Having crippling credit card debt is one of the main reasons for individuals to file for bankruptcy. Many people view filing for bankruptcy to clear their credit card debt as a fresh start. However, the process is not as simple as one might think. Continue reading to discover the bankruptcy process to properly take for clear credit card debt.
What You’ll Need
To get started with the bankruptcy process you will need the following documents: the last six months of your paystubs, the last two years of filed federal income tax returns, copies of all bills that are currently due, copies of any documents sent by collectors or creditors, credit reports from each of the three credit agencies, and any copies of collection lawsuit against you.
You will also need to provide a list of all of your assets. Even if your belongings are not worth much, you will need to list everything you own. To evaluate any household goods, personal items, and clothing, you can simply list what you would expect to pay at a yard sale for these items. Obtain an appraisal for any antiques, arts, collectibles, and jewelry you own. You should also get an online market estimate for any property or automobiles you own. Finally, you will need to provide the last six months of statements from your bank accounts.
Calculating Your Expenses
With help from the information in your current bills and the last six months of bank account statements, you should list your expenses in insurances, car loans or leases, utilities, rent or mortgage, and cable, internet, and cell phone bills. You will also need to provide your monthly expenses for commuting or groceries. A trick to achieve this number is to multiple a typical weekly amount by 56 and then divide this new number by 12 to get your monthly amount. Don’t forget to add any personal care expenses like haircuts or salon visits. Finally, you should add travel, gifts, tithing to a religious institution, and medical copays to properly calculate your expenses.
Depending on the amount of income relating to the size of your family, you may have to file bankruptcy under either Chapter 7 or Chapter 13. Chapter 7 only qualifies individuals earning a certain amount of income. If you do not pass the means test for filing bankruptcy under Chapter 7, you will file a Chapter 13 bankruptcy case. This means that you will also pay a portion of your debt over a three to five-year plan to your creditors.
What to expect after filing for bankruptcy
Once you have successfully completed each of the following steps, your 314(a) meeting will be scheduled:
- Filed your petition,
- Filed your list of creditors
- Filed your schedules
- Completed your certification of completion of credit counseling court
- Paid your filing fee
After each of these steps has been completed you will receive a docket number. You will then meet with the Trustee during your 314(a) meeting of creditors. This meeting is required to verify your identity and answer any questions under oath about your financial situation.
After you have filed, you should take a second financial management course and file your certificate of completion.
Once the deadline for creditors to object to discharge has passed, the court will enter a discharge order. Once this discharge order has been entered, you are no longer responsible for paying back non-priority unsecured debt. This will likely include credit card debt. It will also likely include personal loans and medical debt.
Reach out to an experienced New York bankruptcy attorney today to get this process started. You deserve a fresh start. Contact our firm to schedule an initial consultation.
Contact our experienced New York firm
Bankruptcy, for many people, is a frightening endeavor. Fortunately, with the help of an experienced attorney, it does not have to be. If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options. We will have your back every step of the way.