Dictionary of Legal Words & Phrases
Definitions of frequently used terms in Bankruptcy:
Chapter 7 Bankruptcy: In short, a chapter 7 bankruptcy is the total liquidation of your debt. Think of a chapter 7 filing as a "clean slate."
Chapter 13 Bankruptcy: A repayment of your debt to a bankruptcy trustee made in monthly payments for a length of no greater than 5 years.
Chapter 13 Plan: This is the plan for making monthly payments to the trustee. The amount of your payment is based on your income versus your expenses and your disposable income.
Client Packet: This client packet includes; a retainer agreement, disclosure statements, a list of things you should know about filing bankruptcy, and a client questionnaire. The client packet is the FIRST STEP to filing a bankruptcy through our office. To request a packet, please email Melissa at melissaatthompsonlaw@gmail.com.
Demand for Delay of Sale: This demand is a legal document filed with the court that demands a delay of the sale of your home from foreclosure for approximately six months. There is a specific window of time that this document can be filed, so if you are facing foreclosure and wish to remain in your home in order to make other living arrangements, or in hopes of a loan modification, you must notify our office immediately. The demand for delay of sale can be prepared by our office for you. For more information contact Melissa at melissaatthompsonlaw@gmail.com.
Discharge: A discharge comes from the court and is an official decree that you are no longer responsible for the repayment of your debts. A discharge signifies the end of your bankruptcy proceedings, and also the end of our representation of you.
Disposable Income: This is the amount of money you have left at the end of every month when we calculate your living expenses from your monthly pay.
Means Test: This is a method of calculation, by law, which we use to calculate your eligibility to file either a chapter 7 or a chapter 13 bankruptcy. The means test takes into account the median income of Iowans and your own household income. The means test is a complicated beast and you should not assume that you're ineligible to file a chapter 7 bankruptcy simply because you make more than the median income of Iowans.
Meeting of Creditors: Commonly known as a "341 meeting" this is a meeting between you, the debtor, and your bankruptcy trustee. Nancy is also present at this meeting. It is held at a public location and is an opportunity for your creditors to come and question certain aspects of your bankruptcy. The 341 meeting is nothing to get worked up about. You do not go before a judge or even to a courtroom. Your portion of the 341 meeting will usually last no longer than 10 minutes and very rarely do your creditors actually appear.
Reaffirmation Agreement: This document reaffirms your debt, even after the bankruptcy. This document comes from creditors directly and binds you to the debt. It is the general practice of our office not to sign reaffirmation agreements unless the creditor agrees to make substantial concessions on the debt so if you wish to reaffirm your debt, you should be prepared to file the documents on your own and may be called before a judge.
