MYATLLAW BANKRUPTCY GUIDE. A Comprehensive Bankruptcy and Attorney-Client Correspondence Manual for Existing and Potential Bankruptcy Clients

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1 MYATLLAW BANKRUPTCY GUIDE A Comprehensive Bankruptcy and Attorney-Client Correspondence Manual for Existing and Potential Bankruptcy Clients

2 TABLE OF CONTENTS GREETINGS: Welcome and thank you for taking the time to view this guide UNDERSTANDING BANKRUPTCY: What is Bankruptcy? CHAPTER 7 COMMONLY REFERRED TO AS: STRAIGHT BANKRUPTCY TYPES OF BANKRUPTCY: CHAPTER 13 AKA REORGANIZATION BANKRUPTCY MOVING ONWARD: Your Consultation THE BEGINNING: Filing Your Petition AS WE PROCEED: The Petition for Bankruptcy CREDITORS REPLY

3 MOVING OWNWARD: The Appointeed Trustee THE CREDITOR S 341 MEETING FOLLOWING THE 341 MEETING THANKS: MyATLlaw Firm proudly services all clients by providing quality customer-service and guidance with compassion

4 GREETINGS Welcome and thank you for taking the time to view this guide 5

5 GREETINGS Welcome and thank you for taking the time to view this guide. It is our intention to provide you with many of the answers you need. Again, thanks for your interest in the services provided by myatllaw Firm. We strive diligently to provide high quality services to our clients, as well as providing clarity on what our services entail to future clients. We make sure to present a wide-range of options as they apply to your individual financial circumstances. We understand the stress and turmoil associated with financial stress, and therefore make every attempt to make the possibility of a new perspective on life, a reality for all clients. myatllaw Firm has a wide category of solutions available to accommodate the financial needs of consumers: personal bankruptcy, debt relief, debt settlement, and mortgage modification negotiation services. This guide has been created to provide professional and compassionate support to our existing and future bankruptcy clients. We make every attempt to answer common, everyday questions in a manner that is clear and concise to all who read it. In other words, you don t need a law degree or background in law to understand the content of this guide. We aim to dismiss the rumors concerning bankruptcy, and arm current and future clients with knowledge of the bankruptcy system. It is our overall objective to help you understand the role our firm assumes in assisting current and future clients through the process of their bankruptcy case from start to finish. We hope that this Guide answers many of your questions and removes any fears, doubts or concerns you may have regarding the bankruptcy process. We moreover hope that you allow us to help you, as we are and have many others, in moving beyond this financial disaster in your life to the new beginning that you deserve. MyAtLaw Firm 6

6 UNDERSTANDING BANKRUPTCY What is Bankruptcy? The term sounds much more intimidating than it actually is and can be explained quite simply 9

7 UNDERSTANDING BANKRUPTCY What is Bankruptcy? The term sounds much more intimidating than it actually is and can be explained quite simply. Bankruptcy is a process in which a corporation or an individual can relieve itself of specified obligations of debt to creditors. It is a Federal injunction, an apparatus of Federal law, that is supercilious to state-law branded collection lawsuits, commercial contracts, automobile and mortgage loan payments, and other categories classified under debt agreements. It is hard to imagine that one easily defined legal apparatus could bring emotional distress and embarrassment, but in many situations, that s exactly what occurs. Many are aware that bankruptcy shows up in some of the most prestigious places, such as Deuteronomy, the United States Constitution and the Magna Carta. But even after making appearances in such renowned places, few will admit that bankruptcy is an avenue they ve considered or utilized during times of financial turmoil in their own life. Regardless of the endless embarrassment associated with the term, it holds a superior position in our sweltering economy. Why is bankruptcy such a power player in the solution bracket of financial turmoil? One word, beneficial. Bankruptcy serves as a great benefit to the person declaring the status to relieve himself from the burden of escalating debt, and it is beneficial for society. It restores the condition of our economy to one that is composed of healthy individuals that economically replenish it to a state of thriving existence. This replenishment cycle is due in part to the purchase of products and services instead of via the repayment of debt into huge financial sectors. Therefore, the primary purpose of Bankruptcy as an apparatus of the law, is to assist the economy of America in functioning as it should. But not to provide a way out to people who are incapable or unwilling to assume financial responsibility in life. For those individuals who have or are experiencing a financial hindrance in life, preventing them from fulfilling their obligations to the personal debt they have accrued, filing personal bankruptcy could possible serve as the most beneficial option for getting back to a stable and secure financial positon in their life. myatllaw Firm provides Chapter 7 and Chapter 13 Bankruptcy Services. 10

8 UNDERSTANDING CATEGORIES CHAPTER 7 COMMONLY REFERRED TO AS: STRAIGHT BANKRUPTCY Chapter 7 (Liquidation) or Straight bankruptcies completely preempt you from your financial obligations, which provides a settlement for all your outstanding financial debts and presents you with an opportunity to help you start over with a clean financial slate. This category of bankruptcy is the deemed as the most affordable option a debtor could pursue. However, limitations on eligibility do apply. Please know that our courts commonly grant bankruptcy relief to the typical "honest but unfortunate" debtor. However, the Trustee is free to file actions in the case against you, if he has reason to believe that you have funneled assets to other parties or have paid friendly vendors in preference to others. This is called an avoidance action, where the Trustee asks the court to undo those transfers. We can help you dispute the Trustee's claim. For an individual to be considered eligible to file Chapter 7, household earnings must be less than that of the state recognized median income for a household of that size. The process for Chapter 7 bankruptcy is approximately 4 months and credit counseling courses taken via phone or internet are a requirement. There is also a required appearance at a 341 meeting of the creditors, this is an administrative hearing. An official Chapter 7 filing halts collection lawsuits, harassing letters and phone-calls, garnishments and foreclosures. 11

9 TYPES OF BANKRUPTCY CHAPTER 13 AKA REORGANIZATION BANKRUPTCY Chapter 13 is not the liquidation of debts like Chapter 7 bankruptcy. This category references reorganizations of personal affairs. 13

10 TYPES OF BANKRUPTCY CHAPTER 13 AKA REORGANIZATION BANKRUPTCY Chapter 13 is not the liquidation of debts like Chapter 7 bankruptcy. This category references reorganizations of personal affairs. Chapter 13 bankruptcy allows the petitioner to submit payments to creditors via a payment plan set forth and approved by the court for three to five years. The predetermined amount is per your net income after all your monthly recurring expenses. There is no minimum amount required for Chapter 13, but the amount must be enough to settle the required debts within the appointed timeframe allowed by the courts. Whatever remains afterward, is paid to unsecured creditors. Any amount left unpaid to unsecured creditors once the plan is completed, is discharged. Chapter 13 is the ideal way to prevent foreclosure, decrease the balance owed on a car or other types of secured loans, and to remove a second lien from a mortgage. These channels are not an option in Chapter 7 filing. Chapter 13 is a suggested option for people who have an income that is too great to qualify for Chapter 7. There are limitations on Chapter 13, but those who have too high of a debt amount may not be eligible for Chapter 13. Previous bankruptcies may have an impact on eligibility for Chapter 13 and Chapter 7 filing. 14

11 MOVING ONWARD Your Consultation The first step to filing a petition for your bankruptcy case begins with an in-office consultation 17

12 MOVING ONWARD Your Consultation The first step to filing a petition for your bankruptcy case begins with an in-office consultation. This is likely the first time we will meet. During the meeting, we take the time to review the circumstances surrounding your financial situation and discuss your objectives for your case. We also reveal if we think that bankruptcy is the right option to help you achieve your goals. If so, we move on to discuss the process, what you should expect to happen next, and which category of bankruptcy will benefit you most. We make certain you understand what is required of you from this point on, as we prepare to move forward in filing the petition. The fee structure for your bankruptcy is also discussed during your initial consultation. Our fee structure varies and is determined according to the details and hardships of your case, as well as if it will be filed as a Chapter 13 or Chapter 7. We can only offer a structured fee quote after a consultation, and therefore don t provide a flat fee quote via phone or before the consult. There is no initial consultation fee imposed by myatllaw Firm. This is the much-needed opportunity to meet and discuss the details of your financial circumstances and weigh your options, which will allow you to make a conscience decision about filing and to determine if you would like to utilize our attorneys to represent you in the Bankruptcy filing. Aside from all this, just arrive with a general idea of your debts, income and personal assets. We will do the rest and determine the best route to take to help determine the best available option for your financial circumstances. 18

13 THE BEGINNING Filing Your Petition The initial process of filing your bankruptcy case involves two major steps: (1) a large amount of detailed information from you and (2) collection of verifiable documentation to support the information 21

14 THE BEGINNING Filing Your Petition The initial process of filing your bankruptcy case involves two major steps: (1) a large amount of detailed information from you and (2) collection of verifiable documentation to support the information. The most essential item we request of you is for you to complete the Bankruptcy Client Questionnaire form we give you. This needs to be completed in its entirety and honestly. This will appear in the form of an extensive document and for most, proves to be the most tedious aspect of the entire filing process. This form is utilized to collect details of all your personal liabilities and assets, and your monthly expenses and income. There will be a requirement for additional documentation, of which will vary based on the case itself. Some of the requested documentation includes: 1. Lease Agreement Copies 2. Automobile Titles 3. Paycheck Stubs or Income Verification (Dating back at least 6-months) 4. Last Filed Tax Returns (2-4 at least) 5. Credit Report from the 3 Major Credit Bureaus 6. Credit Counseling Course Certificate of Completion 7. Bank or Financial Statements (90 Days) Upon completion of the questionnaire and collection of all required and requested documentation, you will return to the office for a follow-up meeting. It is at this time that we review the documentation to ensure that everything is in order, and as it should be for a successful bankruptcy filing. This part of the process can and may seem overwhelming, but we are available to assist you as much as possible at this point. We will answer in questions regarding the required documents and help to clarify any discrepancies or uncertainties you may have regarding information on the questionnaire. Remember, this is the part of the process that sets the wheels in motion for you to return to the positive financial status that you once knew. There is no room for error. However, the schedules of assets and liabilities can be amended after filing the petition, and those amendments are commonly accepted by the court. 22

15 AS WE PROCEED The Petition for Bankruptcy Once you ve submitted all the necessary documents and we have verified that everything is in order, it only takes a short time for us to prepare your petition for bankruptcy for you to review 25

16 AS WE PROCEED The Petition for Bankruptcy Once you ve submitted all the necessary documents and we have verified that everything is in order, it only takes a short time for us to prepare your petition for bankruptcy for you to review. It usually takes only a couple of days after you ve submitted the documentation to us for the process to move forward. Once we draft a petition, you will return to the office a third time to review the petition from beginning to end. We go over the details of each section with you, and have you to confirm that everything you review is precise, complete, and honestly reveals all your income, liabilities, expenses, and assets. Once all is confirmed, you will add your signature to the petition, and we proceed to file the motion for bankruptcy. Filing of bankruptcy is an electronic process and for Chapter 13 bankruptcies, your case number is given immediately, and other information at a later time. Regarding Chapter 7 bankruptcies, your case number and 341 Meeting date, assigned Trustee are all granted immediately. CREDITORS REPLY Upon the filing of your petition, contact from creditors with attempts to collect debts is no longer permitted and forbidden by the automatic stay, a provision of the Bankruptcy Code. Take into consideration that it will take a little time for some of the creditors to be notified by the court of your bankruptcy filing. If by chance you are contacted by creditors 48 hours after the petition was filed, provide them with your bankruptcy case number, date of the filing, and our contact information. This will usually stop them from contacting you again. Later in the process after your discharge has been granted, creditors are not permitted to call you or send you collection letters for debts which were discharged in the bankruptcy. Companies that do this, are subject to violations of the Fair Debt Collection Practices Act, and liable for damages. We can help you file a separate lawsuit against those companies in federal court, if they insist in collecting debt for which you were relieved in bankruptcy In the case that they do call after you ve given them this information, let us know immediately. We will quickly pursue aggressive action against them in the U.S. Bankruptcy Court. 26

17 MOVING OWNWARD THE APPOINTED TRUSTEE The filing of a bankruptcy petition equates to a legal estate that is established based on all your possessions 29

18 MOVING OWNWARD The Appointed Trustee The filing of a bankruptcy petition equates to a legal estate that is established based on all your possessions, all that you are owed, and your debts. Similar to a probate estate that is established when someone passes away and didn t leave a legal will behind. A Trustee administers this estate. In one regard, the Trustee is an administrator, but in another regard, the Trustee isn t an impartial participant in the cycle of bankruptcy. The role of the Trustee varies, based upon the category filed, Chapter 7 or Chapter 13. In Chapter 7, the role of the Trustee is to dissolve all assets in the estate of the petitioner to benefit the creditors whose debts are being discharged. As bankruptcy attorneys, it is our responsibility to file exemptions, to shield your assets from the liquidation process of the Trustee. Usually, we are able to protect all or at least, most of the property. However, each case is different and there is no guarantee of outcome in any cases represented. In Chapter 13, the Trustee represents unsecured creditors who receive the funds via the plan at the bottom of the priority cycle. Any plan that fails to the treat the unsecured creditors as required by the Bankruptcy Code will be challenged or objected by the Trustee. Therefore, the Trustee serves as our opposition during Bankruptcy proceedings, alongside the creditors. There is a great deal of skill and knowledge required to properly interact with Trustees. This, among other reasons is why it is not recommended that one represents himself when filing a petition for bankruptcy. Attorney representation is strongly recommended. Bankruptcy attorneys have a responsibility and commitment to the petitioner. Their objective is to pursue the best course of action to help relieve the client of their financial burden. THE CREDITOR S 341 MEETING The 341 Meeting for Creditors of Chapter 7 or Chapter 13 cases, occurs about days after the petition has been filed. In Chapter 7 cases, it is usually required that you attend this hearing. If presents an opportunity for creditors to question you under oath and have you make statements for the record. Typically, only the attorneys for credit unions usually show to this hearing, and the process is a speedy interrogation that is performed under oath. Some questions will apply to your case, while others will not. In Chapter 13 cases, the 341 is present and more active and the proceedings can last up to 30 minutes. The Trustee assigned to your case determines a great deal about the length and requirements of the meeting. In some cases, you may be required to participate in an orientation before the meeting. The Chapter 13 Trustee will have established questions 30

19 based on issues of concerns they have about your petition or the Plan. In both cases, the petitioner is questions, and the representing attorneys do not answer for their clients, unless special circumstances have been made known and the okay to do so was given before the meeting started. There are some cases where we will present questions also. Many law firms hire appearance lawyers for client representation at the 341 meetings. This means that you may arrive to your 341 hearing and have an attorney that you have never seen or talked with in the past. myatllaw Firm does not contract appearance lawyers to represent you during the meetings. We work with you from the start to finish of your filing process. FOLLOWING THE 341 MEETING The only step that remains following the 341 Meeting of a Chapter 7 Bankruptcy is the required 60-day waiting period enforced by the Bankruptcy Code. This is similar to a holding-process that permits creditors, as well as the Trustee, time to review the findings and determine if they wish to challenge the discharge, object the eligibility of certain debts to be discharged, or to present other similar objections. The occurrences that take place following this meeting vary from case to case and there is never a guarantee of the legal outcome. Typically, there is no activity that takes place during this waiting period and all parties simply await the discharge to be issued by the court. Chapter 13 cases require one additional hearing following the 341 Meeting that serves as confirmation of the plan. The petitioner is required to attend this hearing. This is the hearing that confirms your plan and will more than likely be confirmed by the Trustee, which means the bankruptcy proceedings can move forward. Usually, there is nothing required of you, other than wait for the approval, or denial of the terms agreed upon with the creditors or Trustees that were put in place to provide solutions to any objections they may have presented. If all is approved, confirmation of your Plan goes forth, and nothing further is required of you other than to make your payments per the Plan for the duration of time they were assigned. 31

20 THANKS! MYATLLAW Firm proudly services all clients by providing quality customer-service and guidance with compassion. 32

21 THANKS! MYATLLAW Firm proudly services all clients by providing quality customerservice and guidance with compassion. We are grateful for all clients and aware that a large percentage of them is by way of referral. We strive to continue the trend by always putting the client first. We say thanks to you for taking the time to study this Guide, and we welcome you to contact us with any questions you may have. We look forward to working by your side. 33

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