Anyone thinking about filing for bankruptcy is likely dealing with an almost daily influx of information and demands sent through the mail or communicated over the phone. This mounting pile of information can easily overwhelm a person as he or she tries to figure out when and how to respond. Bankruptcy is a process that was created to lift the burden of crushing debt, but it is entirely driven by the information most debtors consciously try to avoid. This means that a large amount of documents and data must be gathered in advance of filing for bankruptcy so the debtor can present a complete report of their financial situation to the bankruptcy court. A bankruptcy attorney will use this information to determine which type of bankruptcy makes sense for the debtor, and to identify which creditors have a viable claim. Consequently, presenting a full and accurate picture of a person’s finances is crucial to receiving the optimal outcome allowable under bankruptcy law. An overview of documents needed to file for bankruptcy and during the early stages of the process,will follow below.

Petition

This document tells the court that the petitioner wants to declare bankruptcy and seek relief from accumulated debt through the legal process. The form requires the debtor to provide basic personal information, such as name, address, and social security number. The debtor must also select the bankruptcy chapter he/she is electing to use to reduce or eliminate debts, and any past or pending bankruptcy cases. In addition, a rough estimate of the number of creditors, the value of any assets, and how much debt is outstanding must be provided. Note that there is a filing fee charged in Chapter 7, but the court may permit the debtor to pay it in installments or waive it completely.

Property Schedules

This form asks the debtor to list and describe all the real and personal property he or she owns including the type of property (i.e., a home, vehicle, household items, stocks, pensions, etc.), how much the property is worth, and if anyone else has an ownership interest in it. In addition, the debtor must submit a form that outlines property he or she is claiming as exempt from bankruptcy. Indiana limits residents to the exemptions allowed under state law, so federal bankruptcy exemptions are not available.

Creditor Schedules

These forms list all the creditors to which the debtor owes money, and is divided by whether the creditor holds a claim secured by property or not. Information about the debt and creditor, including if there are any co-debtors, and the date the debt was incurred, must also be provided.

Contracts and Leases Schedule

In this document, the debtor must list all contracts and leases that are currently in effect and describe what rights and/or obligations the debtor has under the terms of the agreement. Examples of arrangements that would fall under the schedule include, car leases, real estate contracts, and rental agreements.

Income Schedule

Here, the bankruptcy court wants an accounting of a debtor’s monthly income in light of all the money a debtor receives, and not just what he/she earns from employment. This includes any money regularly collected for things such as rental income, pension payouts, social security, and unemployment. Payroll deductions are also used in the calculation of monthly income, and the debtor must tell the court if he/she expects a change in income over the next year.

Expenses Schedule

As the name suggests, this form is where the debtor lists all monthly household expenses, including rental or mortgage payments, utilities, childcare costs, and transportation.

Statement of Intention – Chapter 7

Finally, in the Statement of Intention, which relates to secured creditors that hold an interest in the debtor’s property, the Chapter 7 debtor must declare how they intend to address this debt. Generally, the debtor has one of three options: surrender the property, redeem the property by paying off the debt, or reaffirming the debt in a new agreement.

Consult a Bankruptcy Attorney

As the above list shows, filing for bankruptcy is a complex process that can easily trip up or overwhelm a person not familiar with the process. An experienced bankruptcy attorney will know the nuances of a bankruptcy and prevent you from a making a costly mistake. Christopher L. Arrington represents bankruptcy clients in the Indianapolis area, and can help you get a fresh start debt-free. Contact him for an appointment.