Filing for bankruptcy provides a person in financial trouble with a fresh start. If you are having trouble paying bills and have been unable to make ends meet despite your best efforts, filing for bankruptcy may be an option for you.

There are different bankruptcy chapters to choose from, but most people file for Chapter 7. If your situation fits into Chapter 7, you should be able to discharge all of your unsecured debts, such as credit card and medical bills. Secured collateral, such as a home and vehicle, may be kept as long as those loans are current.

In Chapter 13 bankruptcy, a repayment plan is filed with the bankruptcy court that allows you to pay off your debts over a three- to five-year time frame. The amount you will have to repay depends on how much you earn, the amount and types of debt you owe, and how much property you own. Chapter 13 bankruptcy is particularly useful in ensuring that you keep your home, even if your lender has already begun foreclosure proceedings.

In a nutshell, all of your debts and assets are listed on documents called schedules. Those schedules are filed with your petition in federal bankruptcy court. Once filed, your case is assigned to a bankruptcy trustee who reviews the information in your case. You will be asked to come before the trustee at the meeting of creditors for your case, which is scheduled approximately one month after your case is filed.

If you live in the Southern District of Iowa, the meeting of creditors is held in Des Moines. One of our attorneys will accompany you at the meeting. It lasts between 5 and 10 minutes and consists of the trustee asking you questions about your financial situation and the papers filed in your case. It is called a meeting of creditors because all of your creditors are invited to come and ask you questions. However, most do not appear at the meeting.

If all goes smoothly, you will receive a discharge in the mail approximately 8 weeks after the meeting of creditors in a Chapter 7 bankruptcy case. The discharge usually ends your involvement in the case. In a Chapter 13 bankruptcy case, a discharge is not entered until the end of your three- to five-year repayment plan, but no creditors can contact you while your Chapter 13 plan is in effect.

Chapter 7 bankruptcy costs $338 to file in court, and the attorney legal fee is typically another $1100 for single filers and $1,200 for married couples filing jointly. Chapter 13 bankruptcy costs $313 to file in court, and the attorney legal fee is approved by the court and charged on an hourly basis. Our office does charge an additional $200 for cases filed in the Northern District of Iowa due to increased travel time. We reserve the right to increase charges for people with businesses.

The above-stated fees are available only to clients whose matters encompass the services described in our retainer agreement. If the matters are not so encompassed, or if an hourly rate is necessary, then you are entitled, without obligation, to a specific written estimate of the fees likely to be charged.

In addition, under the new bankruptcy law, you will be required to take a pre-bankruptcy filing class and a post-filing financial management class. Each of these classes typically cost $30 to $50, depending on the provider.

If you are interested in learning more about bankruptcy, make an appointment with one of our attorneys. The first consultation is FREE, and your situation will be examined to determine if bankruptcy is an option for you.