A bankruptcy filing can provide a certain amount of protection from your creditors once you file the documents with the court. If you are in need of immediate protection, you will need to file for an emergency bankruptcy. Before filing, here is what you need to know.
What Is the Benefit of Emergency Filing?
There are a number of benefits to filing for an emergency bankruptcy, but one of the most important is the automatic stay. The stay stops your creditors from taking any legal actions against you. For instance, if your mortgage lender has scheduled a foreclosure sale of your home, the stay would stop the sale for a period of time.
Your creditors receive notification as soon as the necessary documents are filed with the court. It is important to note that your creditors can go to court at any time and ask the court to lift the stay. If the judge agrees that the stay should be lifted, you could once again face legal actions from your creditors.
How Do You File?
Before you can file your petition for an emergency bankruptcy, you must complete a credit counseling class. Depending on the state in which you live, it is usually possible to take the class online. The local court clerk can provide you with a list of classes that have been approved.
Once you complete the class, you will be provided with a certificate. The certificate must be turned into the court with your emergency filing documentation.
The filing documentation is limited to the voluntary petition, creditor matrix, and Exhibit D form. The voluntary petition is a declaration of your income and your total debts. The creditor matrix is a detailed listing of your creditors. Exhibit D verifies that you completed the credit counseling class.
What Happens Next?
After the documents are filed with your local clerk's office, a stay will be issued. Depending on the state in which you live, you have 7 or 14 days after the filing to complete and turn in the remaining papers that are needed to file for bankruptcy. If you fail to turn in those forms, you could lose the protection of the stay and the court could dismiss your filing altogether.
If you considering an emergency bankruptcy filing, consult with an attorney. He or she can help you with completing the forms needed for the filing and also ensure you are prepared to turn in your remaining documentation within the period allowed.
For a bankruptcy attorney, contact a lawyer such as D Derk Demaree Attorney at Law.