Emergency Bankruptcy

Emergency bankruptcy filings cater to people who don't have the time available to wait for a standard filing to be processed when they are faced with the imminent threat of foreclosure or dispossession. After all, a part of the process involves filling out the forms to ensure that assets are property exempted, and that all the creditors are listed correctly to ensure that they receive their notices. Furthermore, a Means Test must be completed and calculated to ensure that you are eligible for the chosen bankruptcy filing. Bankruptcy paperwork takes time, but an emergency petition allows you to submit the petition immediately and set the automatic stay process in motion. You can then complete and file the rest of the paperwork later.

If you are overburdened by financial stress due to debts you are unable to service, and when threatening calls from obnoxious debt collectors are keeping you awake at night, it may be time to consider bankruptcy. Federal and some aspects of state law govern Chapter 7 and Chapter 13 bankruptcy, under the US Bankruptcy Code. Part of the process involves payment plans that enable you to repay a smaller amount, while some cases involve discarding the majority of debts. A professional San Diego Bankruptcy Attorney can guide you through the process and help you obtain comprehensive debt relief while:

  • Putting a stop to creditor harassment
  • Preventing foreclosure
  • Preventing wage garnishment
  • Preventing repossession
  • Discharging credit card debt
  • Working towards a fresh start.

A standard bankruptcy is a lengthy process, which goes through multiple phases, starting with debt counseling. This provides an opportunity to get a good handle on how you spend your money and who your creditors are. You also develop a firm grasp of your assets and liabilities during this process. During this time, you learn exactly where you stand financially and as such, you have the latest copies of all the required financial statements. It is all prepared and ready for when you enter bankruptcy.

However, when you request an emergency bankruptcy filing, you may not have gone through debt counseling. You may not have all the supporting documents and statements at your disposal, and no time to get it in a hurry. Unless you're properly prepared, you may not have the documents you need, and knowing that it sometimes takes time to obtain and file the documents, an emergency bankruptcy or skeletal filing can buy you some leeway.

The average bankruptcy filing can contain between 50-70 pages of documentation that lists all your income, expenses, debts, assets and detailed statements that expose your financial history. If you don't have time to compile all the documentation in the required time frame, emergency bankruptcy may provide an alternative to traditional bankruptcy filing.

Ideally, it is best to avoid waiting until the last minute to discuss your case with an experienced bankruptcy attorney. Most bankruptcy attorneys will recommend that you file a standard bankruptcy petition and try to avoid an emergency bankruptcy, but there are times when the latter makes sense.

Filing for bankruptcy is a paper-intensive process. You have to accurately, honestly and fully disclose your income, expenses, debts, assets and other financial information. When you file the petition, it triggers a series of next steps. When you're under pressure for time, it is easy to make mistakes that can cause problems later on, including a denial of the bankruptcy discharge or even dismissal of the case. You may even face criminal penalties if the court deems that you intentionally evaded the truth or lied in your documentation and statements.

However, you may sometimes be left with no choice other than to file an emergency petition, especially if you are trying to avoid:

  • Lawsuits
  • Car repossessions
  • Eviction
  • Foreclosure on your home
  • Garnishments.

An emergency bankruptcy petition provides the protection of an automatic stay, but it also gives you a little more time to compile all your documentation. However, as the debtor, it is important to understand that the actual process of submitting the balance of the documentation takes time. It is crucial that you still secure all the copies of the documents and submit it to your bankruptcy attorney right away to ensure that the process stays on track.

If a case is dismissed after failure to file all the paperwork within 15 days, it will be much more complicated to refile later on. There are limitations on the amount of time the automatic stay of bankruptcy remains in effect. For it to remain in force, you must file a motion and you must appear before a judge where you will have the opportunity to argue that the circumstances have changed, giving good cause to keep the automatic stay in tact.

Without putting forth the effort to ensure that all the relevant paperwork is filed, it is much more difficult to keep a stay in effect. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) offer consumers very little protection, as it contains provisions to guard against the abuse of bankruptcy law. The law views multiple bankruptcy filings by the same individual as abusive as it is perceived as a way to frustrate creditors' efforts.

A three-strike rule has been put into effect by the Bankruptcy Court to prevent people from playing the system in order to invoke automatic stays and prevent foreclosure or other legal actions against them. The full automatic stay will be in effect for the duration of your first filing. If you file a second case within a year of the initial petition, you will only receive a 30-day automatic stay. That means that you must file the Motion to Extend of Continue the Automatic Stay on the same day that you file your emergency petition. The motion can help to ensure that your protection stays in effect throughout the case. There is no automatic stay on a third emergency bankruptcy filing within a year of the second filing. That means that all legal actions against you are allowed.

You will have to file a Motion to Impose the Automatic Stay in order to protect your assets. Along with this motion, you will have to provide valid reasons for filing a repeat case, proving that you don't mean any bad faith with the subsequent filings. However, if the judge feels that the last filing is a means to hinder your creditors from taking collection activity and you have no intention to complete the bankruptcy proceedings, your automatic stay will be denied. Depending on the severity of the case, the judge may deny the discharge of debts.

Reasons for a Skeletal or Emergency Bankruptcy

The automatic stay that is initiated as soon as a skeletal bankruptcy is filed. This stay prevents creditors from taking again against you, including garnishing your wages and foreclosing on your home. In many cases, people who file an emergency bankruptcy have tried unsuccessfully to clear up their finances for years, and have reached a point where bankruptcy is the only option. Emergency filings are typically completed when creditor actions are imminent.

Emergency Bankruptcy Petition: The Basic Requirements

In order to start your emergency bankruptcy petition (also known as a skeleton petition) and get an automatic stay, you must submit the following documents:

  • Form B-1 bankruptcy form. This constitutes the initial three pages of your emergency bankruptcy petition.
  • Creditor Matrix. The creditor matrix is a list of all your known creditors and their contact details. Courts sometimes allow debtors to allow the credit matrix a few days after the petition.
  • Statement of Social Security Number (Form B-21).
  • Certificate of Credit Counseling. In the case of an emergency bankruptcy, you may not have received credit counseling. If you have not received credit counseling, you need to file a motion explaining the exigent circumstances that prevented you from participating in consumer credit counseling, and another motion to exempt you from the requirement.
  • Personal Information, including:
    • Full names, and any other names used within the last six years, including trade names, maiden names and married names.
    • Full residential address.
  • In prior cases, if you filed for bankruptcy in the last eight years, you must provide:
    • Case number
    • Filing date
    • The district in which the case was filed
  • Related cases, if a partner, spouse or affiliate filed for bankruptcy in the last 2 years, you must supply:
    • Name of the person / entity who filed for bankruptcy
    • Case number
    • Filing date
    • The district in which the case was filed
  • Credit Report Authorization
  • Notice of Default for foreclosure.
  • Notice of Sale, which sets a trustee sale date.

To qualify for a Chapter 13 bankruptcy, you may also have to file a pay order which provides estimated plan payments to the Chapter 13 trustee. Depending on the court, there may be additional requirements, including disclosure statements or electronic copies of your documentation.

Some courts will require that you file a cover sheet as well as an Order Dismissing Chapter 7 Case. According to Bankruptcy Rule 1007 (c), a Chapter 7 will be processed unless you file the balance of your documentation within fourteen days.

With an emergency bankruptcy petition, court clerks may not be able to submit notices to creditors on time to prevent impending collection actions. However, you can immediately submit notice of the filing directly to those creditors that are implementing collection actions.

A filing fee is due when you file a skeleton petition:

  • Chapter 7 - $335
  • Chapter 13 - $310

If you are unable to pay the fee, you may request to pay the fee in installments, by filing an Application to Pay Filing Fee in Installments. Applicants who believe that they are exempt from paying the fee must file the Application to Waive Filing Fee form.

Once the initial skeleton emergency bankruptcy documentation has been filed, you have 14 days to file the rest of the paperwork, including financial documents, statements and schedules. Without these documents, your case will be dismissed and you will have to file again.

Emergency Bankruptcy: Next Steps

Once your emergency bankruptcy petition has been filed, the court will draft and file the "Notice of Incomplete Filing" or "Filing of Outdated Forms and Notice of Intent to Dismiss Case if Documents Are Not Timely Filed". The document will contain a list of all the documents that must be filed within 14 days of your emergency petition. Unless an extension is granted, failure to file the documents contained, the Clerk of the Court will automatically dismiss your case.

Depending on the specific court, the additional documents that need to be filed may include:

  • Attorney's Statement of Disclosure
  • Form 1122A-1 - Monthly Income Statement
  • Schedule A/B - Real and Personal Property
  • Schedule C - Exempt Property
  • Schedule D - Secured Creditors
  • Schedule E/F - Unsecured Creditors
  • Schedule G - Executory Contracts
  • Schedule H - Codebtors
  • Schedule I - Current Income
  • Schedule J - Current Expenditures
  • Summary of Assets and Liabilities
  • Statement of Financial Affairs

In the case of a Chapter 13 bankruptcy, you will have to file a Chapter 13 Plan too.

Help with Emergency Bankruptcy Petition Filing

Are you in a financial bind and you don't see a way out of it? Have you tried to make headway, but the pressures of repaying debt and providing for your family have become too much? Perhaps you have been working through debt counseling, but you need a more comprehensive form of debt relief. If you need a break from harassing calls from your creditors demanding payment, or you need to save your house or car from being repossessed, an emergency bankruptcy filing may provide the relief you need, provided you intend to follow through with the complete filing.

Call 619-488-6168 today to schedule an appointment with a highly experienced San Diego Bankruptcy Attorney. During your initial consultation, the attorney will perform a high level case review and advise on the legal remedies that are available to you. The attorney will also inform you about the documentation you will need to proceed with your emergency bankruptcy and the Chapter 7 or Chapter 13 bankruptcy to follow.

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