you from the Bankruptcy Court and its protection. It is very important that we hear from you if you receive a Motion to Dismiss. John E. Smith & Associates will have time deadlines to file a Response with the Court to protect you.

Modifications

Sometimes, if you get behind because of income disruptions, your case can be modified. A modification would rework your plan to cure the arrearage payments to the Trustee and possibly lower future payments.

Modifications can be time-consuming, which is why it is vital that you contact our firm in a timely manner to work on it.

Discharge & Rebuilding Credit

Once you receive a discharge, you can begin to restore your credit. The bankruptcy should remain on your credit report for 10 years. You will be solicited for and receive credit soon after exiting bankruptcy. Your interest rates and down payments will be higher for a while.

Be very careful to not get too much credit again. John Smith loves what he does, but would always prefer not to handle a second case for you!

"The Biggest mistake many people make in filing for Bankruptcy? Waiting too long."

How to Get Started

It is very important that you talk to a qualified Galveston County bankruptcy attorney before filing a bankruptcy. A paralegal or legal assistant will not do. They do not have the knowledge, training, or experience to counsel you about the complexities of bankruptcy law. You may communicate with our lawyer directly with any questions, or call (281) 954-3161 for an appointment.

These are the steps you will need to begin the process:

  • The Law currently requires you to take a credit counseling course before filing the case as your “ticket in” to bankruptcy. I will guide you in obtaining this course before you file. The counseling agency will send a certificate of completion directly to my office for filing with the Court. We suggest waiting to take the course until after the other initial steps have been taken. Later, after your creditor’s meeting (approximately 30 days after filing) you will need to take a second course in personal financial management. This is your “ticket out” of bankruptcy. Without it, you are not eligible to receive your discharge. You may take this second course from the same provider.
  • Once you hire our firm, we will email you a link to our bankruptcy forms portal. Use the link and password contained in the email. Answer the questions to begin the bankruptcy process. The questions must be answered in full and in detail. This information can then be downloaded by our attorney. We cannot file your case with this limited information. When you are entering this data, averages and guesstimates will not do. We must have the actual, correct, detailed answers that the Bankruptcy Code requires.
  • Gather the following documents and upload them to the same portal you use to provide the other information:
    • Copies of Income Tax Returns for the last four years.
    • Retail Installment Contracts for all secured items being financed. Secured Items would include vehicles, mobile home, furniture, large appliances, satellite dish, homes, land, etc.
    • All loan contracts for loans that you pledged your household goods or other assets as collateral. Contract must list items you put up as collateral.
    • If your home is up for foreclosure, please provide a copy of the foreclosure letter from either the mortgage company or the mortgage company's attorney. If your vehicle is being repossessed, please provide the name and telephone number of the person we need to contact. If you have an IRS levy, please provide a copy of the IRS levy that our office needs to have released.
    • Copies of last 6-months worth of paychecks and/or paystubs.
    • Copy of your Social Security card and driver’s license.
    • Copy of proof of auto insurance.
    • Copies of payment coupons for all mortgages on home.
    • Copies of any lawsuits or Judgments.
  • Contact John E. Smith & Associates for an initial consultation at our Houston or Friendswood office.

Bankruptcy is not always the solution. But when it is... get it done right! Call our Galveston County bankruptcy attorney at (281) 954-3161 today.

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