This BAPCPA Man cartoon is posted by the Oklahoma Bankruptcy Lawyer Blog with the express permission of the creators of BAPCPA Man:

For more information on the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy, read these previous blogs posts that I’ve written:

• What is Chapter 7 bankruptcy in Oklahoma?
• What is Chapter 13 bankruptcy in Oklahoma?
• What is the difference between Chapter 7 and Chapter 13 bankruptcy?

If you’re considering filing bankruptcy but aren’t sure which type of bankruptcy would be best for your specific situation, contact me today to schedule a FREE initial telephone consultation. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. Or just give me a call at 918-615-8260. I’ll answer all of your questions in plain English so that you can make a wise decision regarding which type of bankruptcy would be the most help to you.

Generally if you have lived in Oklahoma for the past 91 days, you may file bankruptcy here.

The general rule is that an individual can file bankruptcy in the state where he has lived the majority of the last 180 days.

So if you have lived in 2 states during the last 6 months, you would file in the state where you have lived 91 or more days out of the past 180 days.

Likewise, if you have lived in 3 states during the past 6 months, you would file in the state where you had lived 61 or more days out of the past 180 days.

And so on.

Source: 28 USC §1408.

Following are the questions your trustee is required to ask you at your bankruptcy hearing. Below these required questions are a list of sample questions your trustee may ask you depending on the facts of your case. If you have any questions about answering any of these questions, you should discuss them with your attorney before you meet with the trustee.

QUESTIONS THE TRUSTEE IS REQUIRED TO ASK YOU AT YOUR BANKRUPTCY HEARING (341(a) MEETING OF CREDITORS)

1.     State your name and current address for the record.

2.    Please provide your picture ID and social security number card for review.

a.     If the documents are in agreement with the § 341(a) meeting notice, a suggested statement for the record is:

“I have viewed the original state of ________ drivers license (or other type of original photo ID) and original social security card (or other original document used for proof) and they match the name and social security number on the § 341 (a) meeting notice.”

b.    If the documents are not in agreement with the 341(a) meeting notice, a suggested statement for the record is:

“I have viewed the original social security card (or other original document used for proof) and the number does not match the number on the § 341(a) meeting notice.  I have instructed the debtor (or debtor’s counsel) to submit to the court an amended verified statement by [date], with notice of the correct number to all creditors, the United States Trustee, and the trustee, and to file with the court a redacted copy of the notice, showing only the last four digits of the social security number, and a certificate of service.”

c.    When the documents do not match the petition, the trustee shall attempt to ascertain why, and shall report the matter to the United States Trustee.

d.    If the debtor did not bring proof of identity and social security number, the trustee shall determine why.

3.    Did you sign the petition, schedules, statements, and related documents and is the signature your own?  Did you read the petition, schedules, statements, and related documents before you signed them?

4.    Are you personally familiar with the information contained in the petition, schedules, statements and related documents?  To the best of your knowledge, is the information contained in the petition, schedules, statements, and related documents true and correct? Are there any errors or omissions to bring to my attention at this time?

5.    Are all of your assets identified on the schedules?  Have you listed all of your creditors on the schedules?

6.    Have you previously filed bankruptcy?  (If so, the trustee must obtain the case number and the discharge information to determine the debtor(s) discharge eligibility.)

7.    What is the address of your current employer?

8.    Is the copy of the tax return you provided a true copy of the most recent tax return you filed?

9.    Do you have a domestic support obligation?  To whom?  Please provide to me the claimant’s address and telephone number, but do not state it on the record.

10.    Have you read the Bankruptcy Information Sheet provided by the United States Trustee?

SAMPLE GENERAL QUESTIONS (To be asked when deemed appropriate.)

1.    Do you own or have any interest whatsoever in any real estate?

If owned: When did you purchase the property? How much did the property cost?  What are the mortgages encumbering it?  What do you estimate the present value of the property to be?  Is that the whole value or your share?  How did you arrive at that value?

If renting:  Have you ever owned the property in which you live and/or is its owner in any way related to you?

2.    Have you made any transfers of any property or given any property away within the last one year period (or such longer period as applicable under state law)?

If yes:  What did you transfer?  To whom was it transferred?  What did you receive in exchange?  What did you do with the funds?

3.    Does anyone hold property belonging to you?

If yes:  Who holds the property and what is it? What is its value?

4.    Do you have a claim against anyone or any business?

If there are large medical debts, are the medical bills from injury?
Are you the plaintiff in any lawsuit?
What is the status of each case and who is representing you?

5.    Are you entitled to life insurance proceeds or an inheritance as a result of someone’s death?

If yes:  Please explain the details.

If you become a beneficiary of anyone’s estate within six months of the date your bankruptcy petition was filed, the trustee must be advised within ten days through your counsel of the nature and extent of the property you will receive.  FRBP 1007(h)

6.    Does anyone owe you money?

If yes:  Is the money collectible?  Why haven’t you collected it? Who owes the money and where are they?

7.    Have you made any large payments, over $600, to anyone in the past year?

8.        Were federal income tax returns filed on a timely basis?  When was the last return filed? Do you have copies of the federal income tax returns?  At the time of the filing of your petition, were you entitled to a tax refund from the federal or state government?

If yes:  Inquire as to amounts.

9.    Do you have a bank account, either checking or savings?

If yes:  In what banks and what were the balances as of the date you filed your petition?

10.    When you filed your petition, did you have:

a.    any cash on hand?
b.    any U.S. Savings Bonds?
c.    any other stocks or bonds?
d.    any Certificates of Deposit?
e.    a safe deposit box in your name or in anyone else’s name?

11.    Do you own an automobile?

If yes:  What is the year, make, and value?  Do you owe any money on it?  Is it insured?

12.    Are you the owner of any cash value life insurance policies?

If yes:  State the name of the company, face amount of the policy, cash surrender value, if any, and the beneficiaries.

13.    Do you have any winning lottery tickets?

14.    Do you anticipate that you might realize any property, cash or otherwise, as a result of a divorce or separation proceeding?

15.    Regarding any consumer debts secured by your property, have you filed the required Statement of Intention with respect to the exemption, retention, or surrender of that secured property?  Please provide a copy of the statement to the trustee.  Have you performed that intention?

16.    Have you been engaged in any business during the last six years?

If yes:  Where and when?  What happened to the assets of the business?

In cases where debtors are engaged in business, the following questions should be considered:

1.    Who was responsible for maintaining financial records?

2.    Which of the following records were maintained?

a.    Cash receipts journal
b.    Cash disbursements journal
c.    General journal
d.    Accounts receivable ledger
e.    Accounts payable ledger
f.    Payroll ledger
g.    Fixed asset ledger
h.    Inventory ledger
i.    General ledger
j.    Balance sheet, income statement, and cash flow statements

3.    Where are each of the foregoing records now located?

4.    Who was responsible for preparing financial statements?

5.    How often were financial statements prepared?

6.    For what periods are financial statements available?

7.    Where are such financial statements now located?

8.    Was the business on a calendar year or a fiscal year?

9.    Were federal income tax returns filed on a timely basis?  When was the last return filed?

10.    Do you have copies of the federal income tax returns?  Who does have the copies?

11.    What outside accountants were employed within the last three years?

12.    Do you have copies of the reports of such accountants?  Who does have copies?

13.    What bank accounts were maintained within the last three years?

14.    Where are the bank statements and canceled checks now located?

15.    What insurance policies were in effect within the last year?  What kind, and why?

16.    From whom can copies of such insurance policies be obtained?

17.    If the business is incorporated, where are the corporate minutes?

18.    Is the debtor owed any outstanding accounts receivable?  From whom?  Are they collectible?

19.    Is there any inventory, property, or equipment remaining?

Source: Executive Office of U.S. Trustee, Handbook for Standing Trustees, July 2002 (With Technical Amendments, effective 1/1/05; updated 341 meeting questions, effective 3/1/06; and Domestic Support Obligations, effective 10/1/08)

There are many differences between Chapter 7 and Chapter 13 bankruptcy. Chapter 7 is much less expensive than Chapter 13. Chapter 7 is much shorter in duration than Chapter 13. But most importantly, these two different types of bankruptcy were designed to deal with different types of debt problems.

Chapter 7 bankruptcy allows a person to wipe out debt and obtain a fresh start in just a few months. Chapter 7 bankruptcy will wipe out unsecured debts such as credit cards, medical bills and payday loans.

Chapter 7 will also allow you to surrender a home or vehicle or other financed purchase and walk away without owing another penny. The entire Chapter 7 process usually takes about 4 months from the time you file until the end of your case.

Chapter 13 bankruptcy is a repayment plan that lasts from 3 to 5 years. Chapter 13 is a form of debt consolidation where you pay back secured debts, usually in full, and pay cents on the dollar on your unsecured debts. Your bankruptcy lawyer creates a Chapter 13 plan which requires you to make a monthly payment to the Chapter 13 Trustee who then pays your different creditors.

A great benefit of Chapter 13 is that it will stop the foreclosure of your home or the repossession of your car and allow you to cure any delinquency and catch up your payments over the length of the Chapter 13 plan.

If you’re struggling with debt problems and would like to know more about the different types of bankruptcy and which would be best for your specific situation, contact me today to schedule a FREE initial consultation. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. I would count it a privilege to be able to visit with you in a relaxed and confidential environment where I’ll answer all of your questions in plain English and give you the straight scoop on the pros and cons of bankruptcy as related to your specific situation.

1. THE CREDIT CARD RUN-UP MISTAKE:

Stop using your credit cards once you have made the decision to file bankruptcy. Credit card charges in excess of $500.00 made within 90 days of filing bankruptcy are presumed to be non-dischargeable which means that you will still owe these debts. Cash advances of more than $750.00 within 70 days of filing are also presumed to be non-dischargeable. Don’t jeopardize your “fresh start” by continuing to use your credit cards.

2. THE REPAY A FAMILY MEMBER MISTAKE:

Let’s say that you owe Mom and Dad or Grandma some money and you also owe the credit card companies a good bit of money and you’ve made the decision to file bankruptcy. However, you have some money that you could use to pay some of your debts. So you decide to pay back your relatives. That’s completely understandable. I mean who wouldn’t choose to pay back family over the credit card companies? However, the bankruptcy laws require you to treat family members just like any other creditor. No special favors are allowed for relatives. If you do pay back a family member within one year of filing bankruptcy, the Trustee assigned to your case can make your relatives cough up the money.

3. THE TRANSFER PROPERTY OUT OF YOUR NAME MISTAKE:

Some people think they can protect property that would otherwise be taken away from them in bankruptcy by just giving it away or selling it real cheap to a relative or close friend. Then after the bankruptcy is over, they’ll get their property back. This particular type of scheming is known as a fraudulent conveyance in bankruptcy, And a bankruptcy trustee has the power to undo a transfer of this kind going back four years before the date you filed bankruptcy.

4. THE LIQUIDATE YOUR RETIREMENT ACCOUNT MISTAKE:

Many good people raid their retirement accounts in an attempt to pay off their debt. Unfortunately, many times these people continue to have debt problems and end up filing bankruptcy. Only now they no longer have their retirement accounts for their golden years. Had they just filed bankrupcy to begin with, they would still have their nest egg as retirement accounts are generally protected in bankruptcy. You can eliminate your debt and still keep whatever you have in an ERISA qualified retirement account.

5. THE LINE OF CREDIT/SECOND MORTGAGE TO PAY DEBT MISTAKE:

The same logic regarding retirement accounts also applies to the equity you have built up in your home. Don’t take ouit a second mortgage or a home equity line of credit (HELOC) in order to pay off unsecured debt. If you do, you’re not really getting out of debt, you’re just moving the debt around. Yes you may have paid off your credit cards but the debt is still there and now your house is at risk. You’ve gone and turned general unsecured debt into debt secured by your home. And if something bad happens and you’re unable to pay this new debt, you could very likely end up losing your home. Not a smart move but well-intentioned people do it every day.

6. THE FAILURE TO APPEAR AT COURT MISTAKE:

If a creditor or bill collector sues you and you either must file a written response or appear at a court hearing, make sure you do what you are supposed to do. Otherwise, the person who sued you will win by default and then they can do things like garnish your paycheck or file liens on your property. Of course filing bankruptcy will stop all of this collection activity, but the bankrutpcy must be filed prior to your deadline for answering the lawsuit or your court hearing. Collection activity and lawsuits don’t stop just because you decide to file bankruptcy. You must actually get your bankruptcy case filed before you’ll be protected from collection activity.

7. THE FAILURE TO TELL YOUR ATTORNEY THE TRUTH, THE WHOLE TRUTH AND NOTHING BUT THE TRUTH MISTAKE:

If you want your lawyer to be able to really protect you and your property from your creditors and bill collectors, you must tell your lawyer everything there is to know about your financial situation. This includes being truthful and not holding back regarding everything you own. If you fudge the facts and aren’t completely open and honest with you lawyer, it’s impossible for your lawyer to represent you effectively. And the end result is that you could very likely lose the stuff you were trying to protect. Or worse yet , you could lose your stuff and have your bankruptcy case dismissed and be sanctioned with monetary fines and imprisonment. The penalties for fraud and dishonesty in bankruptcy are quiet severe these days.

If you’re struggling with debt problems and would like to know more about how bankruptcy may be able to help you, contact me today to schedule a FREE initial consultation. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. I would count it a privilege to be able to visit with you in a relaxed and confidential environment where I’ll answer all of your questions in plain English and give you the straight scoop on the pros and cons of bankruptcy as related to your specific situation.

Source: Kansas Bankruptcy Law Information.

Many people are under the misapprehension that they will lose all of their property if they file bankruptcy. That simply is not true. One of the core principles of bankruptcy law is to give a fresh start to good people who are unable to pay their debts. And if a person is going to come out of bankruptcy with a legitimate fresh start, he needs to come out with more than just the shirt on his back.

Therefore, a person filing bankruptcy (the debtor) is allowed to keep certain property that he owns outright. These possessions are known as exempt property. And exactly what property a person is allowed to keep or exempt varies from state to state. Here is the specific list of property that is exempt under Oklahoma law.

Any property that a person owns that is not specifically listed as exempt property is subject to being taken by the Chapter 7 trustee, sold at auction, and the proceeds paid to the debtor’s unsecured creditors. This is the trade-off in Chapter 7 bankruptcy. The debtor willingly gives up non-exempt property in exchange for having certain debts discharged (forgiven, canceled or wiped-out). The good news is that the vast majority of people who file Chapter 7 bankruptcy do not own any non-exempt property.

I have tried to offer a simple explanation of this issue of exempt versus non-exempt property. However, the truth is that the law of bankruptcy exemptions is not a simple matter.

First, a debtor must be knowledgeable about the applicable exemption laws before he actually files bankruptcy or risk the possibility of losing property that is valuable and/or sentimental. Second, a person filing bankruptcy is not just automatically allowed to keep exempt property. He must first declare what property of his he is claiming as exempt and then must refer to the specific law that grants the exemption.

As with all things bankruptcy, you would be wise to discuss your specific situation with a knowledgeable bankruptcy lawyer.

If you’re struggling with debt problems and would like to know more about how bankruptcy may be able to help you, contact me today to schedule a FREE initial consultation. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. I would count it a privilege to be able to visit with you in a relaxed and confidential environment where I’ll answer all of your questions in plain English and give you the straight scoop on the pros and cons of bankruptcy as related to your specific situation.

The new bankruptcy law of 2005 (BAPCPA) requires that everyone filing Chapter 7 or Chapter 13 bankruptcy must complete a Credit Counseling class AND a Personal Financial Management/Debtor Education class. Why two different classes? Well, the Credit Counseling class focuses on your existing debts whereas the Personal Financial Management class attempts to teach you how to budget and responsibly manage your finances for the future.

The Credit Counseling class must be taken before you file bankruptcy while the Personal Financial Management class is taken after you file bankruptcy. Even though taken at different times, you may take both classes from the same provider. Just make sure that the provider is a non-profit budget and credit counseling agency that has been approved by the Department of Justice’s United States Trustee Program.

Upon completion of each class, you will receive a Certificate of Completion. You must provide proof of course completion to the bankruptcy court in order to avoid dire consequences.

If you fail to provide the bankruptcy court with a copy of your Credit Counseling Certificate of Completion, your newly filed bankruptcy case will be summarily dismissed. You can always refile, but that costs more money and wastes time.

Worse yet is what happens if you fail to provide proof that you completed the Personal Financial Management class. Then your bankruptcy case being closed without a discharge order being issued to you. This would be terrible because the discharge order is why you filed bankruptcy to begin with. It’s the discharge order that releases you from personal liability for certain types of debts. In other words, obtaining a discharge means that you are no longer legally required to pay the debts that are discharged. Therefore, your creditors can no longer take any action against you to collect those debts. No letters. No phone calls. No lawsuits. No garnishments. But, if you do not receive a discharge because you failed to provide proof of having completed the Personal Financial Management class, you will still owe each and every one of your debts. And believe you me, your creditors will come back after you with a vengeance.

So in conclusion, be sure to take the two required classes at the right time and then follow up by providing proof to the court that you completed both courses. A service that I offer to my clients is assistance in both scheduling these two classes and providing the appropriate notification to the court.

If you’re struggling with debt problems and would like to know more about how bankruptcy may be able to help you, contact me today to schedule a FREE initial consultation. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. I would count it a privilege to be able to visit with you in a relaxed and confidential environment where I’ll answer all of your questions in plain English and give you the straight scoop on the pros and cons of bankruptcy as related to your specific situation.

If you’re thinking about filing bankruptcy, make sure that you consider the following 15 items before you actually file your case. While I’m sure that your debt problems have you stressed out, you don’t want to jump out of the frying pan and into the fire! The new bankruptcy law of 2005 has made bankruptcy an even more complex process than it was before. So slow down and take some time to ensure that your bankruptcy case goes as smoothly as possible and that you don’t wind up in worse shape than you are now.

1.  Educate yourself about bankruptcy. Read the different articles on this blog and search the internet for other reputable sources of bankruptcy information.

2.  Explore non-bankruptcy alternatives.

3.  Don’t withdraw money from your retirement accounts to pay your debts. Money in 401(k)s, IRAs and other retirement accounts is generally protected from your creditors when you file bankruptcy. So you’d be using money that you could have kept to pay debts that would have been discharged (forgiven or wiped out) by your bankruptcy.

4.  Get your credit report. Here’s how to do it for free.

5.  Make a list of everyone you owe money. Your attorney will need this information to prepare your bankruptcy documents.

6.  Get your paperwork together. Bankruptcy requires a ton of paperwork. Here’s a partial list of what you should be prepared to provide to your attorney:

• 60 days’ worth of pay stubs (you eventually may need to provide more to prove your income for the six months prior to filing).
• The last two months of bank statements.
• Tax returns for the previous two years.

• Statements for all brokerage and retirement accounts, including IRAs, Roth IRAs and 401(k)s.

• Your most recent bills.

• Any collection letters you’ve received or other correspondence about your debts.

• Any current loan contracts (for homes, cars, etc.).

• Any lease contracts (for apartments, cars, etc.).

• Any home appraisals or tax assessments related to your home or other real estate you own.

• Any paperwork related to past bankruptcies.

• Any legal papers you’ve received, including but not limited to lawsuits, judgments, wage garnishments, divorce decrees, court orders and child-support orders.

• Proof of your identity, such as a driver’s license and Social Security card.

7.  Talk with an experienced bankruptcy lawyer. While you can file for bankruptcy without a lawyer, the process is complicated, and I don’t recommend it. You can find a good bankruptcy lawyer at the web site for the National Association of Consumer Bankruptcy Attorneys.

8.  Don’t delay once you’ve made the decision to file bankruptcy. Many people keep throwing good money after bad as they continue to struggle with bills they can’t pay and dig themselves a deeper and deeper financial hole. Sometimes they put off filing until they end up getting sued and having their paycheck garnished. Once you decide bankruptcy is the right choice for you, take action. Get your attorney the paperwork he or she needs and follow through on the other steps required to keep the process moving.

9.  Stop paying bills that will be discharged or forgiven by the bankruptcy. Talk with your bankruptcy lawyer about this first but typically it makes little sense to continue paying debts that will be discharged (forgiven or wiped out) in bankruptcy, such as credit cards, medical bills and payday loans. You’re sort of throwing your money away. If you’re giving up a house or a car, you may want to stop paying those bills too. But again, talk with your attorney first and ask how best to handle your creditors.

10.  Start saving money to pay your lawyer’s fee and other bankruptcy costs. Bankruptcy isn’t cheap. A Chapter 7 bankruptcy typically costs $1,500 or more, including court costs and your attorney’s fee, and a Chapter 13 bankruptcy will cost about twice as much. It will help if you stop paying some bills like we talked about in Step 9.

11.  Stop using your credit cards. As soon as you know you’re going to file bankruptcy, stop using your credit cards. Even better, cut them up. If you use a credit card within 90 days of filing bankruptcy, you’ll still owe the credit card company that money. And using a credit card that  you don’t intend to pay back could be considered bankruptcy fraud.

12.  Think about opening new bank accounts. Do you owe money to a bank or credit union? If so, I recommend that you consider withdrawing any money you have there and move it to a bank or credit union to whom you don’t owe anything. Otherwise, once notified of your bankruptcy, your bank or credit union may try to seize the money you have on deposit.

13.  Don’t buy any big-ticket items without talking to your lawyer. Once you know you’re going to file, you shouldn’t make a financial move without consulting your attorney.

14.  Don’t give away and of your money or other property. Selling or giving away your property before filing bankruptcy can cause you problems in your bankruptcy. The same with paying back money you owe to friends or relatives. Even if you’re trying to do the right thing, these actions could be considered a preferential transfer or fraudulent conveyance, both of which are bad things in bankruptcy.

15.  Complete the required pre-filing credit counseling course. Before you can file bankruptcy, you must complete a one-hour credit counseling course with an agency approved by the U.S. Department of Justice. If you hire me as your bankruptcy lawyer, I’ll help you make arrangements to take the course  The course costs about $50 and can be taken on the internet or by telephone. Make sure you get a certificate showing you’ve completed the course, as it will be required for your bankruptcy filing.

If you’re struggling with debt problems and would like to know more about how bankruptcy may be able to help you, contact me today to schedule a FREE initial consultation. Just fill out the Contact Dan form on the far right side of the page and click the Submit button and I’ll get back with you as quickly as I can. I would count it a privilege to be able to visit with you in a relaxed and confidential environment where I’ll answer all of your questions in plain English and give you the straight scoop on the pros and cons of bankruptcy as related to your specific situation.

Source: MSN Money.

Well we’ve made it to video #8, the final video in an excellent video series produced by the Administrative Office of the United States Courts that provides general information on the bankruptcy process. I hope that you’ve watched all of the videos in this series and have learned a good deal about the bankruptcy process.

If you are struggling with debt problems and would like to know more about how bankruptcy may be able to help you, contact me today by completing the Contact Dan form on the far right side of this page to schedule a FREE initial consultation. I would count it a privilege to be able to visit with you in a relaxed and confidential environment where I’ll answer all of your questions in plain English and give you the straight scoop on the pros and cons of bankruptcy as related to your specific situation.

We are quickly approaching the end of this video series on the Basics of Bankruptcy which was produced by the Administrative Office of the United States Courts and provides excellent general information on the bankruptcy process. Today’s video is the seventh and next-to-last video in this series. I hope you’ll come back tomorrow for the final video.

If you are struggling with debt problems and would like to know more about how bankruptcy may be able to help you, contact me today by completing the Contact Dan form on the far right side of this page to schedule a FREE initial consultation. I would count it a privilege to be able to visit with you in a relaxed and confidential environment where I’ll answer all of your questions in plain English and give you the straight scoop on the pros and cons of bankruptcy as related to your specific situation.