For over 20 years Patricia M. Mayer and Scott F. Waterman, Esquire have been practicing Chapter 13 bankruptcy in Philadelphia. Most Chapter 13 cases are filed to save the most precious belonging – a home. When a client hires us for a case, like all bankruptcies we handle the cases personally. We have no associates. This way we offer Chapter 13 debtors the highest quality legal services and the personal guidance necessary to make the process smooth. We are are leaders in our field and regularly participate in helping to educate other Philadelphia Chapter 13 bankruptcy lawyers. Kindly explore our website, and see how we can help you. Help is a phone call away.
Chapter 13 Bankruptcy Process
- Prior to the Filing
All clients of Waterman & Mayer, LLP will be provided with a Bankruptcy Questionnaire requesting information about their monthly income, monthly expenses and assets and debts. Clients will be asked to provide copies of certain financial documents, such as their last two years’ income tax returns, recent bank statements, debt collection bills, and legal papers.
Patricia M. Mayer and Scott F. Waterman will then order record owner lien searches on all real estate owned by the clients. Waterman & Mayer, LLP will also obtain triple credit reports on each client to make sure all creditors are identified.
The information will then be used to draft the clients’ Chapter 13 Petition and Schedules, and Chapter 13 which are the legal papers used to file a Chapter 13 bankruptcy case.
Prior to the bankruptcy filing each client must also complete pre-bankruptcy credit counseling and obtain a Pre Bankruptcy Credit Counseling Certificate. This task may take an hour, and can be completed by the client at home on the phone or the internet. One credit counseling firm we recommend is Summit Financial Education, Inc. the Pre-Bankruptcy Credit Counseling Certificate is only $9.95 and can be obtained easily on the internet. Its website is www.summitfe.org.
Once the Pre Bankruptcy Credit Counseling Certificate is obtained, and the balance of the up front attorney’s fees are paid, the client meet with directly with Patricia M. Mayer or Scott F. Waterman to personally review the petition, schedules and Chapter 13 Plan to ensure that the information is accurate and correct. The balance of the counsel fees can be paid in the Plan.
- Filing the Chapter 13 Case
Our Bucks County, Philadelphia and Delaware County offices file all bankruptcy cases electronically, so a client will obtain bankruptcy court protection the minute the case is filed.
Once a bankruptcy case is filed in the United States Bankruptcy Court For the Eastern District of Pennsylvania, the court will issue the automatic stay Order and Waterman & Mayer, LLP will send a copy of the order to stop any foreclosure actions or law suits. Copies of the Petition, Schedules and Plan will be mailed to the clients to further review and retain.
The clients will then be required complete their Debtor Education Course with a certified credit counseling firm. This course may take up to 1-2 hours and can also be completed on the computer. Summit Financial Education, Inc. charges $7.95 to complete the course. The course will teach debtors about budgeting and how to read a credit report. But the course is mandatory. Without obtaining the Certificate of Completion of the Debtor Education Course a debtor may not obtain the discharge order at the end of the case.
After the case is filed, Scott F. Waterman or Patricia M. Mayer, if necessary, may file special motions to avoid judgment liens on the debtors’ bank accounts or real estate.
- Plan Payments
The Debtor should resume making his or her regular monthly mortgage and car payments the first time they are due after the case is filed. For example if the bankruptcy is filed on January 14 and the debtor’s mortgage is due on the first of the month, then the debtor shall make his or her monthly payments to the mortgage company, commencing February 1st.
In addition, starting two weeks after the case is filed, the debtor shall tender monthly trustee payments to the Trustee, either by money order, wage attachment or automatic deduction from a bank account.
- Meeting of Creditors
Approximately two months after the case is filed, the Debtor is required to attend a “Meeting of Creditors.” The name is a misnomer, because typically no creditors appear. Either Patricia M. Mayer or Scott F. Waterman will appear with the Debtors. Chapter 13 Meeting of Creditors in the Eastern District of Pennsylvania are all held at one location, 1234 Market Street, Philadelphia.
Although debtors do not have to wear a tie, they should be dressed in a business casual manner.
All debtors are required to bring government issued photo identification (such as a driver’s license) and their social security card, w-2 or 1099 with their complete social security number for verification purposes.
The Meeting of Creditors is conducted by a Chapter 13 trustee. The trustee is an attorney appointed by the court to oversee the case. Patricia M. Mayer and Scott F. Waterman are familiar with the Trustees and usually the meetings are quick and easy.
Prior to the Meeting of Creditors Patricia M. Mayer or Scott F. Waterman will prep the client personally to review the kind of questions the trustee may ask.
At the meeting, the trustee will ask the debtor to produce the identification and will then ask a series of questions about the petition and schedules and Chapter 13 Plan. All of the questions and answers will be recorded on a tape recorder and the debtor must answer all the questions truthfully.
The questions are not that complicated. They include the following:
- What is your name and address?
- Have you ever filed bankruptcy before?
- Did you read your petition and schedules before you signed them?
- Did you read the Bankruptcy Information sheet, which is a notice that Patricia M. Mayer and Scott F. Waterman will provide the debtor prior to the meeting of creditors.
- Please identify your signature on the petition and schedules.
- Do you own any real estate?
- How much is it worth?
- How did you determine the value?
- Do you have any personal injury actions or lawsuits against anyone?
- Do you have any annuities or structured settlements?
- Do you expect to receive any inheritance within 180 days of the filing?
- Do you owe any domestic support obligations?
- Have you filed all of your income tax returns?
- Do you owe any money to the I.R.S.?
- When was the last time you used your credit cards?
- Have you cut up all of your credit cards?
- What do you do for a living and what is your employer’s name?
- Have you listed all of your monthly income on your schedules?
- Have you listed all of your monthly expenses?
- Have you transferred or mortgaged any property to anyone in the last four years?
- Do you know the terms of your plan and how much you need to pay the Trsutee.
Finally, the debtor is asked, “What led to their having to file a bankruptcy?” A one sentence answer is all that is required, i.e. a drop in income, unemployment, divorce, etc.
The meeting of creditors will typically last 10-15 minutes. Then, the Trustee will be required to file some paperwork with the court and in most cases a debtor will not have any further contact with the trustee.
- Claim objections and Confirmation Hearing
The Creditors will be asked to file a claim with the bankruptcy court. If the debtor disputes the claim he or she could file an objection to the claim or a portion of the claim.
Approximately 6-7 months after case is filed, the Debtor’s Plan will be submitted to a Bankruptcy Judge for approval. Many Chapter 13 Plans are like scales and they need to balance. The amount that is paid must equal the amount the creditors say is due and owing.
Once a plan is in balance, the Court can confirm (approve) the Plan.
Once all of the Plan payments have been made, usually after 3-5 years, the Court will grant a Chapter 13 discharge , and the discharge order prohibits the debtors’ creditors from later attempting to collect any discharged debt from the debtors. Any creditor who violates this court order may be held in contempt of court and may be liable to the debtors in damages. If a creditor later attempts to collect a discharged debt from the debtors, the debtors should give the creditor a copy of the order of discharge and inform the creditor in writing that the debt has been discharged. If the creditor persists, the debtors should contact Waterman & Mayer, LLP. If a creditor files a lawsuit against the debtors on a discharged debt, it is important not to ignore the matter, because even though a judgment entered against the debtors on a discharged debt can later be voided, voiding the judgment may require the services of an attorney, which could be costly to the debtors.
Debts that are discharged are not taxable for income tax purposes. Which is another benefit of filing a bankruptcy.