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I’ve Decided to File for Chapter 7 Bankruptcy in Maryland—What Happens Now?

Form that reads ch. 7 & 13

After discussing your financial situation with an experienced consumer law attorney, you’ve decided to file for bankruptcy. Congratulations on taking a step toward a clean slate and a brighter financial future.  What happens next? How long should you expect the process to take? What do you need to do? Learn more about the timeline of a Chapter 7 bankruptcy, below.

Step 1: Complete Credit Counseling and File a Petition

Initiating a bankruptcy proceeding requires you to file a bankruptcy petition. Your attorney will complete the petition on your behalf, with your help. Gather any financial documents you may have, such as account statements, title documents to any property you own, or loan origination documents, and provide them to your bankruptcy lawyer to assist in the petition completion process. This is the point at which your attorney will determine whether or not all of your assets will be covered by property exemptions. Assets which are deemed non-exempt may need to be turned over to the bankruptcy court. After your petition is filed, an automatic stay is put in place, preventing your creditors from contacting you directly about your debts, and putting a hold on any foreclosures in process.

Prior to filing your petition, you will need to complete a mandatory credit counseling course and provide evidence of its completion to the court; you will also need to complete a financial management class prior to the granting of your discharge. In a future post, we will explain what to expect from these classes.

Step 2: Trustee is assigned

Once your petition is filed with the court, you will be assigned a bankruptcy trustee. This person will be the liaison between you and your creditors, assuring that your creditors receive as great a settlement as possible on your debts. If you do have any non-exempt assets, and the trustee determines that they are of high enough value to be worth selling, the trustee will be tasked with their sale, and with turning over the profits to your creditors. The trustee will also ensure that your petition appears accurate, and will have the power to approve or reject your petition.

Step 3: Attend a Meeting of Creditors, or 341 Meeting

Between 30 and 40 days after your petition is filed, the trustee will arrange for a meeting of creditors, also known as a § 341 meeting. While this is technically an opportunity for your creditors to ask questions about your financial state and petition, creditors rarely appear at these meetings. At this meeting, you will be asked to prove your identity, and will likely be asked questions by the trustee about your petition. These meetings tend to be brief, and your attorney will make sure you’re fully prepared by explaining what questions you can expect to answer at the meeting.

Step 4: Discharge of debts

Provided that none of your creditors nor your trustee object to your filing, your discharge of debts will be granted by the bankruptcy court. You will receive a letter in the mail making your discharge official. Depending on whether or not the trustee sold any of your assets to satisfy your debts, or required any extra documentation during the course of considering your case, your discharge will likely be granted within 100 days of your § 341 meeting.

If you are considering bankruptcy in Maryland and would like guidance from an experienced consumer law attorney on the process of getting out of debt, contact the skilled and knowledgeable Germantown consumer attorneys at Haeger Law for a consultation, at 888-463-3520.