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, New York, 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.
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.
How A Bankruptcy Attorney Can Help You
Only an experienced bankruptcy attorney can:
- Properly advise you as to whether you should file for bankruptcy
- Advise you as to the proper timing of a bankruptcy filing
- Properly advise you regarding property exemptions
- Represent you at the Meeting of Creditors
- Represent you in proceedings in the Bankruptcy Court
Attorney Andrew M. Doktofsky is knowledgeable and experienced with New York bankruptcy procedures and will guide you through every step of the bankruptcy process.
Information Center For The Bankruptcy Process
- Steps in the Bankruptcy Process
- Notice to Creditors
- Meeting of Creditors
- Bankruptcy Discharge
- Bankruptcy Process Resources in New York
Steps In The Bankruptcy Process In New York
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 at my office. We will tell you what documents to bring with you to the first official meeting.
Step Two – Office Consultation
During the initial office visit, 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.
Step Four – Filing With The Bankruptcy Court
The petition is filed with the Bankruptcy Court electronically. It is the filing with the court that actually 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).
Sending 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.
What To Expect At The Meeting Of Creditors
Approximately three to five weeks after the bankruptcy petition is filed, the trustee who is assigned to your case will hold a Meeting of Creditors, which is also called a Section 341 Meeting. Although the meeting may be held at the bankruptcy courthouse, it will not be conducted in front of a bankruptcy judge. Rather, the meeting is held with a bankruptcy trustee. There will be other people in the room who are also present for their meeting.
During this meeting, the trustee will place the debtor under oath, and the debtor will be asked questions by the trustee. Debtors are required to answer questions regarding their financial situation, including income, assets, debts, and property transfers. If spouses have filed a joint petition, they are both required to attend the meeting. Despite the name of the meeting, creditors rarely attend, and the meeting is usually concluded very quickly. Creditors that do attend may also ask questions of the debtor.As long as you are not the first debtor called, you will be able to listen to the questions that the trustee is asking. He or she will be asking you similar questions.
Typical questions the trustee will ask the debtor at the Section 341 meeting in a Chapter 7 case include the following:
- Did you read the petition before you signed it?
- Is everything in the petition true and correct?
- Do you wish to make any changes?
- Have you listed all of your debts?
- Have you listed all of your assets?
- What do you do for a living?
- Have you ever refinanced your home or taken a home equity loan?
- If so, and you received any proceeds, what did you do with those funds?
- Have you ever owned any real property other than your current ownership?
- If so, what happened to the property?
- Are you in business for yourself?
- If not, have you ever been in business for yourself?
- If so, what happened to the assets of the business?
- Does anyone owe you any money?
- Do you have any potential claims for personal injury?
- Can you sue anyone for any reason?
- Has anyone died and left you any property?
- Do you expect to inherit any property in the next six months?
- Did you receive a tax refund this year?
- Do you expect to receive a tax refund?
- Have you repaid any friends or family members in the past year?
- Have you transferred any property to anyone in the last six years?
- What is the most money you have had in the bank in the past two years?
- What caused you to go into debt?
Usually, in a Chapter 7 case, nothing more is required after the Meeting of Creditors. Chapter 13 bankruptcy proceedings are somewhat different than Chapter 7. At the meeting with the Chapter 13 bankruptcy trustee, the focus is often on the debtor’s income and the debtor’s ability to make the payments under the proposed Chapter 13 plan. Approximately one month after the Section 341 meeting, a hearing to confirm the debtor’s Chapter 13 plan will be scheduled.
If the debtor has made the required payments to the Chapter 13 trustee, and there are no objections to the plan, the trustee will usually recommend confirmation of the plan. Once the plan is confirmed by the Bankruptcy Court, the debtor and creditors are bound by the terms of the repayment plan. The confirmation hearing may or may not be in front of a bankruptcy judge, depending on the particular judge’s rules.
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 usually receive a discharge approximately 60 days after the first date set for the meeting. In Chapter 13, the discharge is entered after successful completion of the repayment plan, which usually takes between three and five years. However, under certain circumstances, a debtor may receive a Chapter 13 hardship discharge if 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.
In order to receive a discharge, the debtor must complete a course on financial management.
Additionally, 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.
Next: How bankruptcy works
Get Help From An Experienced Bankruptcy Attorney Today
Contact The Law Office of Andrew M. Doktofsky, P.C., today for a consultation about the bankruptcy process in Suffolk County, Nassau County, and Long Island. Attorney Andrew M. Doktofsky will answer your questions about how bankruptcy works, and help guide you through the bankruptcy process. Call 631-812-7712 to discuss how you can file for bankruptcy.
This is a debt relief agency. I help people file for bankruptcy relief under the Bankruptcy Code.