Bankruptcy Chapters Availalbe

The four bankruptcy chapters available of the bankruptcy code available to the individual consumer debtor are listed below as a section of the body of one of the local forms we must sign in the Eastern District of California. The entire body of the form is shown on the counseling services page.

THE FOUR CHAPTERS OF THE BANKRUPTCY CODE AVAILABLE TO INDIVIDUAL CONSUMER DEBTORS

1. Chapter 7: Liquidation Total fee: $299 ($245 filing fee + $39 administrative fee + $15 trustee surcharge)

a. Chapter 7 is designed for debtors in financial difficulty who do not have the ability to pay their existing debts. Debtorswhose debts are primarily consumer debts are subject to a “means test” designed to determine whether the case should be permitted to proceed under chapter 7. If your income is greater than the median income for your state of residence and family size, in some cases, creditors have the right to file a motion requesting that the court dismiss your case under § 707
(b) of the Code. It is up to the court to decide whether the case should be dismissed.

b. Under chapter 7, you may claim certain of your property as exempt under governing law. A trustee may have the rightto take possession of and sell the remaining property that is not exempt and use the sale proceeds to pay yourcreditors.

c. The purpose of filing a chapter 7 case is to obtain a discharge of your existing debts. If, however, you are found to have committed certain kinds of improper conduct described in the Bankruptcy Code, the court may deny your dischargeand, if it does, the purpose for which you filed the bankruptcy petition will be defeated.

d. Even if you receive a general discharge, some particular debts are not discharged under the law. Therefore, you maystill be responsible for most taxes and student loans; debts incurred to pay nondischargeable taxes; domestic supportand property settlement obligations; most fines, penalties, forfeitures, and criminal restitution obligations; certain debtswhich are not properly listed in your bankruptcy papers; and debts for death or personal injury caused by operatinga motor vehicle, vessel, or aircraft while intoxicated from alcohol or drugs. Also, if a creditor can prove that a debtarose from fraud, breach of fiduciary duty, or theft, or from a willful and malicious injury, the bankruptcy court maydetermine that the debt is not discharged.B201 (12/08) Page 2 of 2 USBC, EDCA

2. Chapter 13: Repayment of All or Part of the Debts of an Individual with Regular Income Total fee: $274 ($235filing fee + $39 administrative fee)

a. Chapter 13 is designed for individuals with regular income who would like to pay all or part of their debts in installmentsover a period of time. You are only eligible for bankruptcy chapter 13 if your debts do not exceed certain dollar amounts set forth in the Bankruptcy Code.

b. Under chapter 13, you must file with the court a plan to repay your creditors all or part of the money that you owethem, using your future earnings. The period allowed by the court to repay your debts may be three years or five years,depending upon your income and other factors. The court must approve your plan before it can take effect.

c. After completing the payments under your plan, your debts are generally discharged except for domestic supportobligations; most student loans; certain taxes; most criminal fines and restitution obligations; certain debts which arenot properly listed in your bankruptcy papers; certain debts for acts that caused death or personal injury; and certainlong term secured obligations.

3. Chapter 11: Reorganization Total fee: $1,039 ($1,000 filing fee + $39 administrative fee) Chapter 11 is designed for the reorganization of a business but is also available to consumer debtors. Its provisions are quite complicated, and any decision by an individual to file a chapter 11 petition should be reviewed with an attorney.

4. Chapter 12: Family Farmer or Fisherman Total fee: $239 ($200 filing fee + $39 administrative fee)Chapter 12 is designed to permit family farmers and fishermen to repay their debts over a period of time from future earnings and is similar to chapter 13. The eligibility requirements are restrictive, limiting its use to those whose income arises primarily from a family-owned farm or commercial fishing operation.

BANKRUPTCY CRIMES AND AVAILABILITY OF BANKRUPTCY PAPERS TO LAW ENFORCEMENT OFFICIALS

A person who knowingly and fraudulently conceals assets or makes a false oath or statement under penalty of perjury, eitherorally or in writing, in connection with a bankruptcy case is subject to a fine, imprisonment, or both. All information supplied by a debtor in connection with a bankruptcy case is subject to examination by the Attorney General acting through the Office of the United States Trustee, the Office of the United States Attorney, and other components and employees of the Department of Justice.

WARNING: Section 521(a)(1) of the Bankruptcy Code requires that you promptly file detailed information regarding your creditors, assets, liabilities, income, expenses and general financial condition. Your bankruptcycase may be dismissed if this information is not filed with the court within the time deadlines set by the Bankruptcy Code, the Bankruptcy Rules, and the local rules of the court.

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