If you need to file an emergency bankruptcy petition just:
- take your credit counseling class
- attempt to gather all of your documents and
- make an appointment.
Our office will do an emergency petition to stop a foreclosure sale. However, without completing the class certification first, your petition will be dismissed. There are sometimes good reasons to file an emergency bankruptcy petition if it is done right. By filing the petition just before the sale you can avoid allowing the bank time to object and filing a motion to avoid the stay. But there are also reasons to avoid filing an emergency bankruptcy petition which we will talk about.
Waiting until the last moment
Sometimes people wait to file until the last minute before a foreclosure sale. Then, filing bankruptcy to stop a foreclosure sale in Louisville Kentucky becomes just that an emergency. Clients get led astray by incorrect information from the mortgage company about their pending mortgage modifications. In fact, mortgage companies often tell a client to not hire an attorney when they need one. Unfortunately, the mortgage companies do this because they don’t want their clients to know there are other options like suing the bank or debt collectors back with counterclaims.
One good reason to file an emergency bankruptcy is to stop a business from being shut down. The IRS and state tax departments regularly padlock and close businesses due to overdue taxes. In cases like that, you need to file bankruptcy immediately. If your home is selling tomorrow you need to file your case today. We do just that if we have appointments available. Sometimes we do. I will often stay open late to get it done. But sometimes I can’t.
Reasons to Avoid Filing an Emergency Bankruptcy Petition
Some attorneys will file a short skeleton petition. With a skeleton petition, the Court requires filing the remaining schedules within 14 days or less. Then, if the remaining schedules are not filed on time, the case may be dismissed, or worse you may be banned from refiling from 6 months to a year.
Filing a skeleton petition puts the judge and the court clerks through additional work. Filing a poor petition means you lose the respect of the bankruptcy judge, court clerks, and the trustee. You also call attention to your case.
Paying the filing fee in installments or a skeleton petition is never good.
Some attorneys market to low-income people for paying filing fees in installments. Paying the filing fees in installments and filing a skeleton petition both draw added attention to your case and causes closer inspection. It also invites the case to be dismissed if the installments are not paid on time. If the case is dismissed, the attorney gets to charge for filing the second case. Studies show that filing incomplete petitions in a rush often means you also lose the property. In the long run, it’s more costly to use an attorney who does it quickly and cheaply. Take the time to properly prepare and file a complete petition if you can.
Filing a rush petition in Louisville, Kentucky usually means lost exemptions and benefits.
The problem with emergency petitions is you sign a petition under oath with the requirement to completely and accurately report information. Preparing a bankruptcy petition must go through proper preparation over time which includes thorough planning. By filing an incomplete or inaccurate petition, you often lose benefits and take the risk of penalties. This can include criminal prosecution.
You may not be able to file a second time if you make a mistake. If you file a second case within a year, the stay expires within 30 days if you don’t get an extension. When you file a third case within a year there is no stay to stop a foreclosure. If you filed a sloppy petition, you probably won’t be able to refile effectively.
Filing an emergency bankruptcy petition and the problems you 5encounter.
You don’t have time to make sure liens are properly filed in an emergency. You don’t have time to check on what other liens may exist. By not preparing a complete, accurate, and well-prepared petition you risk a lot. People have done this and lost homes to a Trustee. The discharge could be denied. If you take the time to check out facts before you file you may be able to discharge taxes, recover property, and strip liens. Deadlines are likely to be missed if you don’t take this time. In an emergency, documents are not supplied on time, and decisions are rushed. As a result, most attorneys will ask for additional fees for doing additional work and risking penalties.
The court may refuse to dismiss the case if a Chapter 7 trustee finds assets or preferential transfers. The Chapter 7 trustee may then take the property you did not intend to lose. Unfortunately, the cause of this is rushing and not filing a complete petition with proper preparation.
There is sometimes no choice but to file an emergency bankruptcy.
If you need to file a petition in an emergency, take your credit counseling class and come see us. What we will primarily need will be the class certification and the funds to file.
Sometimes emergency petitions are necessary when an event happens that you could never expect. Unexpected events include car repossessions, wage garnishments, bank account seizures, and IRS garnishments. Also, you normally have months to prepare and months of advanced warning before the foreclosure sale.
However, last-minute emergency petitions to stop a foreclosure do happen. In fact, it only takes two hours to prepare most petitions which are 60–80 pages long. Taking time means petitions get accurately prepared. But we do file petitions in an emergency. However, when you file a rushed petition it places cars and homes at risk because car liens and mortgages are not verifiable. The debtor may miss transfers of property in the petition.
Resources for Bankruptcy
Louisville Kentucky Bankruptcy Forms
How to Manage Home Mortgages In or Out of Foreclosure
Foreclosure Landlord-Tenant Lease Eviction Laws
Predatory Auto Subprime Car Loans
How to Get a 725 FICO Credit Score after Bankruptcy
How to Manage Your Car Loans in Bankruptcy
If you are facing bankruptcy, don’t delay because timing is crucial. I am here to help you. So, contact my office right away to start the conversation. Nick C. Thompson, Bankruptcy Lawyer: 502-625-0905.
