How Your Bankruptcy Attorney Starts the Process
We usually start with an intake interview to get a general idea of whether or not you qualify for bankruptcy. Most people who reach out to us are hoping to file a Chapter 7 Bankruptcy and that is the most common type. In a Chapter 7, a client’s information is collected by the bankruptcy attorney and presented in a petition seeking to get a court order discharging the client’s debts. If the preliminary interview suggests that you qualify for a Chapter 7 bankruptcy, we provide you with a questionnaire so that we can get all the necessary information from you. Hire and Experienced Rhode Island Bankruptcy Attorney
Our offices use the latest technology and best bankruptcy software to collect and process your financial information. We have an online, secure portal you can use to provide us with your financial information at your own pace. When we have all the information we review it to make a final determination of your eligibility for bankruptcy relief.
If you qualify you can hire us to represent you and complete the petition for you. We will then send a draft petition to you for your review and revision. Once the petition is completed properly and to your satisfaction, we will file it for you electronically as required by the Bankruptcy Court.
Filing Your Bankruptcy Petition
The Bankruptcy Court in Rhode Island charges a $338 filing fee, which may usually be paid in four monthly payments of $84.50, if paying in a lump sum is impossible. Prior to filing you will need to take a credit counselling course. I use Start Fresh Today Bankruptcy Solutions which provides certificates that are approved in almost all bankruptcy courts, including the one in Rhode Island. The cost for the course is nominal.
Once the petition is filed the court enters an “Automatic Stay.” The entry of an Automatic Stay means your creditors may not continue to try to collect their debts or take any action against you or even call you. When you are granted a discharge, they may never attempt to collect from you again on the dischargeable debts you listed.
However, secured debts remain secured. If you are behind in your payments for a secured debt, such as a mortgage, you must work out a plan with your bankruptcy attorney to address arrearages before you file your Chapter 7 bankruptcy or perhaps file a Chapter 13 instead. (A payment plan bankruptcy) It is also possible to do a loan modification as part of the bankruptcy case.
After Your Bankruptcy Attorney Files the Petition
After the petition is filed, we will need to upload copies of your pay stubs from the 60 days preceding the filing. A bankruptcy trustee will be assigned to your case and a date for the 341 meeting will be scheduled. The bankruptcy trustee is not a judge, though he or she is usually a bankruptcy attorney. They oversee your petition and confirm that it satisfies the relevant legal requirements.
If you have more assets than you are entitled to keep, they will sell those assets to pay towards your debts. Most Chapter 7 cases do not result in asset sales as most people who file Chapter 7 do not have more property than they are allowed to exempt. Exemptions are an amount of value in a property that you may keep even though you are filing Chapter 7 and are usually sufficient protection. The exemptions are pretty generous.
If you have property that exceeds the exemptions we will be able to tell you that before you file based on the information you provide to us. It’s not often a problem as the exemptions are usually enough to cover everything you own.
The 341 Creditors Meeting
The trustee will preside over the 341 meeting, which will occur 25 – 35 days after the petition is filed. At least a week before the date of the meeting your bankruptcy attorney will submit to the trustee your latest tax return, copies of the last three months of your bank statements and possibly some other documentation.
In Rhode Island, the 341 meetings are held in the same building as the bankruptcy court is in, but they are not done in a courtroom. They are done in a long room with several rows of chairs. At the front of the room is a table at which the trustee sits, with a stack of files and a tape recorder. Lately, because of Covid, the meetings have been done telephonically, not in person.
At the 341 meeting, there will be approximately 15 cases processed in a one hour period. When your name is called you will proceed to the table at the end of the room with your bankruptcy attorney and you will present your identification papers and be sworn in. When it is done telephonically, you stay on the line with your phone muted until your case is called.
What You and Your Bankruptcy Attorney Need to Bring to the Meeting
The debtor must bring two (2) forms of proof of identification. Individual debtors must provide picture identification and proof of social security number to the trustee at the meeting of creditors. These documents should be originals, not copies. However, for telephonic hearings your bankruptcy attorney will collect copies of these materials from you and submit them to trustee electronically. Acceptable forms of picture identification include:
1. driver’s license
2. government, state, student or military ID
3. US passport
4. resident alien card
Acceptable forms of proof of social security number include:
1. social security card
2. medical insurance card
3. pay stub, W-2 form, IRS form 1099
4. social security administration form
What Happens at the Meeting
The 341 meeting is also called “The First Meeting of the Creditors.” This is because this meeting is an opportunity for creditors to question the petitioners. Although this used to be a regular occurrence and may still happen now, it is unusual for creditors to attend these meeting. There is no financial benefit to them for doing so unless they believe there is a valid reason that you should not receive a discharge or that you have assets that should not be exempt. This does not happen in routine cases. It is rare for a creditor to attend.
For the most part, the trustee will just walk you through your petition and confirm that what you have filed is correct. Your bankruptcy attorney will be present but the trustee will expect you to answer the questions, not the attorney. If the trustee needs any more information, the trustee will usually schedule another meeting but you may not need to attend the second meeting if you provide the trustee with the documents he or she requested before the new meeting date. Prior to the case being closed, you will need to take an online financial management course. You will use the same website you used for the pre-filing course.
Your Bankruptcy Discharge
Within 30 days of the meeting, you have to complete the second required course. Approximately, 60 days after the meeting your bankruptcy attorney will send you a copy of your discharge and shortly thereafter your case will be closed. You will be relieved of any unsecured, non-priority debt you listed in your petition and you may begin to rebuild your financial security!