Bankruptcy (before production 1)

Bankruptcy is an instance of the Federal Court in which a consumer can get protection from creditors. There are two general types of bankruptcy: voluntary (Chapter 7) and involuntary (Chapter 13). Voluntary bankruptcy is launched when a consumer files a petition, while that in an involuntary bankruptcy creditor forces consumer deposit.

How does it work?

In the bankruptcy Abuse Prevention and Consumer Protection Act or BAPCPA, which changed the bankruptcy code to United States dated 17 October 2005 consumer must first undergo compulsory credit courses (pursuant to a court approved entity counseling credit) orientation prior to the bankruptcy filing.

-Upon completion and if it was decided that bankruptcy is the best and the only solution to the situation of the consumer debt, he fills out a form, which is an application to the Court to make its statement of legal bankruptcy.

-With filing, there is a fee payable to the courts.
What makes mandatory counseling credit?

Mandatory counselling ensures that the consumer knows has options other than bankruptcy.

Orientation of credit shall be:

-Approved by the Office of the u.s. Trustee.
-Completed within 180 days before filing bankruptcy.

This session of pre-bankruptcy counseling should include:

-An assessment of the financial situation of the consumer
-A discussion of alternatives to bankruptcy.
-A 2-hour course on personal financial management (budget counseling).

Consumers at the end of the programme shall be:

-Certificate of completion counseling (prenotification)

-Debtor education (post-filing certificate.

What is the consequence of the inability to obtain these certificates?

-If the consumer is unable to complete the course and failed to obtain a debtor end training certificate within the required period, the case may be dismissed by the Court and bankruptcy will step be rejected.

Is it possible to be exempted from credit counseling?

-The Court excuse a consumer who is mentally impaired or a military combat zone.

-Even if an appropriate agency is not available in the district of the consumer or if the consumer has a physical disability which prevents to travel, it can step is exempt class, because it is also available by telephone or ligne.Si consumer prefers not travel and instead take the last two options, it must first of all clear with the trustee.

-Another way to prevent attendance if the consumer can prove to the Court that he or she should immediately submit bankruptcy: to stop an emergency move by the lender, such as garnishment of wages and the consumer has failed to obtain advice within five days after he asked it .the consumers has30 days to prove the immediacy and Court to 15 days if an extension is granted.

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