Once the debtor has completed the Means Test and knows that she qualifies for Chapter 7, has taken the Consumer Credit Counseling course and received a certificate, and has gathered all the information necessary to complete the various schedules and statements, she can begin filling out the forms. Today we’ll discuss the bankruptcy petition.
What is the Petition?
The petition is the document that starts the bankruptcy. Once it is filed with the correct Bankruptcy Court, it constitutes an order for relief, which imposes the automatic stay. The automatic stay prevents creditors from taking any further action against the debtor or her property. The petition also places all of the debtor’s property under the control of the bankruptcy trustee.
How to Complete the Petition
You can access the petition here. The petition is divided into parts with numbered paragraphs under each part. We’ll go through each paragraph one at a time. It’s best to print it while you read through this explanation of how to complete the petition.
Part 1 is information about the Debtor
Box 1 is identifying information for the debtor. If the debtor and her spouse are filing jointly, complete the information in both columns for the Debtor 1 and Debtor 2. It doesn’t matter which spouse is listed as Debtor 1 and which is listed as Debtor 2 as long as you are consistent throughout all the schedules. Note that only married people can file jointly. “Married” means married under the laws of the state in which you are filing and includes common law spouses if your state recognizes common law marriage. It includes couples that are separated, even if they aren’t living in the same house. For purposes of the bankruptcy petition, parties are either married or they aren’t.
A debtor can be married and file separately; the spouse does not have to file. In that case, no information would be entered under Debtor 2.
Boxes 2-4 are self-explanatory. Give the information requested and nothing more.
Box 5 lists the Debtor’s address. Note that under Box 5, if the parties are separated (but still married), Debtor 2 can list a separate address.
Box 6 asks for the reason the Debtor is choosing to file where she is. We talked about the proper place to file in an earlier post. Usually the answer to this question is that the Debtor has lived in this District for the greater portion of the last 180 days than anywhere else.
Part 2. This part is information about the case.
Box 7 identifies which Chapter of the Bankruptcy Code the Debtor is filing under. You would select Chapter 7.
Box 8 asks how the filing fee will be paid. Usually the filing fee is paid in full when the case is filed. If that’s how you plan to pay the fee, check that box.
Box 9 asks for information about prior filings within the past 8 years. A Debtor may only receive a discharge under Chapter 7 once every 8 years. If a prior case was filed but the Debtor didn’t receive a discharge, she will be entitled to refile and get a discharge. However, if a Debtor filed and received a discharge within the past 8 years, she might not be entitled to another discharge. It depends on what type of case the first case was (Chapter 7 or 13).
Box 10 asks for information about other currently pending bankruptcy cases by or against the Debtor.
Box 11 requires the Debtor to say whether she is renting her residence and, if so, whether the landlord has an eviction judgment against her. If he does, she must complete a supplemental form, Form 101A.
Part 3 is information about any business that the Debtor operates as a sole proprietor.
Box 12. If the Debtor does not operate a business as a sole proprietor, she should mark “No” and skip to Part 4. If she does operate a business as a sole proprietor, she must answer “Yes” and complete Box 13.
Part 4. Box 14 This part asks about any property that poses an environmental threat, such as a dry cleaning business, a service station that might have leaking underground storage tanks, or anything that could pollute the air, water, ground or surrounding areas.
Part 5. Credit Counseling Certificate. Box 15 asks about the Debtor’s completion of the consumer credit counseling course. In most cases the Debtor will have taken the course AND have the certificate. In that case, she should check the first box. In rare cases the Debtor may have taken the course but not received the certificate yet. Checking the second box allows the Debtor 14 days to file the certificate. NOTE: if you have not taken the course, do not check this box and think you have 14 days to take the course and file it. Unless the certificate is dated before you file, your case will be dismissed.
Part 6. Information about debts. This section of the petition provides information about the Debtor’s debts and property.
Box 16 requires the Debtor to classify her debts as primarily consumer or non-consumer debts. Consumer debts are typical household obligations incurred by people who are not running a business. They include credit cards, medical bills, domestic support obligations, car and mortgage loans, personal lines of credit and the like. If a Debtor has primarily these types of debts, she marks the box indicating that her debts are consumer debts.
Non-consumer debts are anything that doesn’t qualify as consumer debt. This is business debt. Money owed for working lines of credit, business credit cards, past due wages, rent on business property, trade accounts and the like are non-consumer debt.
To determine whether debts are primarily consumer or non-consumer debt, separate all debts into one of these two categories. Then total each category. Whichever category has the highest total of debt is the “primarily” category. The total is by dollar amount, not by number of individual creditors.
Box 17 asks again if a Debtor is filing under Chapter 7. Check the appropriate box and complete as indicated.
Box 18 is a range for the number of creditors a Debtor has.
Box 19 is a range for the total amount of assets (without deducting exempt assets) the Debtor owns.
Box 20 is a range for the total amount of debt of all kinds the Debtor owes.
Part 7 is the signature section. Each Debtor should sign their name and date the petition.
If you are filing without an attorney, skip the next page, Page 8, and complete Page 9 and sign again.
If you need bankruptcy help, contact us here, or call or text (801) 413-3708, or email email@example.com.