Prior Bankruptcy Prevents Filing of Chapter 7
You are prohibited from receiving a discharge under Chapter 7 if you received a discharge in a bankruptcy which was filed within the last 6 years. A discharge may still be granted if the prior bankruptcy was under Chapter 12 or 13 and paid 100% of allowed unsecured claims, or paid at least 70% allowed unsecured claims and the plan was proposed in good faith and was the your best effort.
This restriction does not apply to the filing of a Chapter 13 after any prior bankruptcy.
Transfer, concealment or destruction of property prevents discharge in Chapter 7
The court may deny you discharge of all debt if you attempted to hinder, delay or defraud a creditor when you transferred, removed, destroyed, mutilated, or concealed property within one year prior to the filing of your Chapter 7 petition.
The trustee may recover the property from the person to whom you transferred it.
A total of $600 or more in money or property which is paid to a creditor that is a relative or insider (certain business associates) within a year prior to filing is a preference. The Trustee may recover preferences and divide the money between all creditors.
In Chapter 13, you may be able to prevent the trustee from going after the relative by increasing the amount paid into your plan.
Dismissal of prior bankruptcy prevents filing Chapter 7 or 13.
You may not file any bankruptcy if you filed a previous bankruptcy which was dismissed in the preceding 180 days either (1) on the court's order because of your willful failure to obey orders of the court or to appear in court when required; or (2) at your request after the filing of a request for relief from the automatic stay.
Minimum Residency Requirement
You must be a resident in the state in which you are filing for the last 90 days. If you have not resided in the state that long, you can only file in the state where you have resided, or which has been your principal place of business or which has been the location of your principal assets for the majority of the last 180 days.
Payment to Creditor is a Preference
A total of $600 or more in money or property which is paid to a creditor within 90 days prior to filing is a preference. The Trustee may recover preferences and divide the money between all creditors.
In Chapter 13, you may be able to prevent the trustee from going after the creditor by increasing the amount paid into your plan.
Debt presumed to be non-dischargeable
Debt of $1,075 for cash advances or "luxury goods or services" incurred within 60 days before the Bankruptcy is filed is presumed to be non-dischargeable.
Applies to Chapter 7 cases, and to hardship discharge in Chapter 13.
Commencement of Case
A voluntary bankruptcy is commenced when you file a petition with the Bankruptcy Court requesting protection from your creditors under Chapter 7 or Chapter 13. A husband and wife may file one petition together and commence a joint case.
The filing also puts a stay under 11 U.S.C. §362 into effect prohibiting collection actions.
Deadline to File Schedules and Financial Statement, and Chapter 13 Plan
Within 15 days after filing the Chapter 7 or Chapter 13 petition that commenced your case, you must file schedules listing your assets and liabilities, your current income and expenditures, executory contracts and unexpired leases, and a statement of your financial affairs.
In Chapter 13, the Plan must also be filed within 15 days after the Bankruptcy was filed. The plan provides for submission of future income and the treatment of your creditors, specifying when and how much each kind of creditor will receive.
Court Mails Notice of Commencement of Case
Approximately 18 days after your case is commenced, the court mails a Notice of Commencement of Case to you and to the creditors you have included in your mailing list. The notice contains meeting date, deadlines for objections to discharge and for filing Proofs of Claims.
Chapter 13 only: Deadline to Notice Chapter 13 Plan
In the Eastern District of Michigan, your attorney must mail your Chapter 13 Plan to all creditors after the Chapter 13 Plan is filed.
Chapter 7 only: Deadline to file Statement of Intention
Within 30 days after filing the Chapter 7 petition that commenced your case (or before the § 341 meeting if that is earlier), you must file a Statement of Intention indicating whether you will be surrendering or keeping property secured by consumer debt. If you are keeping secured property, you will need to indicate whether you intend to: (1) reaffirm the debt and continue to make the payments remaining obligated for the balance of the debt, or (2) redeem the property by immediately paying the value of the property and receive a discharge for the balance of the debt.
A copy of the Statement of Intention must be served on the trustee and the creditors named in the statement on or before the filing of the statement.
Chapter 13 only: First Payment Due Under Chapter 13 Plan
You must make your first payment under the Chapter 13 Plan within 30 days after the plan was filed.
If your plan was filed with the petition which commences your case, your first payment is due within 30 days of the start of the case. Since the plan must be filed within 15 days after the commencement of your case, the latest date you may start making payments is 45 days after the filing of the case.
§ 341 Meeting
Section 341 (the symbol "§" means section) of the Bankruptcy code requires the Trustee to preside at a meeting of creditors within a "reasonable time." This meeting is usually held approximately six weeks after Bankruptcy is filed.
You (as the debtor in a Bankruptcy case) are required to attend this meeting and testify under oath, but most creditors do not come to the meeting. The failure of creditors to attend the meeting does not effect their right to challenge the discharge in a Chapter 7 or to object to the plan in a Chapter 13. If you do not attend, your case will be dismissed.
Chapter 7: Deadline in Chapter 7 to perform under Statement of Intention
In Chapter 7, within 45 days after you filed Statement of Intention, you are to perform as you indicated. In that statement, you were required to state whether you would be surrendering or keeping property secured by consumer debt. If you were keeping secured property, you would have indicated whether you intended to: (1) reaffirm the debt and continue to make the payments remaining obligated for the balance of the debt, or (2) redeem the property by immediately paying the value of the property and receiving a discharge for the balance of the debt.
Deadline for creditors or Trustee to object to claim of exempt property
Creditors and the Trustee have until 30 days after the conclusion of the creditor's meeting under § 341 to object to the property you have claimed as exempt in Schedule C. While most § 341 meetings are concluded on the same day they are set, it is not unusual for a meeting to be continued to a subsequent date, which will extend the time that creditors have to object.
Chapter 7: Deadline in Chapter 7 for objection to discharge of a particular debt under §523(c)
Creditors have until 60 days after the first date set for creditor's meeting under § 341 to file a complaint under § 523(c). § 523(c) allows creditors to object to the discharge of debts which were obtained by false pretenses, a false representation, or actual fraud; debt from fraud or defalcation while acting in a fiduciary capacity, embezzlement or larceny; debt for willful and malicious injury; and debt incurred in a divorce or separation (other than child support and spousal maintenance which are not discharged even without an objection to discharge).
The most common objection to discharge of a debt is based on § 523(a)(2). This section presumes that charges totaling $1,000 or more to one creditor within 60 days before the case is commenced are not discharged, if they are for luxury goods or services, or cash advances. This section also denies a discharge to debt extended because the creditor relied upon a credit application which was materially false.
Chapter 7: Deadline for objection to discharge of all debt under §727(a)
Creditors have until 60 days after the first date set for creditor's meeting under § 341 to file a complaint under § 727(a). § 727(a) allows object to the discharge of all debts because of misconduct including transfer, destruction or concealment of property; concealment, destruction, falsification or failure to keep financial records; making false statements; withholding information; failing to explain losses; failure to respond to material questions; having received a discharge in a prior case filed within the last 6 years.
Chapter 7: Deadline for U.S. Trustee or court to move to dismiss case for substantial abuse under §707(b)
Until 60 days after the first date set for creditor's meeting under § 341, the U.S. Trustee or the court may move to dismiss a case in which debts are primarily consumer debts if it finds that the granting of relief would be a substantial abuse of the provisions of Chapter 7.
Substantial abuse has been interpreted by a number of courts to mean having sufficient disposable income to pay more than half of your unsecured debt over the next 36 months.
Chapter 13: Deadline in Chapter 13 to file all due but unfiled tax returns
For cases filed in the Eastern District of Michigan, you must file all due but unfiled tax returns within 60 days after the first date set for the § 341 Meeting.
Discharge entered in Chapter 7 case
Court rules require that the discharge be entered "forthwith" after the expiration of the time for objecting to discharge or moving to dismiss the case. The time for those objections expires 60 days after the first date set for creditor's meeting.
The discharge is not absolute or final. The trustee can ask that the discharge be set aside if you do not turn over non-exempt property, and for other violations of the debtor's duties.
Deadline for non-government creditor to file its Proof of Claim
A creditor, other than a governmental unit, must file its Proof of Claim within 90 days after the after the first date set for creditor's meeting under § 341 in order to share in payments from the estate.
Deadline for governmental unit to file Proof of Claim
A governmental unit, such as the Internal Revenue Service, must file its Proof of Claim within the commencement of the case in order to share in payments from the estate.
Minimum length of payments under Chapter 13 Plan
Unless all allowed claims are paid sooner, plan payments must continue for the three-year period beginning on the date that the first payment is due under the plan. During this period, the plan must provide that all of the debtor's projected disposable income is committed to the plan. (This requirement comes into effect only if the trustee or the holder of an allowed unsecured claim objects; it has been our experience that the trustee will always object.)
Discharge entered in Chapter 13
Upon completion of plan payments the discharge in Chapter 13 is entered.
Maximum length of payments under Chapter 13 Plan
The maximum length of a Chapter 13 plan is five years beginning on the date that the first payment is due under the plan. After the third year of the plan, the plan no longer needs to provide that all of the disposable income be committed to the plan.
Discharge entered in Chapter 13
Upon completion of plan payments the discharge in Chapter 13 is entered.
I vigorously protect my clients rights and protect them from creditor abuse. I have helped many families and individuals overcome the stress that financial problems can cause. My expertise as a bankruptcy lawyer always results in savings that far outweigh the amount of legal fees in a case.