The moment you file your bankruptcy petition at the Clerk's
Office, the law imposes an Automatic Stay that takes effect
immediately. The automatic stay prohibits all creditors
from taking any collection action against you (the debtor)
or your property. Creditors must be advised that the Automatic
Stay is in effect.
Approximately two weeks after you file your petition,
the clerk's office will send a Notice to Creditors, that
you have filed for bankruptcy protection. Such notice
will be sent to all the creditors you have listed on your
mailing matrix. The notice also informs them of the date
of the meeting of creditors.
you need to notify any of your creditors sooner, you must
give them notice of your bankruptcy filing yourself.
exact information in the Notice to Creditors varies, depending
on the chapter under which the case is filed. In chapter
7 cases involving an individual debtor, creditors generally
have sixty (60) days from the first date set for the meeting
of creditors to object to the discharge of the debtor
and/or the dischargeability of a specific debt.
Approximately two weeks after you have filed your bankruptcy
petition, you will receive a notice from the Clerk's Office
with the date and time of the first Meeting of Creditors.
Meeting of Creditors is held in every bankruptcy case.
The debtor must attend the meeting. In many cases it is
the only meeting (or hearing) that the debtor must attend.
It usually occurs between twenty and forty days after
the date you file the original petition with the court.
chapter 7, chapter 12, and chapter 13 cases, the meeting
is conducted by the trustee whom the United States Trustee
has assigned to your case. No bankruptcy judge is present
at the meeting. In chapter 11 cases, where (usually) the
debtor is in possession and no trustee is assigned, a
representative of the United States Trustee's office conducts
hearing permits the trustee or representative of the United
States Trustee's Office to review the debtor's petition
and schedules with the debtor face-to-face. The debtor
is required to answer questions under penalty of perjury
concerning the debtor's acts, conduct, property, liabilities,
financial condition, and any matter that may affect administration
of the estate or the debtor's right to a discharge. This
information enables the trustee or representative of the
United States Trustee's Office to understand the debtor's
circumstances and facilitates the efficient administration
of the case.
section 341 hearing is referred to as the "Meeting
of Creditors" because creditors may attend and question
the debtor about the location and disposition of assets
and any other matter relevant to the administration of
the case. However, creditors are not required to attend
these hearings and, in general, do not waive their rights
by failing to appear.
hearing usually lasts a few minutes. The trustee or representative
of the United States Trustee's Office may continue the
hearing if he or she is not satisfied with the information
the debtor provides.
a husband and wife file a joint petition, they must both
appear. If you have a problem attending the creditor's
meeting, please contact your trustee. Since this meeting
is set by the U.S. Trustee and not by the Clerk's Office,
please do not file requests to continue or change the
date of this meeting with the Court.
the debtor fails to appear, the trustee or representative
of the United States Trustee's Office may request that
the Court dismiss the bankruptcy or order the debtor to
cooperate or be held in contempt of court for willful
failure to cooperate.
In a chapter 13 case, the debtor must submit a Repayment
Plan. Creditors have an opportunity to object to the plan.
If no one objects to the debtor's proposed plan, the Court
will enter an order confirming the plan as filed. Once
the plan is confirmed, the trustee will distribute the
proceeds of the debtor's plan payments to creditors until
the debtor completes the plan or the court dismisses or
converts the case.
Court will issue an order discharging the debtor, and
the trustee will prepare a final report, once the debtor
completes payments under the chapter 13 plan.
a chapter 12 case, the confirmation hearing must be concluded
within forty-five (45) days of filing the plan. The Court
may consider dismissal of the case if a plan is not confirmed.
In a chapter 11 case, the United States Trustee holds
a debtor's conference before the creditors' meeting. At
the Debtor's Conference, the United States Trustee will
go over the responsibilities and restrictions on the debtor-in-possession,
explain the quarterly fees and monthly operating reports,
and generally discuss the financial situation of the debtor
and the scope of the anticipated plan of reorganization.
A Reaffirmation Agreement is an agreement by which a debtor
becomes legally obligated to pay all or a portion of an
otherwise dischargeable debt. In order to be effective
and enforceable, the agreement must be filed in your bankruptcy
the reaffirming debtor is not represented by an attorney,
the Court will hold a hearing on the agreement. In some
instances, the Court will hold a hearing even where the
debtor is represented by counsel. The debtor must appear
in person at the hearing.
judge will ask questions to determine whether the reaffirmation
agreement imposes an undue burden on you or your dependents
and whether it is in your best interest. Since reaffirmed
debts are not discharged, the Bankruptcy Court will normally
permit you to reaffirm only secured debts where the collateral
is important to your daily activities.
you desire to reaffirm any particular debt, you must enter
into a written agreement with the creditor. There are
no forms for this purpose available from the Clerk's Office.
If you purchased your bankruptcy forms and have an application
for reaffirming a debt in your forms packet, do not file
it with your petition. File it only after you and the
creditor have both signed the reaffirmation agreement.
Attach the agreement to the application and file it with
may want to contact the creditor and have them prepare
the reaffirmation agreement. It must be filed with the
Court prior to the date in the Discharge of Debts section
of the notice regarding your meeting of creditors. Since
you are not represented by an attorney, a hearing, of
which you will receive written notice, may be set before
the bankruptcy judge. If filing jointly, you and your
spouse both need to appear at the hearing so the judge
may determine whether the reaffirmation agreement is in
your best interest.
be advised that the Court does not need to approve a reaffirmation
agreement that applies to a debt which is a consumer debt
secured by real property. This applies to any mortgages
on your home or other debts which are secured by your
if you sign a reaffirmation agreement, you have a minimum
of sixty (60) days after you file the agreement to change
your mind and rescind the agreement. If your discharge
date is more than sixty (60) days after you file the agreement,
you have until your discharge date to rescind the agreement.
you reaffirm a debt and fail to make the payments as agreed,
the creditor can take action against you to recover any
property that secures the debt, and you will be personally
liable for any remaining debt to that creditor.
Some creditors may have liens on certain property. The
lien holder has a special right to sell that property
on which it has a lien, known as "collateral,"
and use the proceeds to satisfy its claim. The property
"secures" the debt, so the lien holder is said
to have a "secured claim." Generally, bankruptcy
leaves a creditor's lien in place. This means that, despite
the bankruptcy filing, the creditor can sell the collateral
to satisfy its claim.
Bankruptcy Code allows a debtor to Redeem Collateral.
An individual debtor can keep certain kinds of collateral
(tangible, personal property intended primarily for personal,
family, or household use), by paying the holder of a lien
on the property the amount of its "allowed secured
claim," which typically means the lesser of the amount
owed or the value of the property.
the option to redeem, a debtor could not keep the collateral
without first entering into a reaffirmation agreement
and becoming legally obligated again on the entire debt,
even though it may exceed the value of the collateral.
option to redeem applies only to property that a debtor
has claimed as exempt or that the trustee has abandoned.
With redemption, a debtor can often get liens released
on personal household possessions for less than the underlying
debt on those secured possessions. Unless the creditor
consents to payments over time, a debtor must generally
pay the redemption amount in one lump-sum payment to the
Bankruptcy Petition Amendments
If you want to amend your Bankruptcy Petition to include
any creditors that you may have overlooked when filing
your original schedules, you must file an amendment. Amendments
to Schedules D, E or F require a $26 filing fee. The Clerk's
Office does not have forms for this purpose. If you file
an amendment, you must mail a copy to the creditors listed
and to the trustee assigned to your case. Please note
on the amendment that you have mailed a copy to the creditors