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    Important Terms to Know When You File Bankruptcy

    Last updated 7 months ago

    If you’re like most people, you’re relatively unfamiliar with the legal and financial terminology that comes up in a bankruptcy proceeding. Even though your bankruptcy attorney will be able to answer any questions you have about the process, it’s a still good idea to familiarize yourself with some of the terms you’ll be hearing throughout the next few months. The following is a brief guide to some common bankruptcy terms and phrases

    Credit counseling
    Before filing a bankruptcy petition, you must attend an individual or group credit counseling course from an approved credit-counseling agency. In a Chapter 7 or Chapter 13 case, you will need to attend an instructional course in personal finances and money management before your debt can be discharged. However, if the bankruptcy administrator in your case finds that there isn’t a sufficient number of approved credit counseling agencies available, you may be exempt from this requirement.

    Joint administration
    Unless there are conflicts of interest, sometimes, bankruptcy petitioners can choose to file their cases together. This process is known as joint administration, and it allows separate businesses or individuals to combine their resources and work with the same bankruptcy attorney. Joint administration differs from a joint bankruptcy petition in that only a husband and wife are eligible to file a joint petition together.

    Means test
    If you’re considering file for Chapter 7 bankruptcy, you are required to first complete the means test, under section 707(b)(2) of the Bankruptcy Code. To pass the means test, your aggregate current monthly income over the course of five years must be under $10,950. However, you can also rebut your means test results by proving that there are special circumstances that justify additional expenses or adjustment of your current monthly income.

    By calling Cutler & Associates, Ltd. today, we can help stop collection calls, UCC 1 filings, asset sales, and wage garnishments. Our office also offers a free bankruptcy evaluation with an Aurora bankruptcy attorney. Call (847) 868-2265 to schedule a meeting at one of our seven convenient Chicagoland locations.  

    What Is the Timeline for Filing Bankruptcy?

    Last updated 7 months ago

    A Chapter 7 bankruptcy petition can be completed relatively quickly, as your debt can be discharged within three to six months of filing your petition. Once you file your petition with the appropriate court, the court should issue an automatic stay, which prevents your creditors from taking any collection action against you. Next, the court will assign a trustee to oversee your case, review your petition, and schedule a meeting of your creditors. 

    15 days later
    Once you file your bankruptcy petition, you have 15 days to disclose information about your assets, liabilities, expenses, and income. However, your bankruptcy attorney will most likely file these schedules with your original application. In the next 15 days, the court will mail you a Notice of Commencement of Case, which gives a date for your meeting with your creditors. The court will also provide this notice to your creditors, along with a deadline for them to file a claim against you.

    30 days later
    You are required to file a Statement of Intention within 30 days after your case is filed. The Statement of Intention tells the court whether or not you plan to keep your property or surrender it to your creditors. If you plan to keep your property, you need to clearly state whether you plan to reaffirm your debts and continue making payments or redeem the property by paying fair market value.

    3 to 6 weeks later
    The meeting of your creditors occurs between three to six weeks after you file your case. At least seven days before the meeting, you need to give the bankruptcy trustee and creditors a copy of your latest filed tax return. Your court-appointed trustee will oversee this meeting, where you will be asked to testify about the accuracy of your previously provided financial statements.

    The best way to stay on track during the bankruptcy process is by working with an experienced bankruptcy attorney. Since 1990, Cutler & Associates, Ltd. has provided quality legal representation to Chicagoland residents. You can schedule an appointment at our Aurora or Schaumburg location by calling (847) 868-2265.    

    Use This App to Learn the Basics of Bankruptcy

    Last updated 7 months ago

    Most bankruptcy cases fall into one of three chapters—Chapter 7, Chapter 11, and Chapter 13. Bankruptcy cases are handled exclusively in Federal courts, meaning that petitioners are unable to file cases with their local state courts. Ultimately, the purpose of bankruptcy law is to help people and businesses that are unable to pay their creditors achieve a fresh financial start.

    Bankruptcy laws dictate the liquidation of individual assets to pay for consumer debt as well as the creation of repayment plans. In bankruptcy cases involving troubled businesses, bankruptcy law helps ensure orderly distribution to creditors through liquidation or reorganization. The Bankruptcy Code App from Android provides a closer look at the Federal rules dictating bankruptcy procedure.

    Call (847) 868-2265 to schedule a free bankruptcy evaluation with Cutler & Associates, Ltd. We have seven convenient locations, including offices in Aurora and Schaumburg. 

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    Last updated 8 months ago

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    Last updated 8 months ago

    • on Avvo
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