Prior to declaring chap 7 bankruptcy, how long to you have to

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Prior to declaring chap 7 bankruptcy, how long to you have to continue making payments and for what amount do the payments to your creditors have to be?

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In a chapter 7 bankruptcy, the debtor turns over all non-exempt property to the bankruptcy trustee who then converts it to cash for distribution to the creditors. The debtor receives a discharge of all dischargeable debts usually within four months. Once that is complete, all debts are considered "discharged" and there is no need to make any additional payments.

There are certain types of loans that cannot be discharged in a bankruptcy (e.g. student loans). If there is anything non-dischargable, thsoe payments will have to continue as if the bankruptcy never even happened.

If a court determines that continuing income may allow a debtor to pay debts in the future, then it would require bankruptcy under Chapter 13 rather than Chapter 7.

You may want to take a look at this web site for more info:

http://www.bankruptcyaction.com/questions.htm

I hope this helps!

Reply to Guru_Guy's Post: Although I do appreciate your effort, the answer I am trying to find is the amount I am required to pay creditors before I formally declare bankruptcy. Based on my attorney's direction, I have submitted letters of intent to those creditors I have not used in some time. However, those where I have charged/transferred balances, I understand I need to continue paying for 90 days. The question is how much I am required to pay, e.g., a percentage of the balance, a percentage of the minimun monthly amount due, the minimum amount, or... I hope this clarifies the question. Thanx, Willie

I'm not sure what kind of attorney you spoke with, but nothing in the bankruptcy law requries you to continue paying any debts before you can file bankruptcy. The whole point of bankruptcy is for people who don't have the money to pay their debts.

I suspect your attorney advised you to wait 90 days before filing and to make minimum payments during that time because any debt you take on within 90 days before filing for bankruptcy is usually considered nondischargible (i.e. you still have to pay it back despite the bankruptcy).

But if you are filing Chapter 7, there is no specific amount or percentage that you have to pay before filing bankruptcy. You are merely waiting out the 90 days to make sure that all your debts prior to that time will be dischargable. I would pay the very minimum required during that 90 day period just so they don't jack up interest and penalties before you actually file. Most importantly, do not take on any new debt during this time.

Good Luck!

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Prior to declaring chap 7 bankruptcy, do you how much the ...

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