chapter 13 bankruptcy disclosure rulesDear T-Boz:

I read in The Wall Street Journal that the judge assigned to your Chapter 13 bankruptcy tossed your case out of court.  I also see that he locked you out of court for 180 days.

I’m sure you filed for Chapter 13 to get a handle on your financial situation, and I’m sorry to see that it hasn’t worked out for you.  That having been said, I think you could have avoided most of this hassle.

This was not your first Chapter 13, T-Boz.  You should have known better. I’m not sure why it went down this way, but I’m thinking maybe you didn’t get the memo about rules of Chapter 13 bankruptcy.

You apparently didn’t show up for your meeting of creditors.  You allegedly didn’t propose a Chapter 13 Plan that provided for your car payments.  According to the trustee’s motion to dismiss, you didn’t make your Chapter 13 Plan payments.

In other words, you didn’t follow the rules of the game.  And when you don’t follow the rules, you get thrown out.

I’m licensed to practice law only in New York, and am pending admission in California.  I know you filed for bankruptcy in Atlanta, so I can’t help you out.  But I thought I’d pass along some advice, which is the same stuff I tell all of my Chapter 13 bankruptcy clients.

The rules of Chapter 13 bankruptcy are pretty simple, but exceptionally important.  Here are the top 8 you need to keep in mind.

  1. Disclose all assets and property, no matter how big or small.
  2. Draft your bankruptcy petition, schedules, and related statements with the precision of a surgeon operating on the brain of a head of state.
  3. Show up for your hearings – all of them.
  4. Make sure your Chapter 13 Plan complies with not only the U.S. Bankruptcy Code but also all local rules and the trustee’s recommendations (unless your trustee is wrong, in which case you need to be prepared to do battle in the courtroom).
  5. Make all of your Chapter 13 Plan payments.  On time.  Every time.
  6. Keep copies of your post-petition car and mortgage payments.  Make them on time.  Again, on time – every time.
  7. Provide every document the trustee requests in order to recommend confirmation of your Chapter 13 Plan.  Some courts have local rules (the U.S. Bankruptcy Court for the Eastern District of New York, for example, uses these), others go by the Code, and still others work on an informal list.  Whatever your trustee and court demand, that’s the benchmark for you.
  8. Keep open and clear lines of communication with your bankruptcy lawyer.  And if you’re filing for bankruptcy without a lawyer … well, maybe it’s time to get one.

Hope this helps.  And if you decide to go back to bankruptcy after the 180-day bar is over, good luck.

– Jay

Image credit:  cindy47452