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John F. Roberts, Esquire Jeanne E. Hovenden, Esquire
Serving all of the Greater Richmond, Virginia, Metropolitan and Tri-cities Area, and Surrounding Counties 7459 Old Hickory Drive Mechanicsville, Virginia 23111 (804) 746-4000 Richmond Area (800) 388-8298 Outside of Richmond Area (804) 746-4146 Facsimile |
The Bankruptcy Process
What Is It—And How Does It Work?
Bankruptcy is a legal process governed by federal rules and procedures contained in the Bankruptcy Code and the Bankruptcy Rules. The primary purpose of bankruptcy law is to provide a debtor with a “fresh start” through which some debts can be paid, restructured or discharged. Bankruptcy also provides a way for creditors to be treated fairly and equitably. The debtor is the person who owes money, goods or services and the creditor is the person to whom the money, goods or services is owed.
A bankruptcy case begins when you pay a filing fee and file a petition with the Bankruptcy Court. Financial information, including a list of all assets and debts, must be provided. All debtors must certify this information under penalty of perjury.
As soon as the bankruptcy petition is filed, an “automatic stay” goes into effect. The “automatic stay” generally stops most debt collection efforts against the debtor, unless the bankruptcy court grants the creditor permission to pursue such efforts. The bankruptcy court, and in some cases a bankruptcy trustee, oversees the activities of a debtor until the debtor obtains an order discharging his debts, and the debtor’s case is concluded.