Introduction
Filing for bankruptcy can be a complex and overwhelming process, but understanding the necessary steps can help you navigate through it more smoothly. This article will provide a comprehensive guide on how to file bankruptcy in Missouri, covering the essential information you need to know.
Types of Bankruptcy
Before diving into the process, it’s important to understand the types of bankruptcy available in Missouri. The most common types are Chapter 7 and Chapter 13 bankruptcy.
Chapter 7 Bankruptcy: This type of bankruptcy, also known as liquidation bankruptcy, involves the sale of non-exempt assets to repay creditors. It provides a fresh start by discharging most unsecured debts.
Chapter 13 Bankruptcy: Unlike Chapter 7, Chapter 13 bankruptcy allows individuals with a regular income to create a repayment plan to pay off their debts over a period of three to five years. This type of bankruptcy is suitable for those who want to keep their assets and catch up on missed payments.
Eligibility Requirements
To file for bankruptcy in Missouri, you must meet certain eligibility requirements. These requirements vary depending on the type of bankruptcy you choose.
Chapter 7 Bankruptcy Eligibility: To qualify for Chapter 7 bankruptcy, you must pass the means test, which compares your income to the median income in Missouri. If your income is below the median, you are eligible. If it exceeds the median, further calculations are required to determine eligibility.
Chapter 13 Bankruptcy Eligibility: Chapter 13 bankruptcy does not have a means test. However, you must have a regular income and your unsecured debts should not exceed a certain limit (currently $419,275) and secured debts should not exceed $1,257,850.
The Filing Process
1. Credit Counseling: Before filing for bankruptcy, you must complete a credit counseling course from an approved agency. This course can be taken online or over the phone. Upon completion, you will receive a certificate that is valid for 180 days.
2. Complete Bankruptcy Forms: The next step is to gather all the necessary information and complete the bankruptcy forms. These forms include a petition, schedules, and statements of financial affairs. It is crucial to provide accurate and detailed information to avoid complications later.
3. Filing the Forms: Once the forms are completed, you need to file them with the bankruptcy court in your district. Along with the forms, you must also pay the required filing fee, which is currently $338 for Chapter 7 and $313 for Chapter 13.
4. Automatic Stay: Once the forms are filed, an automatic stay goes into effect, which prevents creditors from taking any further collection actions against you. This provides immediate relief and gives you time to work through the bankruptcy process.
5. Meeting of Creditors: Approximately 20-40 days after filing, you will attend a meeting of creditors, also known as the 341 meeting. During this meeting, the bankruptcy trustee and creditors have the opportunity to ask you questions about your financial situation and bankruptcy filing.
6. Financial Management Course: After the meeting of creditors, you must complete a financial management course from an approved agency. This course focuses on budgeting and financial planning.
7. Discharge of Debts: If everything goes smoothly and there are no objections from creditors, you will receive a discharge order from the court. This order eliminates your personal liability for most debts included in the bankruptcy.
Conclusion
Filing for bankruptcy in Missouri can be a complex process, but understanding the steps involved can help alleviate some of the stress. Whether you choose Chapter 7 or Chapter 13 bankruptcy, it’s important to meet the eligibility requirements, complete the necessary forms accurately, and comply with all court requirements. Consulting with a bankruptcy attorney can also provide valuable guidance throughout the process.
References
– United States Courts: www.uscourts.gov
– United States Bankruptcy Court – Eastern District of Missouri: www.moeb.uscourts.gov
– Missouri Bankruptcy Center: www.missouribankruptcycenter.com
