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A Complete Guide to the Bankruptcy Process in New York

Federal courts have exclusive jurisdiction over bankruptcy cases, and all bankruptcy cases must be filed in the federal Bankruptcy Court. For most individual debtors, it is their residence that determines the proper federal judicial district for filing. Other possible criteria to determine venue may include where the debtor’s principal place of business or principal assets are located. The debtor must have resided in the federal district for the greater portion of 180 days, generally meaning at least 91 days.

For individuals residing in Nassau County or Suffolk County, all bankruptcy cases are filed in the Central Islip Division of the Eastern District of New York. Individuals residing in Brooklyn or Queens file in the Brooklyn Division of the Eastern District of New York. Individuals residing in Manhattan and the Bronx, as well as Dutchess, Orange, Putnam, Rockland, Sullivan and Westchester Counties, file in the Southern District of New York, which consists of three divisions.

If you are considering filing for bankruptcy in New York, you should contact an experienced bankruptcy attorney. While the bankruptcy process may appear to be relatively straightforward, there are many traps and pitfalls for the unwary debtor. Going through the bankruptcy process alone can lead to the loss of valuable assets or result in the denial of a discharge. Andrew Doktofsky is an experienced bankruptcy attorney, with a thorough knowledge of bankruptcy law and procedure, as well as the local rules and practice in the Eastern District of New York and the Southern District of New York Bankruptcy Courts and will provide you with the expertise to guide you through a successful bankruptcy filing.

Steps Prior to the Bankruptcy Filing

Step One – Initial Call
Call my office. We will speak with you on the telephone to ascertain some basic information. We can then schedule an initial free consultation either at my office, by phone, or by video. We will tell you what documents to bring with you to the first official meeting.

Step Two – Office Consultation
During the initial meeting, we will discuss your situation in detail. We will review all of the information necessary to prepare for your bankruptcy filing, including your assets; your debts; and your household income. If necessary, an initial determination will be made to see if you pass the means test, which is what determines if you meet the income guidelines for Chapter 7. You will be given a monthly expense worksheet to take home and fill out. This is of critical importance, as it is necessary to demonstrate that you are unable to repay your debts in Chapter 7. Alternatively, in Chapter 13, the amount of income available after paying your monthly expenses is a critical component of the Chapter 13 process. I will also provide you with instructions on how to take the required credit counseling course.
Step Three – Preparation of Bankruptcy Petition
Using the information and documents that you provide, my office will prepare the bankruptcy petition, schedules, Statement of Financial Affairs, means test and other documents necessary to file your bankruptcy case. My office will also conduct a thorough check of all relevant court dockets and county clerk filings to ensure that all creditors and judgments are included in your bankruptcy filing. In addition, we will obtain a copy of your credit report to ensure that creditors appearing on the report are included. I will speak with you on the telephone to ensure that all information is accurate. Once everything is prepared, you will need to come into my office to review and sign the petition and accompanying schedules and statements that will be filed with the Bankruptcy Court.

In a Chapter 7 bankruptcy case, all legal fees and filing fees must be paid before the bankruptcy petition is filed. In a Chapter 13 proceeding, a portion of the legal fees can be paid through the Chapter 13 repayment plan.

Bankruptcy Timeline

Filing with the Bankruptcy Court

The petition is filed with the Bankruptcy Court electronically. It is the filing with the court that commences the bankruptcy case. The following items are included in a bankruptcy filing:

  • A schedule of assets, including all real property and personal property

  • A schedule of liabilities, including all secured, unsecured and priority debts

  • A schedule of contracts  that have not yet been completed, and unexpired leases.

  • A schedule of current  income and expenditures, including a statement of any anticipated increases or decreases in income or expenses after filing

  • Statement of Financial Affairs

  • Statement of Intention for Secured Debts (Chapter 7 only)

  • Statement of Current Monthly Income and Means Test Calculation

  • Chapter 13 Plan (Chapter 13 only)

In addition, a certificate of credit counseling, as well as all paystubs received in the 60 days prior to the bankruptcy filing are filed with the court (debtors who do not receive paystubs submit an affidavit stating the reason).

If for some reason the schedules were not filed with the petition, they must be filed within fourteen days after the bankruptcy petition is filed. If the required schedules are not filed within 45 days of the bankruptcy filing, the case may be automatically dismissed. A Chapter 13 plan must also be filed with the court within fourteen days after filing the petition. The debtor must start making payments on the Chapter 13 plan within 30 days after filing the bankruptcy case.

Notice to Creditors

Shortly after the bankruptcy case is filed, notice is sent by the clerk of the bankruptcy court to all creditors that were listed by the debtor. This notice includes:

  • The deadline for creditors to object to discharge;

  • The date set for the Meeting of Creditors;

  • A notice that an automatic stay is in effect and that creditors may not take collection action against the debtor

If a creditor wishes to object to the debtor’s discharge or the dischargeability of a particular debt, the creditor must file a complaint with the bankruptcy court by the deadline stated in the notice.

Meeting of Creditors

Within three to five weeks after the filing of a bankruptcy petition, the debtor must appear at what is called the Section 341 Meeting – or the Meeting of Creditors – under 11 U.S.C. § 341. These meetings are now conducted by video and debtors may appear from home or at my office. Creditors rarely attend the meeting. At the meeting, the debtor will be sworn in under oath, and the trustee appointed to the proceeding will ask questions about the debtor’s financial situation. Read more about common questions at the meeting of creditors. If the debtor does not appear at this meeting, their case will be dismissed.

Further Proceedings

Within 30 days after the conclusion of the meeting of creditors, the bankruptcy trustee and any other party in interest to the proceedings may file an objection to the debtor’s claims of exemptions in property. Additionally, the debtor’s creditors must file any objections to the debtor’s discharge, or the dischargeability of a particular debt within 60 days after the first date set for the meeting of creditors.

In a Chapter 13 case, a confirmation hearing is scheduled to be held within 20 to 45 days after the meeting of creditors, although it is often adjourned for a variety of reasons. The debtor is generally required to attend the confirmation hearing, although the debtor’s appearance may be excused if the debtor’s attorney appears at the hearing. Whether the debtor must appear at the confirmation hearing will be determined by the particulars of the case, the judge’s procedures, and the Chapter 13 trustee’s practices.

Bankruptcy Discharge

A bankruptcy discharge releases the debtor from personal liability for specified types of debt incurred prior to the filing of the bankruptcy case, meaning that the debtor is no longer legally obligated to repay these debts. However, certain debts may not be discharged. The discharge prohibits creditors from taking any collection actions against the debtor after the discharge. This includes legal actions, as well as communications such as phone calls, letters, and other forms of contact.

In a Chapter 7 case, as long as there are no objections, either by the bankruptcy trustee, the United States Trustee, or a creditor, the debtor will receive a discharge approximately 60 days after the first date set for the meeting of creditors. In Chapter 13, the discharge is entered after successful completion of the repayment plan, which takes between three and five years. However, under certain circumstances, a debtor may receive a Chapter 13 hardship dischargeif unable to complete the terms of the plan.

Although a debtor’s personal liability to repay his or her debts is discharged, any liens on the debtor’s property will remain after discharge, unless those liens were voided or otherwise extinguished in the bankruptcy proceeding. Read more about liens and bankruptcy.

There are time restrictions on the debtor’s ability to file a subsequent bankruptcy proceeding after receiving a discharge. Read more about the required time between bankruptcy filings.

Finally, a debtor may voluntarily repay discharged debts after the discharge has been granted. A debtor may wish to do so if a debt is owed to a friend or family member, or to maintain a good relationship with a creditor, such as a family doctor.

Free Consultation About Filing for Bankruptcy in New York

Contact the Law Office of Andrew M. Doktofsky today to answer your questions about filing for bankruptcy. Andrew M. Doktofsky represents clients in Suffolk County, Nassau County, New York City, and surrounding areas. Call (631) 673-9600 or complete the contact form below.

Andrew M. Doktofsky P.C.  is a debt relief agency. I help people file for bankruptcy relief under the Bankruptcy Code.

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