Getting Ready to File Chapter 7 Bankruptcy (Checklist)
Authored By: Montana Legal Services Association (MLSA)
This article has information about filing for bankruptcy in Montana. If you plan to for file for bankruptcy in another state, you will need to find legal help in that state.
Before you can file bankruptcy, you need to do some things to get ready. This checklist tells you how to get ready. Things you should do before starting on your forms include:
- Decide if you need an attorney
- Read "Bankruptcy Information Sheet"
- Request your Credit Reports
- Find out what you owe on your debts
- Record a Declaration of Homestead
- File your income tax return for current year (if not done already)
- Go to a Credit Counseling Appointment
- Gather Documents Required by "Materials for Trustee" Checklist.
You may decide after reviewing this checklist that you want to hire a bankruptcy attorney if you can. Montana Legal Services Association (MLSA) does not represent individuals in bankruptcy, but we can refer you to the Modest Means Program. The Modest Means Program may be able to provide you contact information for attorneys who have agreed to accept reduced fees for eligible clients. You'll need to apply for MLSA and ask for a referral to the Modest Means Program.
You are required to read the Bankruptcy Information Sheet before filing bankruptcy. You can skip to the Bankruptcy Information Sheet by going to “Mont. LBF 32. Bankruptcy Information Sheet” on page 96. It is a notice from the bankruptcy court to tell you about important information.
- The notice goes through the different types of bankruptcies a person or business may file. This "Getting Ready to File" checklist is only for a person filing a Chapter 7 bankruptcy.
- The notice makes clear all debts that can be discharged when you file your case are discharged even if they are not listed in your filing.
- The notice says that you must fill out your bankruptcy paperwork truthfully and completely. You should not try to hide any property or tell the bankruptcy court anything that you know is not true. If you do, this may be a bankruptcy crime. You can be fined or imprisoned. Making an honest mistake is not a bankruptcy crime though. You just need to do your best to answer all the questions on your forms.
- Finally, the notice describes Reaffirmation Agreements. This is an agreement you can make with your lender to continue to pay on your secured debts such as your car or home after the bankruptcy is final.
Please take a moment to read the whole notice. When you are finished, please go to the next section below.
To fill out your bankruptcy paperwork, you will need to ask for copies of your credit reports. You will need to ask three different credit bureaus. They are:
You can ask for free copies of your credit reports online. The only truly free credit report website is: www.annualcreditreport.com. Some websites provide one or two for free, but most other websites which say they are free are not free. They will later charge your credit card for monthly fees.
Getting your credit reports may take a little while, so ask for them now. Be sure to ask for copies of all three credit reports. They often have information that is different. If you can get onto the Internet, take a moment to ask for your credit reports right now. If you cannot get online right now, plan to go somewhere that has free Internet access. You can get online for free at public libraries. Ask for copies of your credit reports as soon as possible.
You can also request your credit report in writing through the mail. If you have moved over the past few years, you may not be able to get your credit report online. The credit bureaus use your address to make sure you are who you say you are. If your address has changed a lot, they may not be able to make sure it is you. You will have to ask for your credit report in writing. There is a form for you to use at the end of this handout.
When you have copies of your credit reports, or if you need to ask for them later, please go to the next section.
You will need to know what you owe now on all your debts. The amount you owe should be listed on the last statement from the creditor or debt collector. If you do not have your last statement, you can use the most recent balance from your credit report. The total amount you owe at the time of filing your bankruptcy is discharged in your bankruptcy; not the amount listed.
If you owe a court judgment or criminal fines, you should call your local Justice Court, Municipal Court, and District Court to get the current balance and case numbers. If you give your name, they can run a search for you.
If you owe child support or alimony, you will want to get copies of the most recent court order and most recent statement from any child support collection agency.
You may also owe debts that are not on your credit report. Some creditors do not report to credit bureaus. For example, many doctors, landlords, or other creditors do not show up on credit reports. Court fines may not show up. Private people often do not report to credit bureaus either. If you know you owe money to a business or a person, you will list it on your bankruptcy. List it even if it is not on your credit report.
You may have debts that have gone to collection but you don't know what you owe now if it is not on your credit report. You can call the creditor or collector and ask. Again, if you forget to list a debt it is still discharged.
The statement should say how much you owe. It should say which business turned it over to collections. You need to know this because you need to list both the original creditor and any debt collectors that later tried to collect the debt. You can ask for this information over the phone, but it is best to ask in writing.
When you know what you owe on all your debts, please go to the next section.
If you own your home, you need to fill out a document called a Declaration of Homestead. This document protects the equity in your home. Equity is how much money you would get if you sold your home, after paying off any loans on it. Your home can be a regular house, a mobile home, or a fifth wheel. You just need to live in the home and own it.
You will need the legal description for your home. This is on your deed or title. Find your legal description. Write it on the Declaration of Homestead. Finish filling out the rest of the form. Do not sign it yet.
You must sign the Declaration of Homestead in front of a notary public or the Clerk at the Clerk and Recorder’s office where you need to file the form. You can get the form there as well. If you are married, both spouses must sign the form in front of a notary or clerk. It doesn't matter if only one spouse's name is on the property. You should both sign the form.
Be sure the clerk records the document. Bring two extra copies to have them stamped by the clerk. Keep one copy for your records and one copy to give to the Trustee.
When you are done, please go to the next section.
If you need to file income tax returns for past two years, you have to do that before you can file bankruptcy. If you haven't filed your tax returns, you will need to do it as soon as possible. You will not be able to file bankruptcy until this is done.
You can probably file your taxes for free. Free tax filing information is listed on MontanaFreeFile.org. These services will help you get your tax refund as soon as possible. They are free and will not take part of your tax refund like a refund anticipation loan does. You will get your entire tax refund. In the year following the year you file, you will have to provide the Trustee a copy of your tax return, the Chapter 7 Trustee may take a portion of your refund, dependent on when you filed for bankruptcy. You cannot spend any of your tax refund until the Trustee says you can.
You must attend a credit counseling appointment before you can file bankruptcy. You may choose to complete any bankruptcy counseling program so long as you receive a Credit Counseling Certificate. You can do the appointment online or over the phone.
You can find a list of approved credit counseling agencies online.
Schedule your appointment now. If you have access to the Internet, plan a time to complete the online course. Remember all bankruptcies in Montana are filed in the Butte District when asked.
Important: Your counseling certificate is only good for 180 days! Do you think you will have your bankruptcy filed within 180 days? If it will take you longer, wait to do your counseling. When you are done arranging this appointment, or if you are waiting, please go to the next section below.
The Materials for Trustees can be found at: http://www.mtb.uscourts.gov/sites/mtb/files/2009BKForms.pdf. Skip to Mont. LBF 33 on page 98.
This form is provided at the end of this handout. This form is a checklist of documents you will have to give to a Bankruptcy Trustee after you file bankruptcy with the documents 14 days prior to your meeting. However, you will need all these documents to fill out your Official Bankruptcy Forms. Go through the form now.
This form is provided at the end of this handout. This form is a checklist of documents you will have to give to a Bankruptcy Trustee after you file bankruptcy with the documents 14 DAYS prior to your meeting. However, you will need all these documents to fill out your Official Bankruptcy Forms. Go through the form now.
If a document does apply to you, you must get a copy of it. Many documents must be gathered. It may take some time to get them all together, especially if you need to get them from someone else. Start getting the documents now. That way you will not have to wait for them later and hold up your bankruptcy.
Documents you need include:
- Copies of your state and federal income tax returns for the past two years.
- Any documents for real property that you own. This includes a house or land. You will need to get copies of the documents listed under number two, if they are applicable to your property. If you do not have these documents, check with your lender or the county clerk and recorder's office.
- Any documents for personal property that is collateral for a loan. This means any personal property (other than a vehicle) used to secure a loan. This includes personal property you currently own. It also includes any personal property that you sold or had repossessed within the past four years. This also includes any property you plan to sign back over to the lender after filing bankruptcy. If you do not have copies of the documents requested, check with your lender.
- Copies of vehicle titles and registrations. This includes any titled motorized vehicles and trailers and any loan documents associated with each vehicle.
- Documents for a mobile home. If you do not have copies of these documents, check with your lender or Clerk and Recorder’s.
- Proof of any life insurance with cash value you may have.
- Documents for any retirement or pension plans you may have.
- Documents for any insurance policies you have for property you own. This includes casualty insurance such as a homeowner's policy. It also includes liability insurance, such as car insurance. You need either your insurance card or the declarations page of your policy showing you are current.
- Copies of the past three months' statements for any financial accounts your name is on. This includes any bank accounts or investment accounts. You will need the most recent statements for three months before you actually file your bankruptcy and through date of filing.
- Copies of any stocks or bonds you own.
- Copies of certain business documents if you have operated any kind of business within the past six years.
- A copy of any divorce decree or marital property settlement within the past two years.
- Copies of loan applications you have turned in during the past two years. You only need copies of loan applications for loans that are still open at the time you file bankruptcy. Also, this does not apply to credit cards or credit card applications.
- You also need six months of paystubs to complete the Official Bankruptcy Forms.
Get copies of all these documents and set them aside in a safe place. You will use these documents to fill out your Official Bankruptcy Forms.
- The State Bar Lawyer Referral Service may provide you with contact information for attorneys who provide the type of assistance you are seeking, for a fee. You can contact the State Bar Lawyer Referral Service at (406) 449-6577 or montanabar.org.
- Montana Legal Services Association (MLSA) provides free civil, non-criminal legal help to eligible clients. Learn more about how to apply for free legal help in Montana.
- If you need to file Chapter 7 bankruptcy, you may be able to file your bankruptcy through Upsolve. Upsolve is a national non-profit that helps people file for Chapter 7 bankruptcy at no cost. Read about whether Chapter 7 bankruptcy is right for you and visit Upsolve's website to see if you qualify.
- Find a checklist of the Montana Bankruptcy Court forms you’ll need to file for a Chapter 7.