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Anatomy of a typical Chapter 7 bankruptcy

Suddenly finding yourself in a tough financial position can be very confusing and frightening. You may also feel like an outcast, while you watch your friends and family sail through life without worrying about money. On the bright side, you are not alone. You are one of many that have found themselves drowning in debt due to unexpected medical expenses or a company downsizing.

If you find yourself unable to properly manage your debt, it is important to remember that you have options to regain control of your life. An experienced bankruptcy attorney can help navigate a debt relief process that suits your needs. Read further to find out if Chapter 7 Bankruptcy is right for you.

Filing requirements

To begin the Chapter 7 process, you must first file a petition with the bankruptcy court. You will have to file documentation that includes a schedule of assets and liabilities, current income and expenses, a financial statement, and a schedule of executory contracts and active leases. You must also provide a copy of your most recently filed tax returns or transcripts.

As an individual debtor with mostly consumer debts, you will have to complete credit counseling and submit the certification of completion. You must also hand in evidence of your salary or wages, such as paystubs, that you received in the 60 days prior to filing.

Be prepared to submit a statement detailing your monthly income and expenditures as well as and changes you anticipate in the near future. If you have any federal or state qualified education or tuition accounts, you will also need to provide a record of interest that spans the life of the debts.

Creditor information

In addition to your income, expenses, assets and liabilities, you must also provide information about the individual debts. For example, to complete the Official Bankruptcy Forms, you must have a list of all creditors and the details concerning their claims.

Stopping the collection process

Once you file a petition under Chapter 7, an automatic stay can stop most collection activities. While the stay is in effect, creditors cannot start new lawsuits or continue ones that are already in process. The court will notify your creditors of the bankruptcy case so that they are aware of the automatic stay.

Joint meeting

Typically, between 20 and 40 days after you file the petition, the trustee assigned to your case will conduct a meeting with your creditors. You will have to attend this meeting as well. You will be place under oath and then questioned by the trustee and the creditors about your financial situation.


Some time after the meeting of creditors, the Bankruptcy Court is likely to give you a discharge of your unsecured debts. These are debts that are not secured by collateral. For instance, credit card bills and medical debts are usually discharged in bankruptcy. A car debt or mortgage debt has collateral, and therefore may not be discharged. Other debts that cannot be discharged are tax debts less than three years old, child support and spousal support debts and most student loans, among others.

Get the help you need

Filing for bankruptcy is a very complicated and is not something you should without the advice of someone experienced with the process. Even though it may feel like there is not a solution to your debt situation, it is important to remember that you have options.

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Law Office of Ginger C. Cord, PSC
155 E. Main Street
Suite 330
Lexington, KY 40507

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Phone: 859-963-2073
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