What Happens When You File a Bankruptcy Petition?

Posted on Sep 08, 2016 By Grant McNutt

B. Grant McNuttWhen you file your Bankruptcy petition, the Bankruptcy Court will send all your creditors a Notice of Bankruptcy Case (Form 309).  This Notice among other things will tell your creditors specifically which Chapter you have filed, be it a Chapter 7 or Chapter 13 Bankruptcy.  They usually receive this Notice within 7 to 10 days from your filing.  Don’t fret about the seemingly long time frame though, because the moment you file your Bankruptcy case, an automatic stay goes into effect.  The automatic stay stops your creditors immediately in their tracks and prohibits them from initiating or continuing any collection activities against you.  In other words, it stops your creditors in their tracks.

The automatic stay means that a creditor cannot call you, send you collection letters, file a lawsuit, or otherwise attempt to collect its debt from you.

Notice of Bankruptcy Case

Additionally, the Notice of Bankruptcy Case tells your creditors the time and location of your “Meeting of Creditors” also known as the 341 Hearing. As the Debtor in the case you are of course required to attend this mandatory meeting.  The ultimate reason for this meeting is to give the Bankruptcy Trustee and your creditors an opportunity to ask you questions under oath about your assets and financial affairs.

Again, do not fret, because despite its name, creditors rarely attend the meeting of creditors.  They will usually review your Bankruptcy petition that you file with the Court and this typically answers all their potential questions.  Unless a creditor believes that you are hiding assets or lying on your bankruptcy petition, they do not have much to gain from attending the 341 meeting.

If you are struggling to pay credit cards, medical bills or personal loans, not to mention your mortgage and vehicle loans, please call one of our conveniently located offices at Bond & Botes to set up a private consultation with one of our experienced attorneys.

We will analyze your situation and help you make the best decision possible to help you navigate your financial problems.