What Happens in a Consumer Chapter 7?
What Happens in a Consumer Chapter 7 Bankruptcy?
Filed Consumer Chapter 7 Bankruptcy – What Happens Now?
After analyzing your financial situation and determining that Chapter 7 is the best choice for you, we will do an extensive bankruptcy intake with you to obtain the information we need to complete your statements and schedules. It is very important that you are truthful with the information you provide to us, because filing untruthful information on your bankruptcy documents is a federal crime.
After your bankruptcy documents have been filed with the court, a Chapter 7 trustee will be appointed to your case. The trustee will send you a questionnaire they will want you to answer. The questionnaire will also ask for copies of supporting documents. It is your job to provide the trustee with a response to the questionnaire, but we are here to help if you need it.
After your documents are filed, a date for the creditor’s meeting, also known as the 341 meeting, will be set. We will prepare you for that meeting and go with you. The trustee will put you under oath and ask you questions about your statements and schedules. He or she may also ask for additional information. It is important to provide the trustee with everything he or she asks for and be truthful with all answers.
It is the trustee’s job to make sure you have disclosed all your assets and to obtain from you any and all non-exempt assets. A consumer bankruptcy debtor is allowed to keep certain property that is exempt under Arizona law. Arizona law is generous with its exemptions. (Click here for a list of Arizona exemptions).
All non-exempt assets must be turned over to the Chapter 7 trustee, who will then sell the property and distribute the proceeds to your unsecured creditors. If you have non-exempt assets, such as a boat or other property not listed under Arizona exemptions, and you want to keep that property, a Chapter 13 offers a better solution, because it allows you to keep non-exempt assets.
One non-exempt asset the trustee under either chapter will go after is your tax refund. If you received a tax refund in the past or expect to receive one in the future, it is important that you tell us about it at the time of the bankruptcy intake.
If there are no non-exempt assets for the trustee to collect, you will receive a discharge order from the court, discharging your debts, and your case will close.
If there are non-exempt assets for the trustee to collect, the trustee will keep your case open until he or she has collected and sold the non-exempt assets and distributed the proceeds to your creditors. After that, the trustee will file a report with the court about how much was collected and distributed and will then close your case. In this way, your case may stay open a little longer after you receive a discharge order from the court.
Start Your Chapter 7 Consumer Bankruptcy Case Today
During our initial consultation, we will help you review your financial situation, assess your options and choose the best course of action for you and your family. To learn more, we encourage you to contact us to schedule an appointment. Please contact us online or call our offices in Phoenix or Cottonwood at 602-275-3238.
If you are seriously considering Bankruptcy as an option to get out from under your debt,
contact us today to schedule a consultation.