Things to Know About Emergency Filings for Chapter 7 or Chapter 13 Bankruptcy Protection

Consumer Bankruptcy Attorneys typically offer free consultations to men and women considering this form of debt management. These individuals may want to interview two or three lawyers before they decide to file. That way, they’ll feel more certain about the attorney they select. This is not required, of course, and people who are facing the need to file for bankruptcy quickly may feel comfortable hiring the first and only lawyer they speak with.

Preventing Imminent Foreclosure

Why would someone need to make an emergency filing with Bankruptcy attorneys? One reason is to block an impending action by a creditor; home foreclosure is a common action people seek to stop at the last minute. The homeowners may have been fighting the bank for a long time, trying to be approved for a loan modification or installment plan to pay the arrears. Their only recourse now is to file bankruptcy.

Chapter 7

With chapter 7 bankruptcy, foreclosure proceedings will be halted temporarily, but the people will still lose the home if they cannot make up the back payments or be approved for one of the lender’s programs. For now, however, they have more time to find a place to move to and pack their belongings.

Chapter 13

The alternative form of filing for individuals, chapter 13 bankruptcy, may help them keep their home. This is a repayment program lasting up to five years. If the person is approved for a five-year plan, the program combines all the debt owed and divides it into 60 payments that are then distributed each month to the creditors. Mortgage arrears can be included in this. The person must have enough income to make the monthly payment and pay all other expenses or the bankruptcy judge will not approve the application.

Requirements for Emergency Filing

Filing for bankruptcy has specific requirements that normally must be completed before the paperwork is provided to the court, but exceptions can be made for emergency situations. The emergency paperwork is sent and the rest of the documentation is completed afterward. Legally, this is known as a skeletal petition for bankruptcy. The remainder of the paperwork must be filed within 14 days.

Credit counseling before filing either Chapter 7 or Chapter 13 is mandatory, even in an emergency situation. Fortunately, this can usually be completed online or on the phone without having to wait. The person receives a certificate verifying the completion of credit counseling. The certificate must be dated a minimum of one day before the filing.

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