- Credit counseling from a non-profit budget and credit counseling agency is now a prerequisite for filing bankruptcy. Credit counseling must be completed within 180 days of filing, and may be completed by phone, internet, or in person.
- There is now a continuing education requirement for those involved in bankruptcy proceedings. Debtors must complete an instructional course on financial management in order to receive their final discharge. This course may be completed over the phone, internet, or in person.
- All individuals, who are not in business, and are seeking bankruptcy relief will be required to qualify under the new “means test.” Contact us to learn more.
If you have questions regarding debt relief or whether you should file for bankruptcy, call Steinhilber, Swanson, Mares, Marone, and McDermott.
We are a debt-relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
Steinhilber, Swanson, Mares, Marone, and McDermott serves clients throughout the Fox Valley area of Wisconsin, including the cities of Appleton, Beaver Dam, Chilton, Green Bay, Hartford, Kaukauna, Neenah, New London, Manitowoc, Menasha, Omro, Oshkosh, Red Granite, Shawano, Sheboygan, Waupaca, and West Bend, Wisconsin.
What you will need to file bankruptcy
1. Names, correspondence addresses, the approximate date when debt incurred and for what, and the amount owed to all creditors
2. Personal Income Tax Returns for the last 2 years
3. Most recent 6-months of paycheck stubs from all employers, as well as any unemployment income information and social security income.
4. Copies of real estate tax bills for any land or homes
5. Copies of all recorded mortgages (copies may be obtained from the Register of Deeds in the County in which the real property is located)
6. List of Monthly Household Expenses
7. List of assets, including all household goods with actual cash values (aka rummage sale prices) and appraisals of real property if available
8. Copies of titles to all cars, trucks, boats, and recreational vehicles
9. Credit Counseling Certificate (we will help you with this)
Frequently Asked Questions
1. Will my bankruptcy going to be published in the paper?
A bankruptcy is on the public record. However, most newspapers no longer publish bankruptcy information. While they still publish foreclosures and court actions, bankruptcy is a federal action and is generally only available on the United States Bankruptcy Court’s website.
2. Will I lose my vehicle?
If you have a loan secured by your vehicle and are up-to-date on your payments, your bank and the court may allow you to reaffirm the original contract on the vehicle. If you are behind on payments you will need to get them up-to-date or possibly enter into a chapter 13 bankruptcy to cure any defaults.
3. If I surrender my home or vehicle will I be responsible for the difference between the loan amount and the amount my home or vehicle sells for?
Yes, you could be held liable for the deficiency. These amounts can both be put into a bankruptcy and may be discharged.
4. Is there a court hearing?
You will have to go to what is called a “Section 341 hearing.” This hearing is also called a trustee meeting or a meeting of creditors. Generally, you will meet with the trustee for a 5 -10 minute hearing. Your attorney will be there with you and as the name implies, creditors are allowed to attend and ask questions. The trustee will verify that you are who you say you are and put you under oath to answer the questions concerning your bankruptcy filing. This meeting is generally where the trustee determines whether your case is an “asset case” or a “no asset case.” Most cases are determined to be a no asset case, which means the trustee determines that there is no property of yours that can be sold for the benefit of the creditors.
5. Could I lose my job because I filed bankruptcy?
It is illegal to discriminate against a person because they filed bankruptcy.
6. Will the trustee take my furniture, retirement, or other personal assets?
You are required to disclose all of your personal and real property and make a reasonable inquiry into the values of those items. There are federal and state exemptions that your attorney will go over with you to protect most if not all of the equity in your personal and real property.
Types of Bankruptcies
Chapter 7 / Debt liquidation
Chapter 7 is designed for debtors in financial difficulty who do not have the ability to pay their existing debts . Debtors whose debts are primarily consumer debts are subject to a “means test” designed to determine whether the case should be permitted to proceed under Chapter 7. If your income is greater that the median income for your state of residence and family size, in some cases, creditors have the right to file a motion requesting that the court dismiss your case under Section 707(b) of the Code. It is up to the court to decide whether the case should be dismissed. In such a case, there may be an option to convert to a Chapter 13 reorganization.
Under Chapter 7, you may claim certain of your property as exempt under governing law. A trustee may have the right to take possession of and sell the remaining property that is not exempt or otherwise pledged and use the sale proceeds to pay your creditors.
The purpose of filing a Chapter 7 case is to obtain a discharge of your existing debts. If, however, you are found to have committed certain kinds of improper conduct toward your creditors as described in the Bankruptcy Code, the court may deny your discharge and, if it does, the purpose for which you filed the bankruptcy petition will be defeated.
Even if you receive a general discharge, some particular debts are not discharged under the law. Therefore, you may still be responsible for most taxes and student loans; debts incurred to pay non-dischargeable taxes; domestic support and property settlement obligations; most fines, penalties, forfeitures, and criminal restitution obligations; certain debts which are not properly listed in your bankruptcy papers; debts resulting from death or personal injury caused by operating a motor vehicle, vessel, or aircraft while intoxicated from alcohol or drugs. Also if a creditor can prove that a debt arose from fraud, breach of fiduciary duty, or theft, or from a willful and malicious injury, the bankruptcy court may determine that the debt is not discharged.
Chapter 11/Business Reorganization
Chapter 11 is designed for the reorganization of a business but is also available to individual debtors. Its provisions are quite complicated, and any decision by an individual to file a Chapter 11 petition should be reviewed with an attorney.
Chapter 12/ Family Farmer or Fisherman
Chapter 12 is designed to permit family farmers and fishermen to repay their debts over a period of time from future earnings and is similar to a Chapter 13. The eligibility requirements are restrictive, limiting its use to those whose income arises primarily from a family-owned farm but may provide a method by which to reamortize debt and deal with unsecured trade debt.
Chapter 13 / Debt repayment
Chapter 13 is a wage earner repayment plan. It is designed for individuals with regular income who would like to pay all or part of their debts in installments over a period of time. You are only eligible for Chapter 13 if your debts do not exceed certain dollar amounts set forth in the Bankruptcy Code. Under a Chapter 13, you must file a plan with the court which proposes to repay your creditors all or part of the money that you owe them, from your future earnings. The period allowed by the court to repay your debts may be three years or five years, depending upon your income and other factors.
The court must approve your plan before it can take effect. After completing the payments under your plan, your debts are generally discharged except for domestic support obligations; most student loans; certain taxes; most criminal fines and restitution obligation; certain debts which are not properly listed in your bankruptcy papers; certain debts for acts that caused death or personal injury; and certain long term secured obligations.
A Chapter 13 bankruptcy filing may:
Allow you to stop foreclosure on your home
Give you time to catch up on your house payments
Stop repossession of your vehicle
Stop the IRS from garnishing your wages
Changes in Bankruptcy Law in 2005/2006
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, opened a new era in the history of bankruptcy law and practice. The Act was passed by Congress and signed into law by President Bush on April 20, 2005. The United States Trustee Program is the component of the Department of Justice that protects the integrity of the nation’s bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws.
The Act gives the U.S. Trustee Program new responsibilities:
Tto implement the new “means test” to determine whether a debtor is eligible for chapter 7 (liquidation) or must file under chapter 13 (wage-earner repayment plan);
To supervise random audits and targeted audits to determine whether a chapter 7 debtor’s bankruptcy documents are accurate;
To certify entities to provide the credit counseling that an individual must receive before filing bankruptcy;
Certifying entities to provide the financial education that an individual must receive before discharging debts; and
To conduct oversight in small business chapter 11 reorganization cases.
Domestic Support Obligations (Child Support, Maintenance, etc)
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) at 11 U.S.C. § 704(10) and 11 U.S.C. § 1302(b)(6) requires the chapter 7 or chapter 13 trustee, if there is a claim for a domestic support obligation in a case, to provide written notice (with certain required information) to (1) the holder of the domestic support obligation claim, and (2) the applicable State Child Support Enforcement Agency established by §§ 464 and 466 of the Social Security Act. A notice at the time of filing and a second notice at the time of discharge are required. In the notice to the holder of the domestic support obligation, the trustee must provide contact information for the State Child Support Enforcement Agency.
Other Helpful Links
United States Bankruptcy Court Eastern District of Wisconsin
United States Bankruptcy Court Western District of Wisconsin
United States Bankruptcy Trustee
Trustee Thomas King - Chapter 13 Bankruptcy Trustee
Institute for Financial Literacy - Fresh Start
FISC
Green Path
