Chapter 13 from Start to Successful Completion
We now demonstrate the steps that are involved in preparing, processing, and completing a successful Chapter 13 case. The object is to get a discharge and wipe out as many debts as we can. If certain bills have to be paid, we can get you up to five years to pay them, without interest in many cases.
Step One – Filing the Petition, Notifying the Creditors, and Protecting You From Those Creditors
A Chapter 13 bankruptcy is started by filing a document called a petition. The petition and additional pages attached are usually about 70 pages long. In order to properly prepare the petition we meet with you for approximately one to two hours in order to complete the necessary documentation.
The case officially begins when the Chapter 13 petition is filed with the Bankruptcy Court and the $310 filing fee is paid to the Court. Bankruptcy petitions are electronically filed by our office. The Court immediately assigns a case number to your case. At that point your case is officially started, and you therefore obtain complete protection from your creditors.
Our office can immediately notify any creditors that need to be notified of the bankruptcy filing by calling them and mailing, faxing or hand delivering a filed copy of your petition to that creditor. If a creditor takes action against you after being informed that you have started your bankruptcy, that creditor can be sanctioned by the Bankruptcy Court.
The Bankruptcy Court notifies all of the creditors listed in your petition that your bankruptcy has been filed. You will be getting copies of the same notices that your creditors get. Therefore, when you get your notice in the mail you know that your creditors should have already been notified by the Bankruptcy Court. If someone needs to be immediately notified of the bankruptcy filing before they get the official notice from the Court we can notify them as stated above.
Here are some examples of the types of creditors that can be notified of your bankruptcy filing:
- We can notify utility companies so your utilities are not shut off. If your utilities have been shut off before the bankruptcy filing, the utility companies will be required to turn your service back on.
- We can notify mortgage companies so that foreclosure proceedings or sheriff sales are immediately stopped.
- We can notify car finance companies so that there will be no vehicle repossessions. If your vehicle has been repossessed, it would normally have to be returned to you once we submit proof of full coverage automobile insurance.
- If your landlord is trying to evict you we can stop the eviction.
- If the IRS is withholding your refund or taking other action against you, that activity usually has to stop upon filing of bankruptcy.
- If anyone is trying to attach your wages, they will have to stop. If anyone already has a wage attachment against you, that will have to stop. If any money is taken out of your wages after your bankruptcy has been started, it will have to be returned to you. Sometimes we can get your money back that has been taken from your salary within 90 days before your bankruptcy filing.
- If anyone has frozen your bank account, that will have to stop, and any money that has not been turned over to the creditor that froze your account will have to be returned to you.
- If you are trying to get your driver's license and you have surcharges, once the MVC is notified of your bankruptcy, they have to stop all surcharge collection activity. You can meet with the MVC representative in West Deptford to make arrangements to get your driving privilege reinstated. Once we have a copy of your complete driver's abstract from the MVC, we can work towards getting your driver's license back.
- If anyone is suing you for just about anything, that lawsuit will have to stop unless the Bankruptcy Court gives the creditor or any other party that is suing you permission to continue with the case against you.
Step Two – Your Case Number, Notice of Bankruptcy Meeting
The Court immediately assigns a case number to your case, and we can provide you with your case number as soon as the case has been filed.
Soon after your case has been filed, you and your creditors will receive a document from the Bankruptcy Court called the Notice of Chapter 13 Case. This Notice contains your case number, and it is the official notice to you and your creditors that the court has filed your case.
Please make sure that you review this document carefully because it gives you information as to when and where you need to appear for your bankruptcy meeting. The meeting is usually scheduled to take place about four weeks after your case has been filed, and it will be held in either Cherry Hill or Northfield, depending on where you live.
You will also get a series of letters from the Bankruptcy Court and from Isabel Balboa, the Chapter 13 trustee. Some of these letters may be confusing because they are general letters that are sent to everyone who files a Chapter 13, and a lot of that information might not even apply to your case.
Other letters are specific to your case and will give you exact information such as the date and time of your meeting with the trustee, and the amount of your monthly trustee payment. You can of course call us any time that you have any questions. You can also contact Ms. Balboa's office at 856-663-5002, extension 123, 137, or 125.
Step Three – Your Bankruptcy Meeting With Ms. Balboa
If you live in Cumberland, Gloucester, Salem, or Camden County, your meeting will take place at Isabel Balboa's meeting room, 535 Route 70 East, first floor, in Cherry Hill. If you live in Cape May or Atlantic County, your meeting will take place in an office building at 1423 Tilton Road, Northfield.
Many people are a little afraid of the meeting. The truth is that it is very straightforward and painless, and usually takes about 15 minutes or less. Please check in at the desk when you arrive.
A lot of meetings are scheduled at the same time, so please expect that you might be waiting around for a while before your name is called.
You actually already know almost all of the answers to all of the questions you will be asked because they are very straightforward. No one is going to try to trick you. The following topics will most likely be covered by the questions you are asked:
- Where do you work? If you don't work, what is your source of income?
- Have you filed all of your tax returns? There is a law that your bankruptcy will be dismissed if you have not filed all of your required tax returns.
- You will be asked whether you owe any taxes to the IRS or to the State of New Jersey. If you owe back taxes, you can pay them through your bankruptcy.
- If you own a house, state when the house was purchased, what was the purchase price, and what is it worth now.
- Who lives with you? If you share expenses with another individual, either a spouse, friend, roommate, or anyone else, you will need to disclose the income of that other person and provide proof of income for that person, even though he/she is not a part of the bankruptcy. This is necessary because a bankruptcy rule states that if you share income and/or expenses with someone you live with, full disclosure of all such information must be made to the court.
- Do you receive child support for any children you have? If you do, you will need to provide documentation to show how much child support you receive. The trustee will also ask if you pay child support or if you are required to pay child support. We must list the names and addresses of all people to whom you are required to pay child support.
- Does anyone help you pay your bills? If someone contributes to your income or helps with your expenses, Ms. Balboa will require a signed statement from that person to verify the amount of financial assistance that they give you on a regular basis.
- Have you reviewed your bankruptcy papers before signing them? Did you meet with an attorney before signing the papers? Is all the information on the bankruptcy petition correct, or do you want to make any additions, corrections, or changes? If you need to add new creditors that were not previously listed, there is an additional attorney fee and court costs that need to be paid.
- You will need to show Ms. Balboa a recent pay stub or other proof of income. When you bring a pay stub, do not bring something with overtime unless you normally work overtime. Bring something that indicates your normal weekly or biweekly earnings. If you get social security, welfare, unemployment, food stamps, child support, disability or any other type of income, you will need to provide proof to Ms. Balboa. You can bring us a copy of your next check since that is a good way to prove what you receive. If Ms. Balboa needs any supplemental information or documentation, she will give us additional time to provide it.
- What caused you to file for bankruptcy?
- Have you inherited any property, or do you have any potential to inherit property in the near future? This question is asked because any property that you are expecting to inherit as a result of someone who has already died, or any inheritance you are entitled to receive in the six months after you filed your bankruptcy must be reported. This inheritance can be considered as an asset that has to be disclosed by you.
- Do you have any safe deposit boxes? If you have any safe deposit boxes, then the Trustee will probably ask you what is in your safe deposit box. If you have a safe deposit box and have anything valuable in it, let us know because it needs to be disclosed.
- If you have filed for Chapter 13 before, you will be asked how things are different now. In other words, if your first bankruptcy did not succeed, you will need to show some sort of change in your circumstances to indicate what went wrong the first time, and why you believe this case will succeed. You can't just keep filing one bankruptcy after another because Ms. Balboa will think you might be trying to abuse the system. If you have filed a previous Chapter 13, you need to demonstrate why this case is going to work when the others did not. If this situation applies to you, we will review with you in detail to make sure you are fully prepared for answers to questions concerning any previous bankruptcies that you have filed. Please make sure to tell us about any previous bankruptcies that you have filed.
- Ms. Balboa has three other attorneys that work with her and also conduct the meetings. Their names are Jane McDonald, Ray Shockley, and Jennifer Gorchow. It really doesn't matter who conducts the meeting since we will be there with you, and all of the attorneys are very nice. They are not there to give you a hard time. Instead, the purposes of the meeting are to make sure that all of the paperwork has been done properly, to find out if there have been any changes since the bankruptcy was filed, to make sure you understand the Chapter 13 process and your responsibilities, and to make sure that you are doing what you are supposed to do, including making all of your trustee payments on time. They will check the records to make certain that you are up to date in your trustee payments. If you are behind in your payments, they will normally inform you that your case will be in jeopardy of being dismissed unless you bring your payments current. If your case is dismissed, all creditors have a right to pursue you again, and you lose the protection of the Bankruptcy Court. So it is obviously very important that you make your trustee payments on time every month. If for some reason you can't make the full payment, it is better to send Ms. Balboa a partial payment rather than no payment at all.
- You will probably be asked whether you own a time share. Please make sure that you let us know whether or not you own a time share or are making payments on a time share. If you are making car payments directly to a finance company or to a buy here pay here dealer, you will be asked when your last car payment is due. The reason is that Ms. Balboa figures once your last car payment has been made, you will have extra money. She wants to know what you intend to do with the money that you will no longer be using to pay off your car. If this situation applies to you, please make sure to let us know so that we may prepare you for the questions you will be asked.
- If you are involved in your own business, the case becomes more complicated. You must fill out a detailed business questionnaire statement, you must supply detailed financial records including a profit and loss statement, and you must prove you have adequate insurance. Please make sure to let us know if you are running your own business, either full time or part time, so we can fully prepare you for the type of questions you will be asked.
- Keep in mind that you are required to make a payment to Ms. Balboa on the first of every month starting with the first day of the month after your bankruptcy petition was filed. For example, if your case was filed on June 15, your trustee payment must be made on July 1. You have a right to be a little late in your payments, but the best policy is to make sure that the payment is sent in on the first of the month. Please make sure to send in the payment by money order, and write your name and your case number on the money order. The payment should be sent by regular mail to:Isabel Balboa, Trustee PO Box 1978 Memphis, TN 38101-1978.
Here Is a Great Way to Make Sure That You Have a Successful Chapter 13 Case
In many cases, the best thing to do is to let your employer send in your trustee payment for you. This is called a wage order. The Bankruptcy Court can order that your employer take a little bit out of each paycheck and forward that money to Ms. Balboa.
This makes it a lot easier for you and assures you that payments will be made on a timely basis, so that your case will be successful . If this is something you are interested in, ask us and we will tell you how to do it. It's really a very simple procedure, and we normally recommend it for most clients, since it is a great way to make sure your payments are always made.
If something unexpected happens, and you cannot make a payment on time, please notify our office. There is a procedure where we can request a temporary suspension of payments as long as there is a legitimate reason.
What if You Have Filed a Previous Chapter 13 That Was Not Successful?
If you have filed for bankruptcy once before or more than once, you will be asked certain special questions concerning your previous bankruptcies. The law requires that there be some sort of change of circumstances to permit you to file another bankruptcy.
You cannot simply keep filing Chapter 13, have your case dismissed, and then file another Chapter 13 simply for the purpose of stopping the creditors from harassing you. The Court might consider something like this as an abuse of the bankruptcy system. You therefore need to demonstrate some sort of change of circumstances. In other words, if your previous bankruptcy failed, what is different now that is going to make this bankruptcy succeed?
We will fully prepare you in this area if it applies to you. Make sure to tell us about all previous bankruptcies so we can fully prepare you for questions concerning previous bankruptcies. If there is going to be any change in your employment situation, income, expenses, or any other significant changes, you are required to notify us and to notify Ms. Balboa. In fact, before you start your meeting, you sign a paper indicating that you will notify Ms. Balboa of any changes in your circumstances.
If You Are Buying or Selling a House, or if You Buy or Sell a Car While You Are in Bankruptcy, You Must Let Us Know Right Away. These Transactions Often Require Court Approval.
Normally, you cannot take on additional debt or sell property without the previous consent of Ms. Balboa or the Bankruptcy Court. Obtaining approval is usually a relatively simple procedure. If you intend to make a major purchase, incur major debt, or sell something of significant value, like a car, a house, or real estate, you must notify Ms. Balboa and the Bankruptcy Court, so please inform us of any such circumstances if they occur in the future.
REMINDER: When you go to your meeting, you must bring your social security card and a government approved photo ID. If you do not bring these items, you will have to come back.
What to Do After Your Bankruptcy Meeting
After you have had your meeting with Ms. Balboa, you are required to do the following:
- PAY MS. BALBOA EVERY MONTH. Continue to make regular monthly payments to Ms. Balboa. If you are behind at the time of the meeting, you need to catch up if you want your case to continue. The only exception is if we have obtained a court order to suspend trustee payments because of some unexpected event that has prevented you from being able to make regular payments.
- TELL US WHEN THINGS CHANGE. You must notify our office of any significant change in your financial circumstances or other circumstances that would somehow affect your case.
- IF YOU OWN A HOME, CONTINUE TO PAY YOUR MORTGAGE.If you have a mortgage, and you want to keep your house, you must continue making regular mortgage payments. If something unexpected happens that prevents you from making any mortgage payment on time, notify our office. There are procedures where the Court can temporarily suspend the requirement to pay your mortgage on time if you can show good cause.
After your meeting, the next step is the confirmation hearing which takes place at the Bankruptcy Court in Camden. Normally you will not have to attend the confirmation hearing unless there is a very serious objection to your case by the trustee or by one of the creditors. Such a situation is unusual so do not plan to be present at the confirmation hearing unless we advise you to be there.