What Happens After Your Chapter 7 Bankruptcy Petition Is Filed?

You are finally ready to file your bankruptcy petition.  You have put in all of the hard work.  Your attorney has all of the information necessary to put your case together.  Your credit counseling course is completed.  You have met with your attorney and signed your Chapter 7 bankruptcy petition papers.  But what happens next?

Immediate Actions Taken After the Bankruptcy Petition is Filed.

Once your Chapter 7 bankruptcy case is filed with the Court the real fun begins.  The Bankruptcy Court sends out notice of your case filing to all of your creditors.  Once your creditors receive notice of your bankruptcy petition contact from creditors will stop.  Your court date (the § 341 Hearing or Meeting of Creditors) is scheduled approximately 6-8 weeks after your filing.  The Court automatically schedules this hearing.  You will receive a notice from the Bankruptcy Court stating the date, time and location of your bankruptcy hearing.

Attending the Meeting of Creditors

The § 341 Hearing or Meeting of Creditors is typically the only court hearing you have to attend.  The Court schedules 3-4 hearings every 30 minutes.  Therefore, the hearing does not last all day or all morning/afternoon.  If your hearing is set for 9:00 am, and you are the fourth case called, you should be done by 9:30 am.  This hearing is a time for the Trustee assigned to your case to ask you questions.  Their job is to verify the information you filed in your bankruptcy petition.  Their job is also to collect unprotected property, liquidate this property, and use the proceeds for the benefit of your creditors.  If any of your creditors want to attend the hearing they are more than welcome.  These hearings are public and anyone can attend.

Final Steps

You have to complete a second credit counseling course typically within 4 months after the filing of your bankruptcy petition.  You also have to wait for a deadline to pass.  This deadline is for your creditors to object to the dischargeability of their debt.  This means that the creditor argues the debt you owe them should not be wiped away.  2-3 more weeks will pass until you receive your Order of Discharge.  This is the order from the Court wiping out all of your debt.  About 2 more weeks pass and the case closes.

On average the entire process takes about 5-6 months from date of your case filing until the date the case closes.  Once you make the decision to file and get the process started, it will be over before you know it!