Free Consultation

Call us right now. Or let us Call You!

(317) 769-2244
Fields marked with an * are required

Parties Involved When Someone Files for Bankruptcy

The question comes frequently to our office – who is involved when someone files for bankruptcy?  In reality, less parties are usually involved than most people think.   Let’s discuss who is involved when someone files for bankruptcy.

The Debtor

The debtor is the primary person (or persons) involved when filing for bankruptcy. The debtor is the person or company who needs their debts relieved.   Usually the debtor files a bankruptcy petition asking the court for bankruptcy relief.  Debtors range from a single filer, to a married couple, all the way to the largest corporations in America.

The Case Trustee

The Case Trustee (or Interim Trustee) is the person in charge of your Chapter 7 or Chapter 13 case.  The trustee makes sure that your case is handled correctly, making sure that all bankruptcy rules are followed. The Trustee is also responsible for your property during the bankruptcy case, making sure that all property (or income) that should go to your creditors is properly turned over to repay your debts.

The Bankruptcy Court and Judge

You are always assigned a bankruptcy Judge during your bankruptcy case.  However, most cases never come up in front of the Judge because there are not disputes in most bankruptcy cases.   The Bankruptcy Court is the forum and mechanism in which you file your case.  The bankruptcy court’s clerk office is responsible for receiving your bankruptcy petition request and managing the basic administrative functions of your bankruptcy case.

The United States Trustee

The United States Trustee is the “sheriff in town” during the bankruptcy process. This party makes sure that all bankruptcy rules are being followed and that no bankruptcy fraud is occurring.  This office is also required to randomly “audit” a certain amount of bankruptcy cases each year just to make sure that the system is being properly followed through a “spot checks.”  Their direct involvement is not common on most bankruptcy cases.  The United States Trustee also takes a more active role in larger Chapter 7 and Chapter 11 bankruptcy business cases.

The Creditors

The other major party – perhaps the most important in some ways – are the creditors.  All creditors of the debtor are notified when a bankruptcy is filed. The creditors are allowed to make objections in very limited situations.  All creditors must file a proof of their claim if they want to be paid by any amounts collected during the bankruptcy process.  However, in most Chapter 7 cases, the creditors can do very little during the process.  In the majority of Chapter 7 cases, the creditors do very little except just receive their bankruptcy notice and then write-off or cancel their debt when they receive the Chapter 7 discharge notice.

Photo of judge with gavel, Parties in bankruptcy

Indianapolis Bankruptcy Payment Plans

Bymaster Bankruptcy Law Offices offers payments plans

Our office, like some other Indianapolis bankruptcy offices, offers payment plans.  Essentially, we try to work with everybody to help them get out of debt.  If you are considering bankruptcy around Indianapolis, you may want to know a few things about bankruptcy payment plans.

Bankruptcy Payment Plans for Indianapolis Chapter 7 Cases

If you want to file Chapter 7 bankruptcy near Indianapolis, you may especially be in need of a payment plan.   First, the range of what Chapter 7 costs varies somewhat between office to office.  Although many offices offer payment plans of various types, it may be important for you to chose an attorney on the more affordable end of the spectrum.   This could cut your payment time down dramatically.   Remember that some attorneys charge as much as $1500, $1800, or even $2000 or more just for Chapter 7 bankruptcy attorney fees.  This amount may not include the $335 court cost.  Generally, if you find someone less than $1000-$1200 on the attorney fee range (not including the $335 court cost), you are most likely choosing an Indianapolis bankruptcy attorney on the more affordable end of the spectrum.

Secondly, and Indianapolis bankruptcy payment plans can greatly assist because you are generally required to pay all the fees for Chapter 7 before you file your case.  This can put you into a difficult position if you need to file immediately due to a garnishment or other emergency situation.   We usually attempt to work with everybody to the best of our ability to get their case filed quickly.  An affordable office will understand you are limited on financial ability at the moment: that is why you are filing for bankruptcy.   Our clients’ payment plans usually range between $50 to $250 per month (or sometimes greater if they want to go faster).  An affordable office will work with your budget to help you get out of debt.

Bankruptcy Payment Plans for Indianapolis Chapter 13 Cases

Payment plans may not always be necessary for Chapter 13 cases because the Chapter 13 itself is a payment plan.  Therefore, you are allowed to also pay your attorney’s bankruptcy fees through the Chapter 13 case.   The amount that you are required to pay in your Chapter 13 monthly payment will be determined by your income and how much debt you want to pay through the plan.   A good focus on Chapter 13 is how much you will be required to pay before the bankruptcy case is filed.  You are usually always required to pay at least the $310 court cost.  Some attorneys will also charge somewhere between a $100 to $2000 down (or more) before they will file the Chapter 13 case.  Our office attempts to offer $0 down filing on Chapter 13 whenever possible: only in limited situations are we not able to offer $0 down on the attorney fees to file the Chapter 13 case.

Conclusion: A Good Payments Plan can be Critical for Allowing You To File Bankruptcy

Whether Chapter 7 or Chapter 13, a good payment plan can be an essential element for getting enough money together to file for bankruptcy.  In Indianapolis, anticipating a payment plan can be an important step as you consider bankruptcy.  We are an office that has worked with thousands of Hoosiers to get their bankruptcy case filed through a payment plan.  If you give us a call, we will do our best to work with your budget to make a payment plan that works for you.

The difference between secured and unsecured debt?

unsecureddebt_1

We have a lot of Indianapolis Bankruptcy clients come in for a free consultation and wonder what is the difference between secured and unsecured debt.  The difference between the types of debt can be confusing.  Many times I explain that there are two types of debt:  secured debt and unsecured debt.

First, let’s discuss secured debt.  When you have a secured debt, an item is tied to it and pledged as collateral.  A lien is put on the asset which gives the lender the right to take away the asset if you are behind on making the payments.  An example of when you would have secured debt is a mortgage.  When you have a mortgage it is secured by your house, and the lender puts a lien on the home.  If you become delinquent on the payments or stop paying the monthly payments, then the lender will foreclose on the home.  Another example is if you get a loan to purchase a car.  The car is the item that is tied to the loan and it is pledged as collateral.  If you fall behind on your monthly payments, then the lender can repossess the car.

Unlike secured debt, unsecured debts are not tied to collateral.  This means that the lender does not have the right to any collateral for the debt.  If you fall behind on payments, the lender cannot take any of your assets – at least according to the loan agreement you have made.

With unsecured debts, the lenders still have other actions they can use to get you to pay.  Many times they hire a debt collector to get you to pay.  If that doesn’t work, many times they will sue you and ask the court to garnish your wages, take an asset, or put a lien on your house until you have paid back the debt.  Many times the delinquent status is reported to credit bureaus, making the default show up on your credit report.

There are many unsecured debts.  The most common is credit card debt.  Other unsecured debts include medical bills, student loans, and payday loans.

If you are struggling with your secured debt or unsecured debt, our office can help.  Whether the solution is debt settlement, an Indiana Chapter 7 bankruptcy, or an Indiana Chapter 13 bankruptcy, we can help.  If you live in Indiana, don’t hesitate to give my office a call today to set up a free face-face consultation.

Also, for more information, check out the video below.

-Indianapolis Bankruptcy Attorney John F. Bymaster