The costs associated with filing for chapter 7 consist of a mandatory $245 case filing fee, a $39 administrative fee for miscellaneous services, and a $15 trustee surcharge. After filing a petition, these fees can be paid to the court registrar; however, the court may allow individual debtors to pay these fees in installments under certain conditions. If an individual debtor cannot afford to pay the requisite fees, the court may even grant a fee waiver relieving him or her of this obligation. A debtor who fails to pay these fees may have their case dismissed.
The procedure of filing for chapter 7 bankruptcy begins with the debtor filing a petition in federal court. Along with this petition, the debtor must include all documentation necessary to demonstrate his or her current financial circumstance. Download the Official Forms from the Internet at http://www.uscourts.gov/bkforms/index.html.
The court then appoints a bankruptcy trustee to oversee the entire bankruptcy proceeding. The trustee is responsible for liquidating all non-exempt assets, distributing the proceeds to creditors, and presiding over the creditors' meeting. The trustee serves as an intermediary between the court and the debtor.
Upon filing a petition under chapter 7, a debtor can automatically halt most collection actions against the debtor or the debtor's property via a """"Order for Relief"""". This implies that creditors cannot pursue payment from the debtor while the stay is in effect. When creditors receive notice of the bankruptcy case from the court, this action is taken. However, any """"secured debt"""" belonging to the debtor, which is property used as collateral for a loan, does not typically prevent creditors from pursuing collection actions against a delinquent debtor.
The Meeting of Creditors, also known as the ""341 Hearing,"" is the gathering of the trustee, the delinquent, and the creditors. The debtor must attend the meeting and respond truthfully to inquiries about his or her financial situation. The trustee is also responsible for ensuring that the debtor comprehends the nature of his bankruptcy petition and the outcome of the proceeding. The trustee will report to the court shortly after the creditors' meeting on whether the case should be discharged.
At the conclusion of the bankruptcy procedure, the court will notify the debtor in writing that he has been discharged from all debts. Child support, the majority of tax debts, student loans, and debts that the court has deemed non-dischargeable because the creditor has objected typically survive bankruptcy.
A chapter 7 bankruptcy remains on an individual's credit report for ten years after the petition date. Additionally, a debtor may convert a chapter 7 case to a case under chapter 11, 12, or 13 if eligible.""
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