The Do's & Dont's Of Chapter 7

Last Updated: Saturday, April 25, 2020

Introduction

As is the case with just about every aspect of both civil and criminal matters, a great deal incorrect information abounds about bankruptcy law all over the Internet. So here is a short list of some important things to remember to both do and not do if you are contemplating filing Chapter 7 in order to achieve relief from your personal debts.

• Do not make an attempt to hide any information, assets or transactions from the Bankruptcy Court. You could go to prison for a bankruptcy crime and you will lose the asset once found. You will also very likely lose the prime benefit of your bankruptcy case, your bankruptcy discharge of most of your debts.
• Do not destroy or fail to maintain your financial records for one year prior to filing bankruptcy. Without that information, you will not be able to obtain a bankruptcy discharge.
• Do not lie, cheat or provide a false statement to your attorney or the bankruptcy court. It is just foolish and dumb, and again will imperil your bankruptcy discharge. It is usually pointless (and costly) to file a bankruptcy case that fails to achieve a discharge.
• Do assist us as requested because bankruptcy cases can have some very strict deadlines. Make sure you provide us with the information we ask for within the deadline requested.

You are required to comply with all requests of the U.S. Trustee Office (a division of the U.S. Department of Justice) and your Chapter 7 bankruptcy trustee.

If you are detailed and candid, your chapter 7 bankruptcy will usually take four to six months to be completed. Bankruptcy debtors with more complicated asset profiles (i.e. the ownership of an active business) or contentious debts (i.e. allegations of fraud) can take substantially longer

Credit Counseling

Within 180 days prior to your filing bankruptcy, you are required to take a credit counseling course from an approved non‑profit budget and credit counseling agency under the Bankruptcy Code. There is also a second course which is required to be taken after you file the bankruptcy but before you will receive your bankruptcy discharge of debts.

This second course is titled: Personal Financial Management Education. Please ask us and we will send you a list of credit counseling agencies which allow either online or in‑person attendance. Fees for these courses are minimal but their completion is required by law.

Effect On Your Credit

If you are overextended with credit balances and you have charge‑offs or settlements, your credit will usually repair faster with a bankruptcy. It is specific to your case, so please ask us. A typical bankruptcy will:

• Remain on your credit report for seven to ten years;
• It will likely take two years from your date of discharge to obtain conventional mortgages. There are lender available to discharged debtors within ninety of discharge but this depends on your financial position (for example, your salary going forward) as well as credit market conditions, which can change as general economic conditions vary. Please ask us about this.
• Many credit card companies will offer you credit within ninety days of discharge depending on your financial position. If you do not have steady verifiable income then it will take you longer to be offered a credit card.

Please call us to schedule your appointment for a Free Bankruptcy Consultation at one of our two conveniently located bankruptcy law offices either in Fort Lauderdale or Gainesville.