Filing for Bankruptcy: What to Expect in Massachusetts

Filing for bankruptcy is a significant decision that can provide relief in difficult financial situations. If you're considering bankruptcy in Massachusetts, it's essential to understand what the process entails and what to expect. This article outlines the key steps involved in filing for bankruptcy in the Bay State.

In Massachusetts, individuals typically file for bankruptcy under Chapter 7 or Chapter 13. Chapter 7 bankruptcy allows for the discharge of most unsecured debts, such as credit card bills and medical expenses, while Chapter 13 involves creating a repayment plan to pay back all or part of your debts over a three to five-year period.

Understanding the Process of Filing for Bankruptcy

The first step in filing for bankruptcy is to take a thorough inventory of your financial situation. This includes listing all your debts, assets, income, and expenses. You will also need to complete a credit counseling course from an approved provider, which is mandatory before you can file for bankruptcy.

Once you have completed your credit counseling, the next step is to gather all the necessary documentation, including tax returns, bank statements, and pay stubs. This information will support your bankruptcy petition.

Filing Your Bankruptcy Petition

You can file your bankruptcy petition either online or in person at your local bankruptcy court. In Massachusetts, the process generally involves filling out the required forms, detailing your financial situation, and filing them with the court along with the appropriate filing fee. As of now, the filing fee for Chapter 7 bankruptcy is $338, while it is $313 for Chapter 13. However, there is a possibility for fee waivers based on your income level.

After filing the petition, the court will appoint a trustee to oversee your case. The trustee will review your financial documents and handle any asset liquidation (for Chapter 7) or repayment plans (for Chapter 13).

The Meeting of Creditors

One of the critical milestones in the bankruptcy process is the Meeting of Creditors, also known as the 341 meeting. This meeting typically occurs about a month after you file your bankruptcy petition. During this meeting, creditors have the opportunity to ask questions about your financial situation and the bankruptcy process. It's essential to attend this meeting and answer any questions honestly.

What Happens Next?

If you filed for Chapter 7 bankruptcy, you can expect that your unsecured debts will be discharged within a few months if everything goes smoothly. However, if you opted for Chapter 13, you will start making monthly payments according to the repayment plan approved by the court.

It's important to be aware that bankruptcy can have a significant impact on your credit score. Although the bankruptcy will stay on your credit report for up to 10 years, many individuals find that with responsible financial behaviors post-bankruptcy, they can gradually rebuild their credit.

Conclusion

Filing for bankruptcy can be a complex process, but understanding what to expect can help alleviate some of the stress involved. In Massachusetts, knowing the types of bankruptcy available, the required documentation, and the steps in the process will empower you to make informed decisions about your financial future. Make sure to consult with a qualified bankruptcy attorney to guide you through the process and help safeguard your interests.