Chapter 12 Bankruptcy

Chapter 12 Bankruptcy Brooklyn Attorney at Law

Chapter 12 Bankruptcy starts by filing a petition with the court that serves the area where the individual resides or where the corporation conducts its business. Unless otherwise stated by the court, the debtor is required to file a schedule of assets and liabilities, schedule of current income and expenses, schedule of unexpired leases and executory contracts and a statement of financial affairs. Husbands and wives have the option of filing a joint or an individual petition.

 When the paperwork is filed, you are responsible for paying the fees. If the court permits, the fees can be paid in payments. It is limited to four installments and the final payment must be made before 120 days from the date the petition was filed. If just cause is deemed appropriate, the court can extend the payment up to 180 days from the date of petition filing. If a joint petition is filed, only one fee needs to be paid. Failure to pay for any of the fees can cause the case to be dismissed.

Beyond completing all of the paperwork, other items need to be compiled as well. Compile a list of all the creditors, the amount owed to them and the nature of their claim. Write down your income amount, where it comes from and the frequency of pay. List any property that you have. Complete a list of all living expenses and farming expenses, such as food, utilities, shelter, transportation, taxes, medicine, fertilizer, feed and more.

Married couples need to gather all of the information for the spouse even if they are not filing a joint petition. In situations where only one spouse files, expenses and income of the other spouse are required so that the trustee and creditors can determine the financial position of the household. When a Chapter 12 petition is filed with the court, the court appoints an impartial trustee to handle the case. The trustee with evaluate the case and serve as the disbursement agent who collects the debtor payments and disburse them to the creditors.

Filing the petition with the court puts an automatic stay in place to stop any collection efforts against the debtor and their property. As long as the stay is in place, the creditors cannot initiate a lawsuit, wage garnishment or make calls to the debtor demanding payment. This automatic stay also protects the co-debtor on the accounts as well.

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