A bankruptcy blog containing useful information for anyone considering a Charlotte bankruptcy attorney.

How Fast Can I File Chapter 7 Bankruptcy?

How fast you can file Chapter 7 bankruptcy depends a lot on how quickly you can provide information to your Chapter 7 bankruptcy attorney. In some instances, you can file an emergency Chapter 7 bankruptcy, which puts the Automatic Stay into effect while you and your Chapter 7 bankruptcy attorney continue to gather necessary information for the remainder of your filing. Click for a FREE CASE EVALUATION and we’ll call you today.

Reasons To File Chapter 7 Quickly

Wage Garnishment—If you’re facing a wage garnishment, filing a Chapter 7 bankruptcy will put a halt to the wage garnishment. Whether this will be a permanent solution or not depends on the type of debt which gave rise to the garnishment. If the debt will be discharged in bankruptcy, you should not experience the garnishment again. If the debt will not be discharged in bankruptcy (Spousal support, some IRS debt, etc.) then the garnishment may start again after your Chapter 7 closes out, or after the creditor applies for and receives Relief From Stay.

To Prevent Foreclosure—If you have a pending foreclosure, filing a Chapter 7 bankruptcy will halt the foreclosure process. Keep in mind, this may only be a temporary delay in the foreclosure process. Unless you’re able to get current with the mortgage lender quickly after filing, the lender will probably appeal to the court for Relief From Stay, in order to once again pursue their foreclosure. Even if the foreclosure does move forward, you may be entitled to some proceeds from the foreclosure under the Homestead Exemption in Chapter 7 bankruptcy.

To Prevent Repossession—If your vehicle is about to be repossessed, filing a Chapter 7 will freeze the vehicle lender in their pursuit to repossess. You’ll need to be ready to get current on your loan before your 341 meeting (40 days after filing), or expect the repossession efforts to continue at that time. You’ll also be given a chance to surrender the vehicle, if you want to get rid of the car and the heavy debt associated with it.

To Stop A Lawsuit—Filing a Chapter 7 will put the court on notice that you have filed and the Automatic Stay in bankruptcy is in effect. This serves to stop judicial proceedings against you. Depending upon the type of debt which gave rise to the lawsuit, there is a good chance our Chapter 7 will eliminate the debt and the lawsuit with it. In that case, the creditor will no longer have any rights against you.

Requirements To File Chapter 7 Quickly

Our firm can generally work as quickly as you would like, to file a Chapter 7 bankruptcy. The answer to “How fast can I file Chapter 7” is often: how fast can you do or provide the following:

Take the required online Credit Counseling course

Provide six months history of income

Provide two years of tax returns

Provide a current monthly budget of income and expenses

Provide limited other necessary information required to file

Pay Your Attorney Fee

Further Reading

You can read more articles on our Bankruptcy Blog Articles page, or click one of the recent articles below:

How Long Will My Bankruptcy Take?

Can I File Bankruptcy And Keep My Car?

Speak With A Chapter 7 Bankruptcy Attorney Today

Find out how fast you can file a Chapter 7 by calling us today at 704.749.7747 or by clicking for a FREE CASE EVALUATION. We will reach out to you within 24 hours to discuss your reason for filing, and to put a plan together to fight your creditors by using the powerful resource of a Chapter 7 bankruptcy filing. When it comes to choosing a law firm, we know you have options. We hope you choose to Recover With Us.

Will My Personal Injury Bills Go To Collections?

Car accidents lead to hefty personal injury bills for both property damage and medical treatment. Hopefully, you’ll recover enough in your personal injury settlement or your child’s personal injury settlement, to take care of all of your bills. The problem is that many personal injury claims take a year or longer to settle. Medical providers are not always as patient with your billing as you might want them to be.

Communication With Billing Providers Is Key

If you’re represented by a Charlotte personal injury attorney, generally they will reach out to your providers to let them know they represent you. This puts the billing provider on notice that it will be a while before the bill is paid. The hope is that once your provider knows your bill is being paid in conjunction with settling your personal injury claim, they will hold your bill until the case settles. In many cases, the provider will check in with the personal injury attorney’s office every few months for a status update on the case. They will then mark your file to be reviewed again in a couple of months.

What If They Send My Bill To Collections?

Even if your personal injury attorney tells the billing provider you are represented in a personal injury claim, the provider may still choose to send the bill to collections. This could also mean that credit reporting agencies will be notified that your bill is delinquent. While this is annoying and you don’t deserve this treatment, the providers have the right to treat unpaid bills this way.

Should I Make Monthly Payments On My Medical Bills?

There is nothing wrong with making payments on your medical bills until your personal injury case settles. When the case does settle, you can get credit for any payments you’ve made on the bills, the same way you will get credit for paying co-pays at the time of treatment. This may be a way to keep the bills out of collections until your settlement comes through.

Will My Personal Injury Attorney Negotiate My Personal Injury Bills?

We have written a few articles on this website in our Personal Injury Blog about negotiating medical bills. Typically your personal injury attorney will negotiate your medical bills. There are relevant North Carolina statutes which also limit the amount of your settlement that medical billing providers are entitled to. Your attorney will use these statutes together with arguments about your case, to encourage medical providers to lower their bills.

Filing Bankruptcy After Personal Injury

If your personal injury settlement is insufficient to pay all of your personal injury bills, you might consider filing bankruptcy. Our firm has helped numerous personal injury clients with bankruptcy filings. Clients generally have additional debt such as credit card debt or unrelated medical bills, which make filing a bankruptcy a smart decision. We’re happy to discuss how bankruptcy works, or you can visit our Bankruptcy Blog and get some questions answered there.

Speak With A Personal Injury Attorney Today

If you have questions about working with a personal injury attorney, or if you have questions about a medical bill from a car accident, call us today. You can call 704.749.7747 or click for a FREE CASE EVALUATION and we will contact you immediately. When it comes to choosing a personal injury law firm, we know you have options. We hope you choose to Recover With Us.

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Social Security Benefits And The Means Test In Chapter 7

If your income is low enough, you will automatically qualify for Chapter 7 bankruptcy. However, many clients have income slightly above the median income level, and must pass The Means Test in order to qualify for Chapter 7. This is not uncommon. The Means Test is simply a comparison of your income to your debts—some actual, and some allowances by the bankruptcy code.

Fortunately, The Means Test focuses on your most recent six months of income. This allows you to take advantage of some timing, if you have inconsistent income or unusual income which will not continue into the future. Your bankruptcy attorney will discuss this in more detail with you.

Types Of Income Included In The Means Test

The safe assumption is that every dollar hitting your accounts each month will be considered income for the purpose of The Means Test. This includes spousal support, support from family members, W-2 income, 1099 income, retirement income, and 401k early withdrawals.

Types Of Income NOT Included In The Means Test

While Veterans’ benefits DO count as income for The Means Test, Social Security benefits DO NOT. This means you may pass The Means Test if a large part of your income each month is Social Security benefits.

Current Monthly Income

Current Monthly Income is different from The Means Test calculation. Once you pass The Means Test, you still have to complete a budget reflective of your current income for the month. This is different from your income from the past six months. Additionally, you get to compare your actual expenses to your actual income for the month, where The Means Test does not always allow you to take your actual expenses. Even though your Social Security benefits will be counted in your Current Monthly Income, if you passed The Means Test, you should have nothing to worry about when it comes to Current Monthly Income calculations.

Further Reading

Want to learn more? Read one of over 100 articles on our Bankruptcy Blog Articles.

Speak With A Charlotte Bankruptcy Lawyer Today

The easiest way to get a better idea of whether you qualify for Chapter 7 is to speak with a Charlotte bankruptcy attorney today. You can call us at 704.749.7747 or click for a FREE CASE EVALUATION. After a brief discussion with an attorney, we can usually give you a good idea as to whether you will qualify for Chapter 7. We can also help confirm if a Chapter 7 or a Chapter 13 is the best choice for you.

How Much Does Chapter 13 Cost?

How Much Does Chapter 13 Cost?

In the Western District of North Carolina, the court sets the attorney base-fee at $4,500.00. However, you do not owe all of those funds prior to filing. You and your bankruptcy attorney will agree upon an amount you will pay prior to filing; the remainder will be built into your Chapter 13 plan, and paid over the course of your Chapter 13 case. There are also court filing fees, but again, those can typically be paid over time as part of your Chapter 13 plan payment.

What Determines My Chapter 13 Plan Payment?

Your Chapter 13 plan payment is a combination of both your ability to pay, and a comparison to what your creditors would receive if your assets were liquidated in a Chapter 7 bankruptcy filing. Additionally, if you have mortgage arrears (missed payments) or vehicle lender arrears, those will need to be paid over time in your Chapter 13.

Ability To Pay In Chapter 13

Your ability to pay is simply a look at your ongoing monthly income and expenses. Your bankruptcy attorney will propose a payment to the court. This proposed payment will be examined. Essentially, any leftover funds each month after your ongoing household expenses are paid, should be your minimum monthly Chapter 13 payment.

Arrears And Other Priority Debt

If you have mortgage arrears, as mentioned above, those will need to be built into your Chapter 13 plan payment. Additionally, if you have IRS or state tax debt which is less than three years old, that will need to be re-paid in the plan. Your attorney will calculate your payment on these items, in addition to a small percentage to be paid to your unsecured creditors. These calculations will be compared to your budget, or your “Ability to pay” as discussed above. If your budget supports the proposed monthly payment, your plan should be approved by the court.

Length Of Your Chapter 13 Plan

Most Chapter 13 plans are five years or 60 months. If you want to propose a shorter plan, you will typically be required to pay the same amount but over the shorter period of time. In many cases, if you propose a plan shorter than five years, it must be a 100% plan. This means that your plan proposes to pay your unsecured creditors 100% over the course of the Plan. A typical five year plan will pay somewhere between 1% and 15% to the unsecured creditors, depending upon the factors mentioned in this article.

Speak With A Bankruptcy Attorney Today

The easiest way to get a better idea of what your Chapter 13 plan payment would be is to speak with a Charlotte bankruptcy attorney today. You can call us at 704.749.7747 or click for a FREE CASE EVALUATION. After a brief discussion with an attorney, and after submitting some documentation, we will be able to estimate a Chapter 13 plan payment for you. We can also confirm if a Chapter 7 or a Chapter 13 is the best choice for you.

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Is My 403b Account Protected In Bankruptcy

Short Answer: Yes.

Much like a 401k plan, 403b retirement plans are protected in bankruptcy. If you are an employee of a state or county school, or a non-profit, you may have your retirement funds in a 403b retirement plan. While these funds do need to be disclosed upon filing bankruptcy, the bankruptcy trustee will acknowledge the bankruptcy exemption protecting those funds.

What If I Withdraw 403b Funds Prior To Bankruptcy?

If you take money out of a 401k or 403b account prior to bankruptcy, you should be aware that you will probably have tax consequences for early withdrawal. In terms of your bankruptcy, you should disclose those withdrawals to your bankruptcy attorney. Typically, those withdrawals will be treated as income for the purposes of passing The Means Test in bankruptcy. While this may sound unfair, this treatment is only for bankruptcy filing purposes, and usually will not upset the results of your Means Test. The Means Test helps to answer the question Can I File Bankruptcy?

Do 403b Loans Survive Bankruptcy?

If you have a loan against your 403b retirement funds, that loan will be treated as a secured loan for the purpose of your bankruptcy filing . In a Chapter 7 filing, the loan will survive the filing. In a Chapter 13 filing, the same result occurs; however, you will typically continue to pay on the retirement loan during your Chapter 13 repayment plan. This will help to reduce the balance and maybe even pay it off during the course of your Chapter 13 bankruptcy.

Speak With A Charlotte Bankruptcy Attorney Today

If you have questions about filing bankruptcy, we’re here to help. Case evaluations and consultations can be conducted by phone and are free of charge. You can call us at 704.749.7747 or click for a FREE CASE EVALUATION and we will reach out to you today. We know you have choices. We hope you choose to Recover With Us.

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How Long Does Bankruptcy Take?

There are two parts to your bankruptcy: pre-petition and post-petition. During the pre-petition phase of bankruptcy, the pace at which we move is generally determined by the client. In other words, if the goal is to file the bankruptcy, our firm is usually ready to do so before the client is ready. So the timing will be dependent upon how quickly you can get us the information we need, and payment. A good estimate is that it will typically take 2 weeks to a month minimum, to file. Most clients are filed within 2 months of beginning to work with us.

Post-petition, your bankruptcy filing will move along a more or less ‘set’ schedule, as determined by the court and outlined below. While there are some exceptions, you can generally rely on the timelines below.

Five Phases To Get Your Bankruptcy Filed

Entering Information – After a brief phone consultation, we will provide you with a login and password where you can begin entering information online. You do NOT need to manually enter information about your creditors. We will take care of that by ordering a credit report through our bankruptcy software. You will need to provide us with information about your last 6 months of income, you monthly expenses, and whatever property you own.

Review and Follow-Up – We will review your information and follow-up with you about specific items. For instance, if you tell us you sold property in the last 2 years, we will probably ask you for some specifics about that sale. We will also be able to confirm for you whether you will pass The Means Test for Chapter 7, and begin to estimate a payment if you’re filing Chapter 13.

Submitting Documents – There’s a list of documents we MUST have before we can provide you with a rough draft of your bankruptcy petition. This phase of gathering information is extremely important, as our bankruptcy filing with the court must match your actual account activity and filed tax returns, etc.

Online Credit Counseling – Prior to filing, you must complete an online credit counseling course. The course is paid for by our firm, and is purely educational. It’s not pass/fail. However, you will need to get the certification by completing the course. That certification is filed with your bankruptcy filing. Don’t worry, it’s all highly automated and the certificate comes directly to our email when you complete the online course.

Review and Sign Your Petition – Once we have gone over a draft of your bankruptcy petition and made any necessary changes, you will come into the office to physically sign your petition. The petition will then be filed electronically and a bankruptcy case number will be provided at that time. We will let you know immediately what your bankruptcy case number is and you can provide it to creditors if you receive any phone calls after filing.

Post-Petition Timeline

The Post-Petition timeline below is for Chapter 7 filings. While Chapter 13 filing have many of the same deadlines, you will not receive your Discharge until you make your final Chapter 13 plan payment. Chapter 13 plans are typically proposed at 60 months (5 years). While you can propose a shorter term, the total amount you pay will typically remain the same or increase. As a result, a shorter term results in a higher payment. We are happy to discuss this with you, as each Chapter 13 plan is unique.

Financial Management Course – (After filing, but before your 341 meeting date) Before you attend your 341 meeting, you should complete the 2nd and final online counseling course, known as the Financial Management course. It is purely educational and our firm pays for it. It is a requirement to receiving your Discharge in bankruptcy, so it’s important that you get it done. Don’t worry, we will remind you.

341 Meeting – (40 days after filing) About 5 days after filing, your case will be assigned a 341 meeting date. This date is typically about 40 days after filing, and in Charlotte it’s on a Wednesday. The meeting takes place near the Federal Courthouse, in a more informal setting with the bankruptcy trustee. There are typically no surprises at the 341 meeting. The trustee usually has reviewed your bankruptcy filing and asks a few follow up questions, and sometimes requests documents or bank statements which we have 14 days to supply to him or her.

Objections to Exemptions – (30 days after the 341 meeting) Your creditors and the trustee have 30 days after the 341 meeting to object to your Exemptions. Exemptions are statutory, and they are allowances which help you to protect your assets. For instance, there is a vehicle exemption of $3,500, a homestead exemption of $35,000, etc. We will go over all of your exemptions with you and use them to protect your property. Prior to filing your bankruptcy, you will know that your property is protected.

Objections To Discharge – (60 days after 341 meeting) The deadline for objections to Discharge is 60 days after the 341 meeting date. There’s nothing for you to do, but in our office we will be waiting to see if any creditors object to your Discharge. Typically, they do not. If they do, we will contact you and address the objection by filing a response with the court.

Entry of Discharge – Roughly 120 days after you file your bankruptcy, and all the deadlines for objections has passed, your Discharge will be entered, and your case will be closed.

Paying For Your Bankruptcy

We understand paying for bankruptcy is difficult when money is already tight. We try to be as flexible as possible when it comes to payment. We will gladly review your information before asking for any money from you. Once we confirm you will qualify for Chapter 7 or Chapter 13, we ask for a deposit. With the deposit made, we will continue to work on your case and you can tell your creditors you have legal representation. We can file your bankruptcy when you make your final payment.

Further Reading

If you’d like to read about additional bankruptcy topics, visit the Bankruptcy Articles page, where we have over 100 articles covering everything from credit scores to back taxes.

Speak With A Charlotte Bankruptcy Attorney Today

If you would like to discuss filing a Chapter 7 or Chapter 13 bankruptcy, call us at 704.749.7747 or click for a FREE CASE EVALUATION and we will reach out to you today. Bankruptcy is powerful relief from debt. It truly is a fresh start. We’d be happy to help you on your way to recover, and we hope you choose to Recover With Us.

can i file bankruptcy and keep my car

How Can I File Bankruptcy And Keep My Car?

Easily, that’s how. Whether you can file bankruptcy and keep your car is a question of the fair market value of the car at the time of the bankruptcy filing. That value is compared with any outstanding balance on the vehicle at the time. The difference between the fair market value and the outstanding loan balance is the equity. For example:

Vehicle: 2016 Toyota Camry
Fair Market Value: $15,500
Outstanding Loan: $13,000
Equity: $2,000

In the example above, we have a vehicle that is essentially worth $2,000 for bankruptcy purposes. The reason is that if you were to sell the vehicle, you would only end up with $2,000 after the loan was paid. For the purposes of your bankruptcy filing, this is a $2,000 asset.

Using Exemptions To Protect Your Car

If you’re wondering “How can I file bankruptcy and keep my car?” the federal bankruptcy code provides exemptions for each person filing bankruptcy which usually allow this. Some exemptions are specific to the type of property, while others can be applied to any property you choose. Each person filing Chapter 7 or Chapter 13 bankruptcy is entitled to use a vehicle exemption of up to $3,500, per N.C.G.S. Sec. 1C-1601(a)(3). Under the scenario above, you can keep the vehicle in a Chapter 7 filing.

What If My Equity Exceeds The Vehicle Exemption?

If the above example resulted in $4,000 of equity, you would exceed the exemption allowed under N.C.G.S. Sec. 1C-1601(a)(3) by $500. In that case, you could use some of the $5,000 exemption allowed under N.C.G.S. Sec. 1C-1601(a)(2). This is commonly known as the Wild Card exemption, and if it has not been applied to protect your primary residence, you can use it to protect any other property you own.

What If My Vehicle Does Not Have A Loan?

If your vehicle does not have a loan, the equation is still the same. In that case, the fair market value of your vehicle is the same as the equity. That amount would need to be protected or ‘exempted’ by using the NC bankruptcy exemptions. If the fair market value of your vehicle exceeds both the NC motor vehicle exemption and the NC wild card exemption, you may have ‘exposed’ equity, which would have to be addressed in the bankruptcy with the bankruptcy trustee. This is discussed below.

Addressing ‘Exposed’ Equity In Chapter 7

If you have additional equity which cannot be exempted with your NC bankruptcy exemptions, your attorney will negotiate an arrangement with the trustee by which you pay some or all of that exposed equity to the court. Typically, in order to avoid a sale of the property, which is costly and time consuming, the trustee will be flexible in reaching an agreement for a discounted amount. For example, if you have $2,500 of equity which cannot be exempted, you will list it as such on your bankruptcy filing.

The trustee assigned to the case will negotiate with our firm to have you pay an agreed upon amount to the trustee over time. A reasonable agreement in this scenario would be a payment of $1,500 (payments of $250 each) due in equal installments over the next six months. When the payments are complete, you will receive your discharge in bankruptcy and of course this means you get to keep your car. While this is not the best answer to the question “How can I file bankruptcy and keep my car?” it does provide a solution where there’s too much equity for bankruptcy purposes.

Speak With A Charlotte Bankruptcy Attorney Today

We’re here to answer the question “How can I file bankruptcy and keep my car?” Hopefully this article helped. Filing Chapter 7 can be a powerful relief, but certain rules must be followed to insure you get the result you desire. Your Charlotte bankruptcy attorney can identify the challenges associated with your case prior to filing, and discuss them with you. Once you have an agreed upon plan of action, you can file your case with the confidence that you’ll get the result you desire. If you’d like to speak with an attorney today about Chapter 7, call us at 704.749.7747 or click for a FREE CASE EVALUATION and we will call you today. We know you have choices. We hope you choose to Recover With Us.

How Soon Can I File Chapter 7 Again?

If you have already filed Chapter 7 some time ago and you’re wondering “How soon can I file Chapter 7 again?” this article will help answer the question. The following scenarios help determine how soon you can file Chapter 7 again. Look below to find the situation that matches yours.

After Discharge In Chapter 7

If you received a discharge in Chapter 7, you can’t file Chapter 7 again until eight years from the date you FILED the previous Chapter 7. This will enable you to also receive a discharge in the new Chapter 7, which is one of the primary goals of filing bankruptcy.

After A Chapter 7 Without Discharge

If your Chapter 7 case was closed without a discharge, you may be able to file again immediately. In situations where a case is dismissed due to a paperwork error, this is the case. If the case was dismissed for a failure to disclose pertinent information to the court, or for some other more serious reason, you can’t file Chapter 7 again until 180 days after the initial dismissal.

After A Dismissal In Chapter 13

If your Chapter 13 case was dismissed, you should be able to file a Chapter 7 immediately. You should also be able to receive a discharge in that new Chapter 7. A Chapter 7 is distinctly different from a Chapter 13, in that a Chapter 7 is a complete discharge of debt which does NOT require paying your creditors, unless you have too many assets or income. Your attorney will know prior to filing, whether you meet the income and assets requirements for Chapter 7.

After A Discharge In Chapter 13

If you received a discharge in Chapter 13, in order to file a Chapter 7 you must wait six years from the date the Chapter 13 was filed, before you can file for and receive a discharge in the new Chapter 7. There is actually an exception to this rule. If you paid off 70% or more of your unsecured debts in the Chapter 13, you should be able to file a Chapter 7 without waiting for the six years to run.

Further Reading

If you’d like to read more articles about Chapter 7, Chapter 13, Debt Settlement, you can check out our Bankruptcy Blog.

Speak With A Charlotte Bankruptcy

If you’d like to have a free phone consultation, just call us at 704.749.7747. Phone consultations are part of the job and we’re happy to provide answers to your questions. Or, you can click to schedule a FREE CASE EVALUATION and we will reach out to you. We know you have options. We hope you choose to Recover With Us.

Chapter 11 Bankruptcy

Chapter 11 Bankruptcy In NC

A Chapter 11 bankruptcy is a way to reorganize your business debt while continuing to do business. Chapter 11 enables you to continue your livelihood without the constant threat of creditors to sue you, shut down your business, or otherwise disrupt you from being profitable.

When you file Chapter 11 bankruptcy, you and your bankruptcy attorney are proposing a plan to your existing creditors. Depending upon the profitability and assets of the ongoing business concern, your plan will propose to pay a percentage of your debt to creditors over time.

The Cost of Chapter 11 Bankruptcy

The court charges a filing fee of roughly $1,200.00, together with an administrative fee of $550.00. There are ongoing quarterly fees which must be paid to the court as well. Your attorney fees related to Chapter 11 bankruptcy are hourly. While your bankruptcy attorney will need to evaluate your case before estimating the attorney fees, it is a safe assumption your Chapter 11 bankruptcy will cost somewhere between $10,000.00 – $15,000.00. We know this is a substantial amount of money. Whether to file Chapter 11 will depend upon whether the cost of doing so is outweighed by the benefit to you and your business. Your bankruptcy attorney should help you sort through those questions as you gather information about the business together.

Do My Creditors Have To Accept My Chapter 11 Plan?

No, your creditors do not have to accept your Chapter 11 plan. However, if the plan is reasonable given the income, assets, and overall financials of the business, your bankruptcy attorney will argue on your behalf that the plan should be accepted. Generally, your Chapter 11 plan is a five year plan; however, you can propose a shorter plan if the shorter plan pays all creditors in full over the course of the plan. Generally, you must commit all of the business’s disposable income over the five year period to the plan. The calculation of disposable income is an equation involving income and expenses. If income and expenses change significantly during the plan, your Chapter 11 plan may need to be re-evaluated. In this regard, the Chapter 11 bankruptcy is reflective of your ability to pay, both at the time of filing and ongoing during the life of the plan.

Chapter 11 For Corporations vs. LLCs or Partnerships

A Chapter 11 bankruptcy for a corporation will only consider the assets of the corporation. To the extent the individual filing bankruptcy owns stock of the corporation, the stock assets must be considered in the assets calculations filed with the court.

A Chapter 11 bankruptcy for a partnership, LLC or sole proprietorship, is distinguishable from a Chapter 11 for a corporation or “C-corp”. In this filing, the individual and the business are treated as one for bankruptcy. The result is that all personal assets must be disclosed and considered when proposing the overall plan to pay back creditors over time in Chapter 11.

Chapter 11 vs. Personal Bankruptcy

In many cases, it is preferable to file a personal bankruptcy—Chapter 7 or Chapter 13—in lieu of filing a Chapter 11. The cost of filing is considerably lower, and the complexity of the case is different as well. If your company has few assets, you may be able to accomplish your goals by dissolving the company. This will relieve the company’s obligation under company debt. To the extent there is a personal obligation attached to the company debt, a Chapter 7 or Chapter 13 would serve to discharge the individual from that debt.

Speak With A Charlotte Bankruptcy Attorney

The next step is to speak with a Charlotte Bankruptcy attorney. Consultations and case evaluations can be done over the phone or in person. You’ll come away with a much deeper understanding of your options. This alone provides peace of mind. If you decide to move forward with a bankruptcy filing, we can discuss next steps and take action together immediately. Call us at 704.749.7747 or click for a FREE CASE EVALUATION and we will reach out to you. We know you have options. We hope you choose to Recover With Us.

How Fast Can I File Chapter 7 Bankruptcy

Who Notifies Creditors About My Bankruptcy Filing?

The Bankruptcy Court notifies your creditors about your bankruptcy filing. The most common way that creditors find out about the bankruptcy filing is from a letter directly from the Clerk of the United States Bankruptcy Court.  All creditors listed in your bankruptcy schedules will receive notice of the filing. The form of the letter is known as a B-9A and it contains all kinds of detailed information about the filing.  It lists the debtor, the debtor’s address, and the last four digits of the Social Security number.  It names the attorney for the debtor as well as the address and the phone number.  Of course it has the case number.  It has the jurisdiction in which the case was filed and most importantly, it has the trustee as well as the date, time and location of the Meeting of Creditors.  There is also some information on the B-9A regarding what actions certain creditors can take or not take now that a case has been filed. Sometimes, the debtor may not want to wait for letters from the court to reach creditors. According to long time Chicago bankruptcy lawyer David Siegel:

In some situations, you don’t want to wait for the clerk to notify your creditors but you want to have your attorney send an Automatic Stay to the creditor in advance of receiving notice from the clerk.  This would be common if there is a garnishment or other type of court proceeding and you want the creditor to get notice immediately about your bankruptcy filing.  The Automatic Stay is a one-page document that gets sent to creditors either by fax or email notifying them that a case has been filed on your behalf and that certain actions cannot be taken.  Those actions include any type of effort to collect on a debt including sending statements, making phone calls or trying to attach bank accounts or wages.

Only Listed Creditors Will Receive Notice, So be Thorough

It is important to emphasize that only creditors listed on your schedules will receive notice of your bankruptcy filing. If you leave a creditor off your filing, they will not be bound by the discharge.

Having said that, if they do receive notice, they should immediately stop harassing you. If you are having problems with a particular creditor, notify your attorney.  He or she has the ability to send additional notices and motion to take that creditor before the bankruptcy court for sanctions.  Creditors are prohibited from attempting to collect on debts once they receive notice that a bankruptcy case has been filed.

The Bottom Line

As long as you follow the rule of full disclosure, and list all debts and assets, your attorney as well as the clerk will help make sure that each creditor is notified about your bankruptcy filing.

Further Reading

Can I Keep Credit Cards In Bankruptcy?

How Long Does Bankruptcy Take?

Speak With A Bankruptcy Attorney Today

Call us at 704.749.7747 to get your questions answered and take next steps toward filing bankruptcy in Charlotte, North Carolina. Or, click for a FREE BANKRUPTCY CONSULTATION and we will reach out to you shortly. The call is free and we’re here to help. We know you have options. We hope you choose to Recover With Us.