Bankruptcy Laws: You Can File Bankruptcy Without Lawyer
The United States Constitution provides a method whereby individuals, burdened by excessive debt, can obtain a "fresh start" and
pursue productive lives unimpaired by past financial problems. It is an important alternative for persons strapped with more debt and
stress than they can handle.
The federal bankruptcy laws were enacted to provide good, honest, hard-working debtors with a fresh start and to establish a ranking
and equity among all the creditors clamoring for the debtor's limited resources.
Bankruptcy helps people avoid the kind of permanent discouragement that can prevent them from ever re-establishing themselves
as hard working members of society.
To the extent that there may be money or property available for distribution to creditors, creditors are ranked to make sure that money
or property is fairly distributed according to established rules as to which creditors get what.
This discussion is intended only as a brief overview of the types of bankruptcy filings and of what a bankruptcy filing can and cannot
do. No one should base their decision as to whether or not to file bankruptcy solely on this information. Bankruptcy law is complex,
and there are many considerations that must be taken into account in making the determination whether or not to file. Anyone
considering bankruptcy is encouraged to make no decision about bankruptcy without seeking the advice and assistance of an
experienced attorney who practices nothing but bankruptcy law.
Types of Bankruptcy
The Bankruptcy Code is divided into chapters. The chapters which almost always apply to consumer debtors are chapter 7, known
as a "straight bankruptcy", and chapter 13, which involves an affordable plan of repayment.
An important feature applicable to all types of bankruptcy filings is the automatic stay. The automatic stay means that the mere
request for bankruptcy protection automatically stops and brings to a grinding halt most lawsuits, repossessions, foreclosures,
evictions, garnishments, attachments, utility shut offs, and debt collection harassment. It offers debtors a breathing spell by giving
the debtor and the trustee assigned to the case time to review the situation and develop an appropriate plan. In most circumstances,
creditors cannot take any further action against the debtor or the property without permission from the bankruptcy court.
Chapter 7
In a chapter 7 case, the bankruptcy court appoints a trustee to examine the debtor's assets to determine if there are any assets not
protected by available "exemptions". Exemptions are laws that allow a debtor to keep, and not part with, certain types and amounts
of money and property. For example, exemption laws allows a debtor to protect a certain amount of equity in the debtor's residence,
motor vehicle, household goods, life insurance, health aids, retirement plans, specified future earnings such as social security
benefits, child support, and alimony, and certain other types of personal property. If there is any non-exempt property, it is the
Trustee's job to sell it and to distribute the proceeds among the unsecured creditors. Although a liquidation case can rarely help with
secured debt (the secured creditor still has the right to repossess the collateral if the debtor falls behind in the monthly payments),
the debtor will be discharged from the legal obligation to pay unsecured debts such as credit card debts, medical bills and utility
arrearages. However, certain types of unsecured debt are allowed special treatment and cannot be discharged. These include some
student loans, alimony, child support, criminal fines, and some taxes.
Additional information about chapter 7 is available at the Site.
In addition to attorney fees, there is a filing fee that must be paid to the Bankruptcy Court.
Chapter 13
In a chapter 13 case, the debtor puts forward a plan, following the rules set forth in the bankruptcy laws, to repay certain creditors
over a period of time, usually from future income. A chapter 13 case may be advantageous in that the debtor is allowed to get caught
up on mortgages or car loans without the threat of foreclosure or repossession, and is allowed to keep both exempt and nonexempt
property. The debtor's plan is a document outlining to the bankruptcy court how the debtor proposes to dispose of the claims of the
debtor's creditors. The debtor's property is protected from seizure from creditors, including mortgage and other lien holders, as long
as the proposed payments are made and necessary insurance coverages remain in place. The plan generally requires monthly
payments to the bankruptcy trustee over a period of three to five years. Arrangements can be made to have these payments made
automatically through payroll deductions.
Additional information about chapter 13 is available at the Site.
In addition to attorney fees, there is a filing fee that must be paid to the Bankruptcy Court.
Chapter 11
By and large, chapter 11 is a type of bankruptcy reserved for large corporate reorganizations. Chapter 11 shares many of the qualities
of a chapter 13, but tends to involve much more complexity on a much larger scale. However, since chapter 11 does not usually
pertain to individuals whose debts are primarily consumer debts, further information about chapter 11 will be provided by reference
to the following resource: The A Bankruptcy Basics @ brochure prepared by the Administrative Office of the United States Courts,
dated June 2000, and which can be accessed over the Internet by visiting the following website: www.uscourts.gov/bankruptcycourts.
html .
Chapter 12
Chapter 12 of the Bankruptcy Code was enacted by Congress in 1986, specifically to meet the needs of financially distressed family
farmers. The primary purpose of this legislation was to give family farmers facing bankruptcy a chance to reorganize their debts and
keep their farms.
However, as with chapter 11, since chapter 12 does not usually pertain to individuals whose debts are primarily consumer debts,
further information about chapter 12 will be provided by reference to the same "Bankruptcy Basics" brochure referred to above, which
can be accessed over the Internet at the same said website as mentioned for chapter 11.
What Bankruptcy Can and Cannot Do
Bankruptcy may make it possible for financially distressed individuals to:
1. Discharge liability for most or all of their debts and get a fresh start. When the debt is discharged, the debtor has no further legal
obligation to pay the debt.
2. Stop foreclosure actions on their home and allow them an opportunity to catch up on missed payments.
3. Prevent repossession of a car or other property, or force the creditor to return property even after it has been repossessed.
4. Stop wage garnishment and other debt collection harassment, and give the individual some breathing room.
5. Restore or prevent termination of certain types of utility service.
6. Lower the monthly payments and interest rates on debts, including secured debts such as car loans.
7. Allow debtors an opportunity to challenge the claims of certain creditors who have committed fraud or who are otherwise seeking
to collect more than they are legally entitled to.
Bankruptcy, however, cannot cure every financial problem. It is usually not possible to:
1. Eliminate certain rights of secured creditors. Although a debtor can force secured creditors to take payments over time in the
bankruptcy process, a debtor generally cannot keep the collateral unless the debtor continues to pay the debt.
2. Discharge types of debts singled out by the federal bankruptcy statutes for special treatment, such as child support, alimony,
student loans, certain court ordered payments, criminal fines, and some taxes.
3. Protect all cosigners on their debts. If relative or friend co signed a loan which the debtor discharged in bankruptcy, the cosigner
may still be obligated to repay whatever part of the loan not paid during the pendency of the bankruptcy case.
4. Discharge debts that are incurred after bankruptcy has been filed.
Bankruptcy's Effect on Your Credit
By federal law, a bankruptcy can remain part of a debtor's credit history for 10 years. Whether or not the debtor will be granted credit in
the future is unpredictable, and probably depends, to a certain extent, on what good things the debtor does in the nature of keeping a
job, saving money, making timely payments on secured debts, etc.
Services Available From Credit Counseling Agencies
With limited exceptions, Section 109(h) of the Bankruptcy Code requires that all individuals who file for bankruptcy relief on or after
October 17, 2005 receive a briefing that outlines all available opportunities for credit counseling and provides assistance in
performing a budget analysis. The briefing must be given within 180 days prior to the bankruptcy filing. The briefing may be provided
individually or in a group (including briefings conducted over the Internet or over the telephone) and must be provided by a non-profit
budget and credit counseling agency approved by the United States Trustee or bankruptcy administrator. The clerk of the bankruptcy
court has a list that you may consult of the approved budget and credit counseling agencies. In addition, after filing a bankruptcy
case, an individual debtor generally must complete a financial management instructional course before he or she can receive a
discharge. The clerk also has a list of approved financial management instructional courses.
If you're not disciplined enough to create a workable budget and stick to it, can't work out a repayment plan with your creditors, can't
keep track of mounting bills, or need more help with your debts than can be achieved by merely having a few of your unsecured
creditors lower your interest rates somewhat, it probably makes little sense to consider contacting a credit counseling organization.
If, on the other hand, you meet all or most of those criteria, there are many non-profit credit counseling organizations that will work
with you to solve your financial problems. But be aware that, just because an organization says it's "nonprofit," there's no guarantee
that its services are free, affordable or even legitimate. Most credit counselors offer services through local offices, the Internet, or on
the telephone. If possible, it probably best to find an organization that offers in-person counseling. Many universities, military bases,
credit unions, housing authorities, and branches of the U.S. Cooperative Extension Service operate nonprofit credit counseling
programs. Your financial institution, local consumer protection agency, and friends and family also may be good sources of
information and referrals.
Reputable credit counseling organizations can advise you on managing your money and debts, help you develop a budget, and offer
free educational materials and workshops. Their counselors are certified and trained in the areas of consumer credit, money and
debt management, and budgeting. Legitimate counselors will discuss your entire financial situation with you, and help you develop a
personalized plan to solve your money problems. An initial counseling session typically lasts an hour, with an offer of follow-up
sessions.
If your financial problems stem from too much debt or your inability to repay your debts, a credit counseling agency may recommend
that you enroll in what is knows as a "debt management plan" or "DMP." A DMP alone is not credit counseling, and DMPs are not
for everyone. You should sign up for one of these plans only after a certified credit counselor has spent time thoroughly reviewing
your financial situation, has offered you customized advice on managing your money, and has analyzed your budget to make sure
that the proposed DMP is one you can afford. However, remember that all organizations that promote DMP's fund themselves in part
through arrangements with the creditors involved, which are called "fair share", so you have to be wary as to whose best interest the
counselor has in mind. Even if a DMP is not appropriate for you, a reputable credit counseling organization still can help you create a
budget and teach you money management skills.
In a DMP, you deposit money each month with the credit counseling organization, which uses your deposits to pay your unsecured
debts, like your credit card bills and medical bills, according to a payment schedule the counselor develops with your creditors. Your
creditors may agree to lower your interest rates or waive certain fees, but it's always best to check with all your creditors, just to make
sure they offer the concessions that a credit counseling organization is promising you. A successful DMP requires you to make
regular, timely payments, and could take 48 months or more to complete. Ask the credit counselor to estimate how long it will take for
you to complete the plan. You may have to agree not to apply for C or use C any additional credit while you're participating in the plan,
and a DMP is likely of little value if your problems stem from or involve your secured creditors holding your car, truck or home as
collateral. DMP's are also likely of little value if your problems stem from alimony, child support or overdue taxes.
The bottom line is this: If all you need is a little lowering of your interest rates on some unsecured debts, a DMP might be the answer.
However, if what you really need is to reduce the amount of your debt, bankruptcy may be the solution.
NOTICE NO. 2
Notice Mandated By Section 527(a)(2) Of The Bankruptcy Code
NOTICE OF MANDATORY DISCLOSURE
TO CONSUMERS WHO CONTEMPLATE FILING BANKRUPTCY
You are notified as follows:
1. All information that you are required to provide with the filing of your case and thereafter, while your case is pending, must be
complete, accurate and truthful.
2. All your assets and all your liabilities must be completely and accurately disclosed in the documents filed to commence your case,
and the replacement value of each asset (as defined in Section 506 of the Bankruptcy Code) must be stated in those documents
where requested after reasonable inquiry to establish such value.
3. Some sections of the Bankruptcy Code require you to determine and list the replacement value of an asset such as a car or
furniture. When replacement value is required, it means the replacement value, established after reasonable inquiry, as of the date
of the filing of your bankruptcy case, without deduction for costs of sales or marketing. With respect to property acquired for personal,
family or household purposes, replacement value means the price a retail merchant would charge for "used" property of that kind
considering the age and condition of the property. Again, replacement value is defined in the Bankruptcy Code as the price that a
retail merchant would charge for property of the same kind, considering the age and condition of the property at the time its value is
determined. This is not the cost to replace the item with a new one or what you could sell the item for; it is the cost at which a retail
merchant would sell the used item in its current condition. In many cases (particularly used clothing, furniture, computers, etc.), this
would be “yard sale” value, or what the item might sell for on eBay. In other cases, such as jewelry, antiques or collectables, it may
be retail value. For motor vehicles, it would be the third party purchase value. For real property, it is what the real property would sell
for, at current Market value. For cash and bank accounts, it is the actual amount on deposit. For stocks and bonds, it is their market
value as of the date your case is filed. You must make a reasonable inquiry to determine the replacement value of your assets.
4. Before your case can be filed, it is subject to what is called "Means Testing." The Means Test was designed to determine whether
or not you qualify to file a case under chapter 7 of the Bankruptcy Code, and if not, how much you need to pay your unsecured
creditors in a chapter 13 case. For purposes of means test, you must state, after reasonable inquiry, your total current monthly
income, the amount of all expenses as specified and allowed pursuant to section 707(b)(2) of the bankruptcy code, and if the plan is
to file in a Chapter 13 case, you must state, again after reasonable inquiry, your disposable income, as that term is defined.
5. Information that you provide during your case may be audited pursuant to the provisions of the Bankruptcy Code. Your failure to
provide complete, accurate and truthful information may result in the dismissal of your case or other sanctions, including criminal
sanctions.
pursue productive lives unimpaired by past financial problems. It is an important alternative for persons strapped with more debt and
stress than they can handle.
The federal bankruptcy laws were enacted to provide good, honest, hard-working debtors with a fresh start and to establish a ranking
and equity among all the creditors clamoring for the debtor's limited resources.
Bankruptcy helps people avoid the kind of permanent discouragement that can prevent them from ever re-establishing themselves
as hard working members of society.
To the extent that there may be money or property available for distribution to creditors, creditors are ranked to make sure that money
or property is fairly distributed according to established rules as to which creditors get what.
This discussion is intended only as a brief overview of the types of bankruptcy filings and of what a bankruptcy filing can and cannot
do. No one should base their decision as to whether or not to file bankruptcy solely on this information. Bankruptcy law is complex,
and there are many considerations that must be taken into account in making the determination whether or not to file. Anyone
considering bankruptcy is encouraged to make no decision about bankruptcy without seeking the advice and assistance of an
experienced attorney who practices nothing but bankruptcy law.
Types of Bankruptcy
The Bankruptcy Code is divided into chapters. The chapters which almost always apply to consumer debtors are chapter 7, known
as a "straight bankruptcy", and chapter 13, which involves an affordable plan of repayment.
An important feature applicable to all types of bankruptcy filings is the automatic stay. The automatic stay means that the mere
request for bankruptcy protection automatically stops and brings to a grinding halt most lawsuits, repossessions, foreclosures,
evictions, garnishments, attachments, utility shut offs, and debt collection harassment. It offers debtors a breathing spell by giving
the debtor and the trustee assigned to the case time to review the situation and develop an appropriate plan. In most circumstances,
creditors cannot take any further action against the debtor or the property without permission from the bankruptcy court.
Chapter 7
In a chapter 7 case, the bankruptcy court appoints a trustee to examine the debtor's assets to determine if there are any assets not
protected by available "exemptions". Exemptions are laws that allow a debtor to keep, and not part with, certain types and amounts
of money and property. For example, exemption laws allows a debtor to protect a certain amount of equity in the debtor's residence,
motor vehicle, household goods, life insurance, health aids, retirement plans, specified future earnings such as social security
benefits, child support, and alimony, and certain other types of personal property. If there is any non-exempt property, it is the
Trustee's job to sell it and to distribute the proceeds among the unsecured creditors. Although a liquidation case can rarely help with
secured debt (the secured creditor still has the right to repossess the collateral if the debtor falls behind in the monthly payments),
the debtor will be discharged from the legal obligation to pay unsecured debts such as credit card debts, medical bills and utility
arrearages. However, certain types of unsecured debt are allowed special treatment and cannot be discharged. These include some
student loans, alimony, child support, criminal fines, and some taxes.
Additional information about chapter 7 is available at the Site.
In addition to attorney fees, there is a filing fee that must be paid to the Bankruptcy Court.
Chapter 13
In a chapter 13 case, the debtor puts forward a plan, following the rules set forth in the bankruptcy laws, to repay certain creditors
over a period of time, usually from future income. A chapter 13 case may be advantageous in that the debtor is allowed to get caught
up on mortgages or car loans without the threat of foreclosure or repossession, and is allowed to keep both exempt and nonexempt
property. The debtor's plan is a document outlining to the bankruptcy court how the debtor proposes to dispose of the claims of the
debtor's creditors. The debtor's property is protected from seizure from creditors, including mortgage and other lien holders, as long
as the proposed payments are made and necessary insurance coverages remain in place. The plan generally requires monthly
payments to the bankruptcy trustee over a period of three to five years. Arrangements can be made to have these payments made
automatically through payroll deductions.
Additional information about chapter 13 is available at the Site.
In addition to attorney fees, there is a filing fee that must be paid to the Bankruptcy Court.
Chapter 11
By and large, chapter 11 is a type of bankruptcy reserved for large corporate reorganizations. Chapter 11 shares many of the qualities
of a chapter 13, but tends to involve much more complexity on a much larger scale. However, since chapter 11 does not usually
pertain to individuals whose debts are primarily consumer debts, further information about chapter 11 will be provided by reference
to the following resource: The A Bankruptcy Basics @ brochure prepared by the Administrative Office of the United States Courts,
dated June 2000, and which can be accessed over the Internet by visiting the following website: www.uscourts.gov/bankruptcycourts.
html .
Chapter 12
Chapter 12 of the Bankruptcy Code was enacted by Congress in 1986, specifically to meet the needs of financially distressed family
farmers. The primary purpose of this legislation was to give family farmers facing bankruptcy a chance to reorganize their debts and
keep their farms.
However, as with chapter 11, since chapter 12 does not usually pertain to individuals whose debts are primarily consumer debts,
further information about chapter 12 will be provided by reference to the same "Bankruptcy Basics" brochure referred to above, which
can be accessed over the Internet at the same said website as mentioned for chapter 11.
What Bankruptcy Can and Cannot Do
Bankruptcy may make it possible for financially distressed individuals to:
1. Discharge liability for most or all of their debts and get a fresh start. When the debt is discharged, the debtor has no further legal
obligation to pay the debt.
2. Stop foreclosure actions on their home and allow them an opportunity to catch up on missed payments.
3. Prevent repossession of a car or other property, or force the creditor to return property even after it has been repossessed.
4. Stop wage garnishment and other debt collection harassment, and give the individual some breathing room.
5. Restore or prevent termination of certain types of utility service.
6. Lower the monthly payments and interest rates on debts, including secured debts such as car loans.
7. Allow debtors an opportunity to challenge the claims of certain creditors who have committed fraud or who are otherwise seeking
to collect more than they are legally entitled to.
Bankruptcy, however, cannot cure every financial problem. It is usually not possible to:
1. Eliminate certain rights of secured creditors. Although a debtor can force secured creditors to take payments over time in the
bankruptcy process, a debtor generally cannot keep the collateral unless the debtor continues to pay the debt.
2. Discharge types of debts singled out by the federal bankruptcy statutes for special treatment, such as child support, alimony,
student loans, certain court ordered payments, criminal fines, and some taxes.
3. Protect all cosigners on their debts. If relative or friend co signed a loan which the debtor discharged in bankruptcy, the cosigner
may still be obligated to repay whatever part of the loan not paid during the pendency of the bankruptcy case.
4. Discharge debts that are incurred after bankruptcy has been filed.
Bankruptcy's Effect on Your Credit
By federal law, a bankruptcy can remain part of a debtor's credit history for 10 years. Whether or not the debtor will be granted credit in
the future is unpredictable, and probably depends, to a certain extent, on what good things the debtor does in the nature of keeping a
job, saving money, making timely payments on secured debts, etc.
Services Available From Credit Counseling Agencies
With limited exceptions, Section 109(h) of the Bankruptcy Code requires that all individuals who file for bankruptcy relief on or after
October 17, 2005 receive a briefing that outlines all available opportunities for credit counseling and provides assistance in
performing a budget analysis. The briefing must be given within 180 days prior to the bankruptcy filing. The briefing may be provided
individually or in a group (including briefings conducted over the Internet or over the telephone) and must be provided by a non-profit
budget and credit counseling agency approved by the United States Trustee or bankruptcy administrator. The clerk of the bankruptcy
court has a list that you may consult of the approved budget and credit counseling agencies. In addition, after filing a bankruptcy
case, an individual debtor generally must complete a financial management instructional course before he or she can receive a
discharge. The clerk also has a list of approved financial management instructional courses.
If you're not disciplined enough to create a workable budget and stick to it, can't work out a repayment plan with your creditors, can't
keep track of mounting bills, or need more help with your debts than can be achieved by merely having a few of your unsecured
creditors lower your interest rates somewhat, it probably makes little sense to consider contacting a credit counseling organization.
If, on the other hand, you meet all or most of those criteria, there are many non-profit credit counseling organizations that will work
with you to solve your financial problems. But be aware that, just because an organization says it's "nonprofit," there's no guarantee
that its services are free, affordable or even legitimate. Most credit counselors offer services through local offices, the Internet, or on
the telephone. If possible, it probably best to find an organization that offers in-person counseling. Many universities, military bases,
credit unions, housing authorities, and branches of the U.S. Cooperative Extension Service operate nonprofit credit counseling
programs. Your financial institution, local consumer protection agency, and friends and family also may be good sources of
information and referrals.
Reputable credit counseling organizations can advise you on managing your money and debts, help you develop a budget, and offer
free educational materials and workshops. Their counselors are certified and trained in the areas of consumer credit, money and
debt management, and budgeting. Legitimate counselors will discuss your entire financial situation with you, and help you develop a
personalized plan to solve your money problems. An initial counseling session typically lasts an hour, with an offer of follow-up
sessions.
If your financial problems stem from too much debt or your inability to repay your debts, a credit counseling agency may recommend
that you enroll in what is knows as a "debt management plan" or "DMP." A DMP alone is not credit counseling, and DMPs are not
for everyone. You should sign up for one of these plans only after a certified credit counselor has spent time thoroughly reviewing
your financial situation, has offered you customized advice on managing your money, and has analyzed your budget to make sure
that the proposed DMP is one you can afford. However, remember that all organizations that promote DMP's fund themselves in part
through arrangements with the creditors involved, which are called "fair share", so you have to be wary as to whose best interest the
counselor has in mind. Even if a DMP is not appropriate for you, a reputable credit counseling organization still can help you create a
budget and teach you money management skills.
In a DMP, you deposit money each month with the credit counseling organization, which uses your deposits to pay your unsecured
debts, like your credit card bills and medical bills, according to a payment schedule the counselor develops with your creditors. Your
creditors may agree to lower your interest rates or waive certain fees, but it's always best to check with all your creditors, just to make
sure they offer the concessions that a credit counseling organization is promising you. A successful DMP requires you to make
regular, timely payments, and could take 48 months or more to complete. Ask the credit counselor to estimate how long it will take for
you to complete the plan. You may have to agree not to apply for C or use C any additional credit while you're participating in the plan,
and a DMP is likely of little value if your problems stem from or involve your secured creditors holding your car, truck or home as
collateral. DMP's are also likely of little value if your problems stem from alimony, child support or overdue taxes.
The bottom line is this: If all you need is a little lowering of your interest rates on some unsecured debts, a DMP might be the answer.
However, if what you really need is to reduce the amount of your debt, bankruptcy may be the solution.
NOTICE NO. 2
Notice Mandated By Section 527(a)(2) Of The Bankruptcy Code
NOTICE OF MANDATORY DISCLOSURE
TO CONSUMERS WHO CONTEMPLATE FILING BANKRUPTCY
You are notified as follows:
1. All information that you are required to provide with the filing of your case and thereafter, while your case is pending, must be
complete, accurate and truthful.
2. All your assets and all your liabilities must be completely and accurately disclosed in the documents filed to commence your case,
and the replacement value of each asset (as defined in Section 506 of the Bankruptcy Code) must be stated in those documents
where requested after reasonable inquiry to establish such value.
3. Some sections of the Bankruptcy Code require you to determine and list the replacement value of an asset such as a car or
furniture. When replacement value is required, it means the replacement value, established after reasonable inquiry, as of the date
of the filing of your bankruptcy case, without deduction for costs of sales or marketing. With respect to property acquired for personal,
family or household purposes, replacement value means the price a retail merchant would charge for "used" property of that kind
considering the age and condition of the property. Again, replacement value is defined in the Bankruptcy Code as the price that a
retail merchant would charge for property of the same kind, considering the age and condition of the property at the time its value is
determined. This is not the cost to replace the item with a new one or what you could sell the item for; it is the cost at which a retail
merchant would sell the used item in its current condition. In many cases (particularly used clothing, furniture, computers, etc.), this
would be “yard sale” value, or what the item might sell for on eBay. In other cases, such as jewelry, antiques or collectables, it may
be retail value. For motor vehicles, it would be the third party purchase value. For real property, it is what the real property would sell
for, at current Market value. For cash and bank accounts, it is the actual amount on deposit. For stocks and bonds, it is their market
value as of the date your case is filed. You must make a reasonable inquiry to determine the replacement value of your assets.
4. Before your case can be filed, it is subject to what is called "Means Testing." The Means Test was designed to determine whether
or not you qualify to file a case under chapter 7 of the Bankruptcy Code, and if not, how much you need to pay your unsecured
creditors in a chapter 13 case. For purposes of means test, you must state, after reasonable inquiry, your total current monthly
income, the amount of all expenses as specified and allowed pursuant to section 707(b)(2) of the bankruptcy code, and if the plan is
to file in a Chapter 13 case, you must state, again after reasonable inquiry, your disposable income, as that term is defined.
5. Information that you provide during your case may be audited pursuant to the provisions of the Bankruptcy Code. Your failure to
provide complete, accurate and truthful information may result in the dismissal of your case or other sanctions, including criminal
sanctions.
Disclosure Notices Required Under the
Bankruptcy Law to Be Given Assisted Debtors
NOTE: OUR LEGAL AUTHORITY TO AID YOU.
Is there any specific legal authority by which we're authorized, as a federal Debt Relief Agency (also
called Bankruptcy Petition Preparer), to aid and assist you in bankruptcy filing? Absolutely! It comes
under the U.S. Bankruptcy Code or law by which we're authorized (See the NOTICE #3 and other
information below) to assist debtors seeking relief from their debts in bankruptcy cases.
The following legal provisions listed below on this page, are the LEGAL NOTICES (among others)
required to be given by us as a Debt Relief Agency, to debtors who hire us (YOU, if you hire us) to do
the bankruptcy document preparation work for them. To make it simpler for you to follow, the
documents are categorized as Notices 1, 2, 3 and 4.
BUT FIRST, NOTICE THE FOLLOWING...
But first, note that under the Notice #3 below, YOU are conferred the legal right, if you so want, to do
your own bankruptcy paperwork and file your bankruptcy yourself. Or, alternatively, you are legally
authorized, as well, if you so want, to engage the services of our company (as a Debt Relief Agency)
to do it for you. (Or, of course, if that is what you want or prefer, to hire a lawyer and him or her to do it
for you).
If you decide to seek bankruptcy relief, you can represent yourself, [or] you can hire an
attorney to represent you, or you can get help in some localities [where they're available] from a
bankruptcy petition preparer who is not an attorney.
NOTICE NO. 3
Notice Mandated By Section 527(b) Of The Bankruptcy Code
IMPORTANT INFORMATION ABOUT BANKRUPTCY ASSISTANCE SERVICES
If you decide to seek bankruptcy relief, you can represent yourself, [or] you can hire an attorney to represent you, or you can get
help in some localities from a bankruptcy petition preparer who is not an attorney. THE LAW REQUIRES AN ATTORNEY OR
BANKRUPTCY PETITION PREPARER TO GIVE YOU A WRITTEN CONTRACT SPECIFYING WHAT THE ATTORNEY OR
BANKRUPTCY PETITION PREPARER WILL DO FOR YOU AND HOW MUCH IT WILL COST. Ask to see the contract before you
hire anyone.
The following information helps you understand what must be done in a routine bankruptcy case to help you evaluate how
much service you need. Although bankruptcy can be complex, many cases are routine.
Before filing a bankruptcy case, either you or your attorney should analyze your eligibility for different forms of debt relief available
under the Bankruptcy Code and which form of relief is most likely to be beneficial for you. Be sure you understand the relief you
can obtain and its limitations. To file a bankruptcy case, documents called a Petition, Schedules and Statement of Financial
Affairs, as well as in some cases a Statement of Intention need to be prepared correctly and filed with the bankruptcy court. You
will have to pay a filing fee to the bankruptcy court. Once your case starts, you will have to attend the required first meeting of
creditors where you may be questioned by a court official called a trustee, and by creditors.
If you choose to file a chapter 7 case, you may be asked by a creditor to reaffirm a debt. You may want help deciding whether to
do so. A creditor is not permitted to coerce you into reaffirming your debts. It may not be in your best interest to reaffirm a debt.
If you choose to file a chapter 13 case in which you repay your creditors what you can afford over 3 to 5 years, you may also want
help with preparing your chapter 13 plan and with the confirmation hearing on your plan which, if held, will be before a bankruptcy
judge.
If you select another type of relief under the Bankruptcy Code other than chapter 7 or chapter 13, you will want to find out what
should be done from someone familiar with that type of relief. However, please be advised that in most cases, you will only be
concerned with chapter 7 and chapter 13.
Your bankruptcy case may also involve litigation. You are generally permitted to represent yourself in litigation in bankruptcy
court, but only attorneys, not bankruptcy petition preparers, can give you legal advice.
NOTICE NO. 4
Notice Mandated By Section 342(b)(2) Of The Bankruptcy Code
FRAUD & CONCEALMENT PROHIBITED
If you decide to file bankruptcy, it is important that you understand the following:
1. Some or all of the information you provide in connection with your bankruptcy will be filed with the bankruptcy court on forms or
documents that you will be required to sign and declare as true under penalty of perjury.
2. A person who knowingly and fraudulently conceals assets or makes a false oath or statement under penalty of perjury in
connection with a bankruptcy case shall be subject to fine, imprisonment, or both.
3. All information you provide in connection with your bankruptcy case is subject to examination by the Attorney General.
ACKNOWLEDGMENT OF RECEIPT
By using the Site and/or otherwise accepting this Agreement, you acknowledge that you have received a copy of or been provided
with access to all of the following notices:
1. Notice Mandated By Section 342(b)(1) and 527(a)(1) Of The Bankruptcy Code
2. Notice Mandated By Section 527(a)(2) Of The Bankruptcy Code
3. Notice Mandated By Section 527(b) Of The Bankruptcy Code
Notice Mandated By Section 527(b) Of The Bankruptcy Code
IMPORTANT INFORMATION ABOUT BANKRUPTCY ASSISTANCE SERVICES
If you decide to seek bankruptcy relief, you can represent yourself, [or] you can hire an attorney to represent you, or you can get
help in some localities from a bankruptcy petition preparer who is not an attorney. THE LAW REQUIRES AN ATTORNEY OR
BANKRUPTCY PETITION PREPARER TO GIVE YOU A WRITTEN CONTRACT SPECIFYING WHAT THE ATTORNEY OR
BANKRUPTCY PETITION PREPARER WILL DO FOR YOU AND HOW MUCH IT WILL COST. Ask to see the contract before you
hire anyone.
The following information helps you understand what must be done in a routine bankruptcy case to help you evaluate how
much service you need. Although bankruptcy can be complex, many cases are routine.
Before filing a bankruptcy case, either you or your attorney should analyze your eligibility for different forms of debt relief available
under the Bankruptcy Code and which form of relief is most likely to be beneficial for you. Be sure you understand the relief you
can obtain and its limitations. To file a bankruptcy case, documents called a Petition, Schedules and Statement of Financial
Affairs, as well as in some cases a Statement of Intention need to be prepared correctly and filed with the bankruptcy court. You
will have to pay a filing fee to the bankruptcy court. Once your case starts, you will have to attend the required first meeting of
creditors where you may be questioned by a court official called a trustee, and by creditors.
If you choose to file a chapter 7 case, you may be asked by a creditor to reaffirm a debt. You may want help deciding whether to
do so. A creditor is not permitted to coerce you into reaffirming your debts. It may not be in your best interest to reaffirm a debt.
If you choose to file a chapter 13 case in which you repay your creditors what you can afford over 3 to 5 years, you may also want
help with preparing your chapter 13 plan and with the confirmation hearing on your plan which, if held, will be before a bankruptcy
judge.
If you select another type of relief under the Bankruptcy Code other than chapter 7 or chapter 13, you will want to find out what
should be done from someone familiar with that type of relief. However, please be advised that in most cases, you will only be
concerned with chapter 7 and chapter 13.
Your bankruptcy case may also involve litigation. You are generally permitted to represent yourself in litigation in bankruptcy
court, but only attorneys, not bankruptcy petition preparers, can give you legal advice.
NOTICE NO. 4
Notice Mandated By Section 342(b)(2) Of The Bankruptcy Code
FRAUD & CONCEALMENT PROHIBITED
If you decide to file bankruptcy, it is important that you understand the following:
1. Some or all of the information you provide in connection with your bankruptcy will be filed with the bankruptcy court on forms or
documents that you will be required to sign and declare as true under penalty of perjury.
2. A person who knowingly and fraudulently conceals assets or makes a false oath or statement under penalty of perjury in
connection with a bankruptcy case shall be subject to fine, imprisonment, or both.
3. All information you provide in connection with your bankruptcy case is subject to examination by the Attorney General.
ACKNOWLEDGMENT OF RECEIPT
By using the Site and/or otherwise accepting this Agreement, you acknowledge that you have received a copy of or been provided
with access to all of the following notices:
1. Notice Mandated By Section 342(b)(1) and 527(a)(1) Of The Bankruptcy Code
2. Notice Mandated By Section 527(a)(2) Of The Bankruptcy Code
3. Notice Mandated By Section 527(b) Of The Bankruptcy Code
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And secondly, while we're never to provide you "legal advice," we're fully authorized under law [ see Section 527(c) of the
Bankruptcy Code], to properly answer any questions you (an assisted debtor-client) may have, and/or to inform you, on certain
bankruptcy matters in such a “reasonably sufficient” manner as to enable you know what information, exactly, you’re to provide
us in order to enable us properly and accurately prepare your bankruptcy documents for you. Those matters on which we can
properly inform and guide you (aside from the full preparation of your bankruptcy papers, of course), include specifically the
following matters, according to the said Section 527(c) of the Bankruptcy Code:
"(1) how to value assets at replacement value, determine current monthly income or the amounts specified in section
707 (b)(2). And, in a chapter 13 case, how to determine disposable income in accordance with section 707 (b)(2) and
related calculations;
( 2) how to complete the list of creditors, including how to determine what amount is owed and what address for the
creditor should be shown; and
(3) how to determine what property is exempt and how to value exempt property at replacement value as defined in
section 506, among other things.
Bankruptcy Code], to properly answer any questions you (an assisted debtor-client) may have, and/or to inform you, on certain
bankruptcy matters in such a “reasonably sufficient” manner as to enable you know what information, exactly, you’re to provide
us in order to enable us properly and accurately prepare your bankruptcy documents for you. Those matters on which we can
properly inform and guide you (aside from the full preparation of your bankruptcy papers, of course), include specifically the
following matters, according to the said Section 527(c) of the Bankruptcy Code:
"(1) how to value assets at replacement value, determine current monthly income or the amounts specified in section
707 (b)(2). And, in a chapter 13 case, how to determine disposable income in accordance with section 707 (b)(2) and
related calculations;
( 2) how to complete the list of creditors, including how to determine what amount is owed and what address for the
creditor should be shown; and
(3) how to determine what property is exempt and how to value exempt property at replacement value as defined in
section 506, among other things.
THE DISCLOSURES REQUIRED UNDER SECTION 527 AND 342 OF
THE BANKRUPTCY ABUSE PREVENTION AND CONSUMER
PROTECTION ACT OF 2005 (BAPCPA).
NOTICE NO. 1
Notice Mandated By Section 342(b)(1) and 527(a)(1) Of The Bankruptcy Code
PURPOSES, BENEFITS AND COSTS OF BANKRUPTCY
THE BANKRUPTCY ABUSE PREVENTION AND CONSUMER
PROTECTION ACT OF 2005 (BAPCPA).
NOTICE NO. 1
Notice Mandated By Section 342(b)(1) and 527(a)(1) Of The Bankruptcy Code
PURPOSES, BENEFITS AND COSTS OF BANKRUPTCY
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as its content, belong to Afford-Bankruptcy.com, and we reserve the absolute rights to prosecute any and all
person(s) or entities, to the fullest extent of the law, who infringe upon any rights hereto in any way or manner
whatsoever. And NOTE that when you read or use this site, you are doing so solely and only under the
understandings and the agreement which you’ve duly entered into in this TERMS OF USE.