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Frequently Asked Questions
What is a bankruptcy trustee?
In all Chapter 7, 12, 13 and in some Chapter 11 cases, a case trustee is assigned. In Chapter 7 cases they are called “Panel Trustees.” In Chapter 12 and 13 cases they are called “Standing Trustees.” The Trustee’s job is to administer the bankruptcy estate, to make sure creditors receive as much money as possible, and to preside over the first meeting of creditors. The Trustee either collects and sells non-exempt estate property and distributes the sale proceeds to creditors as in a Chapter 7 case or collects payments from the debtor and pays out money on a repayment plan, as in Chapter 13 cases. In some Chapter 11 cases, the debtor-in-possession is replaced by a Chapter 11 Trustee who administers the estate. The Trustee is not your attorney.
Who can file a bankruptcy?
Almost anyone can file a bankruptcy case, though there are restrictions. For instance, there are specific debt levels for filing under Chapter 13 and if you file under Chapter 7, in certain situations your case may be converted to Chapter 13 if it appears you have sufficient income (or means) to repay some of your debts. Further, if you have been in a previous bankruptcy case that was dismissed, your eligibility to file another bankruptcy case or obtain the benefit of the automatic stay in a subsequent case could be affected. In all cases, it is advisable to consult with an experienced bankruptcy attorney in making this decision so that you understand your rights and obligations.
Where do I file my bankruptcy case?
Bankruptcy cases are filed in the Clerk’s Office of the appropriate United States Bankruptcy Court. Bankruptcy Courts are part of the federal court system which divides the country into 94 judicial districts. Every state has at least one federal judicial district, and many have more. Georgia has three federal judicial districts, Northern, Middle and Southern. Due to its size, the Northern District of Georgia has been split into four divisions, each with a fully staffed Clerk’s Office. All four divisional Clerk’s Offices are open from 8:00 a.m. - 4:00 p.m. Monday through Friday (except legal holidays).
The Bankruptcy Court for the Northern District of Georgia covers the 56 counties in northern Georgia. If the debtor's residence, principal place of business or principal assets have been located in one or more of these counties for the necessary period of time, the case should be filed in the U.S. Bankruptcy Court for the Northern District of Georgia. The specific county of your residence, principal place of business or principal assets determines in which of the Northern District of Georgia’s four divisions your case should be filed. Click HERE to determine which division to file in.
Will I have to appear in Court?
Yes. When a debtor files a bankruptcy case, he or she is required to attend a hearing titled Section 341, First Meeting of Creditors. This hearing is scheduled approximately 30 days following the filing of the case. A debtor filing a Chapter 13 case may also be required to attend his or her confirmation hearing. The confirmation hearing is when the judge assigned to the case approves the repayment plan filed by the debtor. Further, a debtor may be required to attend additional hearings depending on the circumstances of his or her case.
What is the Meeting of Creditors?
This meeting of creditors is held approximately thirty days after the bankruptcy petition is filed. The Chapter 7 or Chapter 13 Trustee presides over the meeting of creditors. The debtor and everyone listed on the list of creditors filed by the debtor will receive written notice of the day, time, and location of this meeting. The purpose of the meeting is to give the Trustee and creditors an opportunity to question the debtor under oath. The meeting of creditors is also called the “section 341 meeting” because 11 U.S.C. § 341 of the Bankruptcy Code requires that the meeting be held.
The debtor (both spouses in a joint case) must be present at the meeting to be questioned under oath by the Chapter 7 or Chapter 13 Trustee and by creditors. Creditors are welcome to attend, but are not required to do so. The meeting may be continued and concluded at a later date without further notice.
What are exemptions?
In accordance with 11 U.S.C. § 522(b) of the Bankruptcy Code, certain states, including Georgia, allow an individual debtor to exempt real, personal, and intangible property from the property of the debtor’s estate. Exempt assets are protected by state law from liquidation and distribution to creditors. The exemptions allowed under Georgia state law are listed in section 44-13-100 of the Georgia Code. Under bankruptcy law, debtors are entitled to list the assets set forth in section 44-13-100 of the Georgia Code as exempt.
Deciding which assets are exempt and if and how you can protect these assets from your creditors can be one of the more important and difficult aspects of your bankruptcy case.
It is important to note that although you may be discharged from further personal responsibility for certain debt, a creditor will still have a lien or security interest in your secured property after you receive your discharge. Under 11 U.S.C. § 522(f) of the Bankruptcy Code, however, you are allowed to file a motion with the Court for an order avoiding certain kinds of liens or security interests in various property.
What is an automatic stay?
The filing of a voluntary, joint, or involuntary petition under any chapter of the Bankruptcy Code automatically operates as a stay against the commencement or continuation of most judicial, administrative or other proceedings against the debtor or property of the debtor’s estate. The purpose of the stay is to give the Chapter 11 or Chapter 13 debtor “breathing time” for rehabilitation, to give the Chapter 7 Trustee the protection necessary for administering the assets of the estate, and to relieve the Chapter 7 debtor from the pressure of creditor collection efforts. During this time, creditors should not be contacting the debtor about debts or taking action to recover property from the debtor in which they claim a security interest. If contacted by a creditor, the debtor may advise them that they have filed bankruptcy and provide them with the case number.
There are also some new limitations on the automatic stay if the debtor has had a previous case or cases dismissed under certain circumstances within the preceding twelve months. If a second case under these circumstances is filed, the stay as to some property will only be good for 30 days. If a third case is filed, then the automatic stay does not apply at all.