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General Information about Bankruptcy
Here is a quick overview of what bankruptcy is and the terminology used as provided by the US Bankruptcy Court of the Eastern District of Missouri:
What is Bankruptcy?
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Bankruptcy is a federal court proceeding designed to provide individuals and businesses with a way to address debt problems. It is intended to provide debtors with a
"fresh start" or debt relief, while treating creditors fairly. There are several types of bankruptcy. The major types are Chapter 7, and 13.
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Different Types of Bankruptcy
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Chapter 7
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Often called "liquidation" or "straight" bankruptcy is available to businesses and individuals. A trustee is appointed to sell the debtors
non-exempt property and distribute proceeds to creditors.
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Chapter 13
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Often called "wage earner plan" is available to individuals who have regular income and desire to pay their creditors from future income through fixed
monthly plan payments. In exchange for the agreement to pay, debtors retain possession of their assets. The plan must pay creditors at least as much as they would recover in
Chapter 7.
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Effect of a Bankruptcy Filing
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Automatic Stay
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Filing bankruptcy operates as an "automatic stay" that prohibits continued collection from the debtor or from the debtors property. The protections of the automatic
stay terminate for a number of reasons, including on motion of a creditor and upon dismissal of the case.
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Discharge
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Unless a debtor commits fraud or dishonesty in connection with the case, (or unless the case is dismissed), the debtor should receive a discharge of most debts within 60 to 90
days of filing. Certain debts, such as student loans, certain taxes, and child support cannot be discharged while others can be discharged in one chapter but not another.
Although the debt may be discharged, secured creditors often retain rights that permit them to seize property (collateral) after the bankruptcy case. Filing bankruptcy does
not automatically cancel a secured creditors lien.
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Refiling
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After receiving a discharge in bankruptcy, a debtor may not receive another discharge under Chapters 7 for six years.
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Credit Report
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Credit reporting agencies regularly check bankruptcy filings. A bankruptcy can remain on your credit report for ten years. The Bankruptcy Court does not control
whether or for how long your credit is affected.
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Debtors Obligations
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Filing bankruptcy imposes various duties on the debtor. The debtor must disclose all assets and liabilities and must complete all paperwork completely and honestly. The debtor
must also attend a meeting of creditors and other hearings when ordered.
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Major Events in a Bankruptcy Case
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Commencement and Notice
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Each case begins with the filing of a bankruptcy petition. Along with the petition, the debtor must file a list (matrix) of all creditors including addresses, the debtor's
bankruptcy schedules and the statement of financial affairs. The court sends Notice of the Commencement of Case and Meeting of Creditors to all creditors at the addresses
provided by the debtor. The meeting of creditors is generally the first event in a case. The Notice of Commencement contains important dates and the deadlines for filing
proofs of claim and objections to discharge, dischargeability and exemptions. All parties should carefully read the Notice of Commencement of Case.
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Meeting of Creditors
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The meeting of creditors is a hearing conducted by the case trustee (not the bankruptcy judge) where the trustee and creditors can ask questions of the debtor to investigate
the debtors financial affairs. The debtor must answer these questions under oath.
In St. Louis, the meeting of creditors is conducted at the Thomas F. Eagleton U.S. Courthouse located at 10th and Walnut Streets, downtown. This is the only
hearing that will occur at the Office of the United States Trustee. All other hearings will take place at the Bankruptcy Court.
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Discharge
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In most Chapter 7 cases, unless there is an objection to discharge, the court will issue a Discharge Order in approximately 60 to 90 days from the meeting of creditors. In
Chapter 13 cases, the discharge is issued upon completion of payment under the plan. Creditors may object to discharge or to dischargeability of a particular debt but must do
so by the deadlines set forth in the Notice of Commencement of Case.
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Claims and Closing
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The Notice of Commencement of Case will instruct creditors whether it is necessary to file a proof of claim and the deadline for filing. No claims are required
in a "no asset" Chapter 7 case. A no-asset Chapter 7 case will close shortly after discharge. An "asset case," meaning a case in which the debtor has
non-exempt assets available to pay creditors, will close after sale and distribution. A Chapter 13 case will close after conclusion of the plan and after the trustee files the
final report.
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Dismissal
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The court may dismiss a bankruptcy case if the debtor fails to attend the meeting of creditors or fails to file any document when required. Other parties may also seek
dismissal. Dismissal terminates the bankruptcy case; it does not discharge any debts.
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Is an Attorney Necessary?
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It is possible to file a bankruptcy case Pro Se, that is, without an attorney; however, it is difficult to do so successfully, and your rights may not be fully protected.
Although the law permits individuals known as petition preparers to assist preparation of bankruptcy documents, they cannot give legal advice and generally are not attorneys.
Whether you use a petition preparer or an attorney, you are responsible for the accuracy of all information on your bankruptcy papers. Petition preparers may not
collect the filing fee from you and must file a statement with the court disclosing the amount charged. A list of attorneys and petition preparers who have been barred from the bankruptcy court is available from the court.
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Bankruptcy Crimes
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The Bankruptcy Petition, Schedules and Statement of Financial Affairs are filed
under penalty of perjury. Failure to provide full and complete information on bankruptcy
documents can be grounds for denial of discharge and can be punishable as a federal criminal offense.
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General Court Information
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Court Location
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Address
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Eastern Division
(St. Louis)
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Thomas F. Eagleton U.S. Courthouse
111 South 10th Street
Fourth Floor
St. Louis, MO 63102
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Southeastern Division
(Cape Girardeau)
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339 Broadway
Cape Girardeau, MO 63701
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Northern Division
(Hannibal)
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U.S. Courthouse
8th and Broadway
Hannibal, MO 63401
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Bankruptcy court staff is located only in St. Louis
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Hours (St. Louis)
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Monday through Friday 8:30 a.m. to 4:30 p.m. A drop box and file stamp clock are located on the first floor of the building and may be used for filings after the Clerks office
is closed in accordance with the posted instructions.
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Copies
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Copies of all documents filed in a case can be obtained from the court in person or by contacting Bankruptcy Services at (314) 421-5749. Copy fees apply.
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Internet
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The Bankruptcy Courts website, http://moeb.uscourts.gov contains hearing dates, certain forms and other valuable information.
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Telephone Numbers
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Main Number
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(314) 244-4500
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VCIS
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(314) 244-4999
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(automated case information)
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(888) 223-6431
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Attire
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Bankruptcy Court is Federal Court. It is not informal or casual. Appropriate attire is required.
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Retaining Records
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The debtor should retain copies of his or her bankruptcy documents.
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Change of Address
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Any change of address must be made in writing.
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Bankruptcy Terminology
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Asset
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Property or possessions owned by the debtor. An "asset case" is one in which the debtor has assets in excess of the amount of liens and the amount claimed exempt. A
"no asset case" is one in which there is not enough money or equity to make distribution to creditors.
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Creditor
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A person or party to whom the debtor owes money.
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Certificate of Service
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A document required to be filed showing the date another document was mailed or delivered and the names and addresses of all parties who received the document.
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Debtor
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The debtor is the person who files bankruptcy and who owes money to creditors.
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Discharge
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A court order that releases the debtor from all dischargeable debts. A debt that is discharged does not have to be paid by the debtor. The discharge does not automatically
release liens.
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Dismissal
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A court order terminating a bankruptcy case. Dismissal of a case does not discharge any debts.
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Exemptions
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The amount of property the debtor is allowed to keep from payment to unsecured creditors. The debtor must elect to claim exemptions under applicable law. Exemptions are not
automatic and if not selected, otherwise exempt property may be sold to pay creditors.
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Liabilities
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Financial obligations or debts.
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Lien
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A claim or right to property (collateral) held by a creditor to secure payment of a debt. A deed of trust, mortgage or security interest creates a lien.
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Secured Creditor
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A creditor who holds a lien on property (collateral) to secure payment of a debt. Secured creditors have a lien or right to foreclose on collateral for payment of a secured
debt.
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Trustee
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The person who administers or oversees the liquidation or reorganization of a bankruptcy case. The United States Trustee appoints the case trustee.
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