If you are reading this article then it is likely you have tried to complete the bankruptcy process on your own, without a lawyer, and something went wrong. Unfortunately, since the bankruptcy law and court procedures are very complicated, it often happens that debtors who try to complete the process on their own make mistakes which can result in their cases being dismissed. Working with an experienced bankruptcy attorney helps prevent this from happening, and also helps to ensure the process is smooth and successful from beginning to end.
But if you have already learned the hard way that bankruptcy is not usually a do-it-yourself project, you may still have options for salvaging your case. Read on to learn more about why a bankruptcy case may be dismissed, and contact our office to discuss your situation with an experienced attorney who can help you fix your case.
Why Will a Bankruptcy Case be Dismissed?
Before you can try to fix your case, you have to know why it was dismissed in the first place. There are many legal reasons why a case can be dismissed but the most common are:
1. The debtor doesn’t qualify for Chapter 7. In order to successfully file a Chapter 7 bankruptcy, the debtor must pass something called the Means Test. The Means Test compares the debtor’s income to his/her debts and makes a preliminary decision as to whether person truly cannot pay their bills. Completing the Means Test can be tricky and many debtors who try to accomplish it on their own do so incorrectly, or they do not complete the test at all before submitting their papers to the bankruptcy court. If the court reviews the papers and sees that the person does not pass the Means Test, the court will dismiss the case.
2. Committing fraud. The bankruptcy law requires debtors to provide complete and accurate details about their financial information. Unfortunately, some people think the rules do not apply to them and so they lie on their forms – either by purposefully withholding information or fudging the numbers. When the court discovers this fraud, the judge will dismiss the case and can levy penalties against the debtor including heavy fines and even jail time.
3. Failing to complete the required credit counseling. The bankruptcy law mandates that all debtors complete a course on credit counseling before they submit their case. The course is typically very easy to complete and can be done online or via phone. Once the course is completed, the debtor receives verification that the requirement has been met and must submit that verification to the court. The failure to do so will result in the case’s dismissal.
4. You don’t attend the 341 meeting of your creditors. This meeting is technically an official court hearing and it is mandatory that the debtor attend it. During the meeting, your creditors and the bankruptcy trustee assigned to your case will have the opportunity to ask you questions about the papers your filed for your case. (It is important to note that these questions must be answered honestly as the debtor will be under oath at the meeting). The trustee has the power to dismiss your case if you do not show up to this meeting.
There are other reasons why a case can be dismissed, but there are also options for reopening a case or filing a new one. To make sure you make the right choice for your financial circumstances, contact our office today to speak to an experienced bankruptcy attorney about your case. We look forward to speaking with you!