How to File for Bankruptcy in Idaho

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The two most common forms of bankruptcy are Chapter 7 and Chapter 13, but understanding exactly how to file can be quite confusing, especially without a Boise bankruptcy lawyer on your side. Avery Law wants to simplify the process for you and walk with you every step of the way. Our team of attorneys has three decades of valuable experience to administer to your case.

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Attend Pre-Bankruptcy Counseling & Pre-Discharge Education

Under the 2005 Bankruptcy Act, all debtors must participate in credit counseling within six months prior to filing for Chapter 7 or Chapter 13 bankruptcy. You must be able to show that you received credit counseling from an agency approved by the U.S. Trustee’s office before you file any paperwork. After you’ve filed, you must also complete a pre-discharge debtor education course before you can officially receive a bankruptcy discharge.

Approved Idaho credit counseling agencies can be found here.

Approved Idaho debtor education agencies can be found here.

Determine Which Exemptions You Qualify For

Bankruptcy exemptions clarify which property and assets you get to keep when it’s all said and done. Exemptions apply to both chapters, but may affect you differently based on how you file. In Idaho, you cannot use any federal bankruptcy exemptions; instead, you must use the Idaho state exemptions.

Idaho offers exemptions for a variety of assets, including:

  • Up to $100,000 in equity in your home
  • Up to $7,000 of value in a motor vehicle
  • Up to $7,500 of household appliances and heirlooms
  • Up to $800 of personal property
  • Up to $2,500 worth of tools used for your trade or business
  • Unlimited protection for health aids and public assistance
  • Unlimited protection for medical savings accounts
  • Insurance benefits necessary for support
  • Alimony and spousal support payments

Married couples who file jointly may double these exemption amounts with the exception of the homestead exemption.

Compile and Submit Your Bankruptcy Forms

The forms you are required to fill out will depend on whether you file for Chapter 7 or Chapter 13. These forms can include a bankruptcy petition, certain schedules regarding your financial information, and the means test form. This involves creating an itemized list of your current sources of income, major transactions occurring over the past two years, monthly living expenses, all secured and unsecured debts, and all assets. Tax returns, title deeds, and loan documents are also relevant.

It is imperative you remain truthful and thorough during this step. If a judge or your creditors suspect or have reason to believe you have falsified or omitted certain information from your bankruptcy filing, the outcome of your case could be jeopardized. Once these forms have been completed and all financial documents are collected, you and your attorney will need to file a petition and several other forms with your local Idaho district bankruptcy court. Chapter 7 filings are subject to a non-waivable $335 filing fee, though in certain situations you may be able to pay it in installments. The fee for filing for Chapter 13 bankruptcy is $310 and must be paid in full at once.

Immediately after filing, you will be protected from all forms of creditor harassment and collection efforts under automatic stay. Creditors may not contact you, attempt to claim your property, or pursue foreclosure.

Pertinent bankruptcy forms can be found here.

Submit a Chapter 13 Repayment Plan

If you are filing for Chapter 13 bankruptcy, a repayment plan must also be submitted for approval. While Chapter 7 bankruptcy involves liquidating your assets to satisfy creditors, Chapter 13 involves a reorganization of your finances to repay creditors over a period of three to five years.

This repayment plan must satisfy the following requirements:

  1. It must be created in good faith.
  2. Unsecured creditors must be paid at least as much as they would have been paid if you would have filed for Chapter 7 bankruptcy.
  3. All of your disposable income must be paid into the plan for at least three years.

If approved, these payments must be made in full and on time throughout the duration of your payment plan. In many cases, payments can be automatically deducted from your wages. Your lawyer can help you establish an acceptable payment arrangement with the courts.

Attend a Meeting of Creditors

Your bankruptcy trustee will arrange a meeting of creditors about one month after filing for either form of bankruptcy. Commonly referred to as a “341 meeting,” this meeting provides your creditors the opportunity to question you under oath about your financial affairs. Creditors are more likely to attend a Chapter 13 meeting than a Chapter 7 meeting to question the terms of a person’s proposed repayment plan. Your attorney will negotiate any disputes that should arise during this meeting. If no challenges are proposed by your creditors, your plan will be approved at a subsequent court hearing before a judge.

Wait for Your Bankruptcy Discharge

This is also based on the chapter under which you file. Chapter 7 is generally much quicker and can be resolved in as little as four months. Because a repayment plan is included in Chapter 13, a discharge may not become official until between three and five years after you being paying off certain debts.

Start the Filing Process Today with Our Boise Bankruptcy Lawyer

While there is a great deal of information involved with the bankruptcy process, the end results can be well worth it. Filing for bankruptcy can help you get out of debt and achieve a fresh start to your finances. Our firm looks forward to helping you achieve the best possible outcome.

Taking back control of your finances shouldn’t be put off another day. Get in touch with Avery Law today and find out what benefits you may experience by filing for bankruptcy.