Bankruptcy law requires that bankruptcy attorneys share with you the following rules. They are given as information and not as an attempt to scare you from filing bankruptcy. Bankruptcy is a right provided to you under federal law. These rules are only given to prevent people from intentionally abusing this process by cheating and being dishonest. Informing a consumer of these rules is required by law under the Bankruptcy Reform Act enacted by Congress in 2005 under intense lobbying by the credit industry and should not intimidate you from filing bankruptcy. Our office has assisted people with filing bankruptcy for over 25 years. During that period of time, we have noticed that almost all of our clients are honest and hardworking people who, due to circumstances beyond their control, cannot repay their debts.
If you don’t follow these rules, you could be subject to criminal sanctions. If you do not follow these rules your case could be dismissed and you may not be able to re-file your case.
Rule #1 – The information you give to an attorney, a staff member of the law firm, the bankruptcy trustee, or the bankruptcy court that is provided with your petition and during the case must be complete, accurate, and truthful.
Rule #2 – Everything you own and every debt you owe must be completely and accurately disclosed in the documents filed to commence this case. Bankruptcy is not a “pick and choose” proceeding. You do not leave some debts in and leave some debts out. Everything must be included. You must value each item you own at the rate it would cost you to replace the item with one of the same condition, age, and usefulness.
Rule #3 – You will be required to complete a current monthly budget. This will be performed with your attorney. This budget will be based on your Current Monthly Income and your regular monthly expenses. This Current Monthly Income is more than just that paid to you by your employer and will include any income received in the past six (6) months commencing with the first full month before your bankruptcy filing. This could include government assistance, social security, unemployment, or side jobs or any other sources. The regular expense should be as close as possible and should be based on a reasonable inquiry.
Rule #4 – The bankruptcy bode requires you to perform certain tasks including filing certain documents with the Court. Your attorney will notify you of the need and time limits for performing these tasks. If you fail to meet these deadlines your case will automatically be dismissed and you may be barred from re-filing a case.
All of the information you provide will be subject to audit by the United States Department of Justice. If you fail to provide this information your case may be dismissed. If you act dishonestly you may be subject to criminal sanctions.
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