Filing for bankruptcy is never a simple decision you take lightly. If you’ve determined bankruptcy is the right choice for you, your next step is to gather all the necessary documentation and find out if you’re eligible for chapter 7 or chapter 13 bankruptcy.
Whether your bankruptcy involves liquidating your assets or creating a repayment plan, you’ll need to gather the same documentation. An attorney can help you with filing paperwork and determine what course is best for you. To make the most of your time, make sure you bring all necessary documentation with you.
Your financial records will help you determine whether to file for chapter 7 or chapter 13 bankruptcy. In chapter 7 bankruptcy, your assets may be sold to pay your creditors. Chapter 13 bankruptcy allows you to create a plan to pay back your debt over a number of years.
You’ll need income documentation for the 6 months leading up to the bankruptcy. This may include:
- Pay stubs for the past 6 months
- Your 2 most recent W-2 forms
- Profit and loss statements for the past 6 months (if you’re self-employed)
- Documentation for any other forms of income: social security, disability, alimony, child support, rental income, and other investments
If you own real estate, you’ll need to provide documentation to show how much the property is worth and any related expenses. Your checklist should include:
- Mortgage statements
- Current loan balance
- Deeds of trust
- Proof of home insurance
- Documentation for property value: an online valuation, broker’s opinion, or a full appraisal if necessary
Your vehicle and any associated expenses are taken into consideration. Necessary documents include:
- Proof of registration
- Proof of insurance
- Car loan statement showing how much you owe and your monthly payment
- The value of the car. (You can get an estimate online.)
Finally, you’ll need to include information regarding your retirement and other bank accounts. This is as simple as providing your most recent bank statements.
Your legal history is another important factor in determining your eligibility for chapter 7 or chapter 13 bankruptcy. This information helps the court determine how much you can afford to pay your current debtors. This documentation might include:
- Debts from previous judgments
- Any previous litigation
- Pending litigation
You’ll also need to provide documentation from divorce proceedings, including:
- Child support and alimony
- Proof of expenses: the court order is probably the easiest way to prove this.
Once you’ve gathered your financial and legal records, take the time to consider if any other information will be important for your case. This can include:
- All correspondence with creditors
- All insurance policies
- Promissory notes
- Any proof that someone owes you money
- Canceled checks for expenses you can’t document any other way
- Any assets not already accounted for
Establishing Your Monthly Living Expenses
The court will take your monthly expenses into account. Calculate utilities, food, gas, and other bills related to daily living. You won’t need to provide receipts or documents for this but an estimated listing expenses will be necessary.
The Final Checklist
Of course, you’ll also need to provide a valid photo ID and proof of your social security number.
One last item required for bankruptcy is a certificate proving you’re taking a credit counseling class. These classes are available online and most can be completed in an hour.
Filing for bankruptcy is always a stressful situation with a lot of complicated emotions. An attorney can provide the counsel you need to determine which bankruptcy path is right for you and your financial future. If you’re considering bankruptcy, contact us today to discuss your options.