Written by the Upsolve Team.
Updated October 15, 2020
Every four years, the eyes of the nation turn to Des Moines for the Iowa Caucuses. Every four years, presidential hopefuls, future voters, and journalists descend on the city. This helps the local economy thrive. Despite this boost in revenues, each year thousands of Iowans find themselves struggling to make ends meet and filing bankruptcy in Des Moines. Filing bankruptcy in Des Moines is not as scary as it may seem. Bankruptcy is often viewed as the end of the world but think of it as a new beginning and not a last resort. Over the years, you pay interest and fees on debt that you owe, so chances are you’ve already paid back more than you borrowed on some of your credit cards. Bankruptcy relief is a form of insurance that can help rescue you in a time of need. Not all insurance needs to be provided by one of the corporations downtown - bankruptcy is an insurance provided by the U.S. Constitution. If you’re looking for information about Chapter 7 bankruptcy in Des Moines, you’ve come to the right place. If you do decide to file bankruptcy, you’ll be in the company of American icons, including Walt Disney, Henry Ford and P.T. Barnum who all went on to do amazing things after relieving themselves of burdensome debts, proving that filing bankruptcy is not the end.
Chapter 7 bankruptcy cancels your obligation to pay back debts. Once you receive your bankruptcy discharge, federal law prevents creditors from ever trying to collect those debts from you. In fact, from the moment you file, you are protected by the automatic stay. The automatic stay is a giant stop sign requiring creditors to stop all collection activities. Creditors may not repossess a car, foreclose on a home, or garnish wages. All lawsuits and judgments must also stop as soon as a creditor receives notice of your Des Moines bankruptcy filing.
The decision to file bankruptcy is not an easy one but, if you’re overwhelmed with debt, it may be the best one. Some of the telltale signs that bankruptcy is right for you may be that you can only make the minimum payments on your credit cards, have accounts in collections, or are facing lawsuits, wage garnishments, or liens. If your debt repayment plan involves a significant amount of hoping and you don’t see an end in sight, filing a Chapter 7 bankruptcy in Des Moines may be your best bet. It is never bad to seek free advice before you make any final decision about filing bankruptcy in Iowa.
A common misconception about bankruptcy is that you will “lose everything.” However, the law allows you to protect certain assets (your property) from creditors. These protections are called exemptions. For example, when filing bankruptcy in Des Moines, your home is safe from creditors regardless of the value, so long as the land does not exceed ½ an acre in the city limits or 40 acres outside city limits. Up to $7,000.00 of equity in a motor vehicle can be protected. The equity of your vehicle is the value of the vehicle minus any debts owed on that vehicle. There are a number of other exemptions provided for someone filing bankruptcy in Des Moines. If you own assets that exceed those exemptions and you want to keep them, you may opt to file Chapter 13 instead of Chapter 7. Chapter 13 bankruptcy is for those with steady income who want to repay some or all of their debts through a court-supervised payment plan. Chapter 13 may be a good fit for those who have non-exempt assets or make too much money to file for Chapter 7 bankruptcy in Des Moines.
Over 2,000 people file each year for Chapter 7 bankruptcy through the Bankruptcy Court in Des Moines, Iowa, and you, too, can benefit from the relief they have received. If you can’t afford to hire an attorney, use Upsolve.org’s free online bankruptcy service to help navigate the process.
Des Moines Bankruptcy Lawyers - Estimated Cost
To determine the cost of a bankruptcy lawyer for filing a Des Moines bankruptcy, you could call a few different law firms and ask, but we have already done some of the legwork needed to figure this out for you. The average Des Moines bankruptcy lawyer costsbetween $965 and $1,500 but most attorneys also provide a free initial consultation. A free consultation is a great way for you to get legal advice from an attorney about what it would be like for you to file without having to spend anything but time. The attorney will typically tell you the cost to file a bankruptcy with their office at the end of your consultation If you hire a bankruptcy lawyer, the attorney will prepare the forms for you, file the forms with the Court, and join you at the 341 meeting. Remember, hiring a Des Moines bankruptcy lawyer if you can afford to can help you in the process but you can file a bankruptcy on your own, too!
How to File Bankruptcy in Des Moines, Iowa for Free
If you’ve never baked a cake, you may imagine that creating something so wonderful is very complicated. If you have baked a cake, you know that carefully following instructions makes the process relatively straight forward. Filing a Des Moines bankruptcy is the same thing - it can seem very complicated, but carefully following the instructions can make it a piece of cake. Each step is not difficult. Use this guide to learn how to file bankruptcy in Des Moines and take the steps one at a time to ensure your Des Moines bankruptcy is a success.
Collect Your Des Moines Bankruptcy Documents
The documents you will need to file bankruptcy in Des Moines include pay stubs, social security statements, disability payments, and other documents to show your income. For income documents, six months should be sufficient, but you will need your last two years of filed income tax returns. You can find your expenses in your bank account statements, but also in your bills and similar documents. Even if you can’t find all of your credit card bills, collect what you can and verify by comparing to a copy of your credit report. Everything you own is an asset, even if you don’t think someone would want to buy it. Your assets include your car, your house, your couch, that woolly mammoth bone you pulled up from your backyard, etc. Not all assets have documents showing their value, but your home and your car likely do. You will also need a driver’s license or state-issued ID and your social security card.
Collecting all of the documents may seem overwhelming, but just take it one step at a time. Don’t let the fact that it is a lot stop you - break it into smaller tasks (today, get income, tomorrow, debts, etc.) If you don’t have your paystubs, ask the HR department at work, your employer, or the company that handles payroll for your employer, like ADP, for copies. After creating an online account, you can immediately download copies of your tax returns. Start the process to file now and collect the documents to file your Chapter 7 bankruptcy in Des Moines as you go.
Take Credit Counseling
Before you can file a Chapter 7 bankruptcy in Des Moines, you must take a credit counseling course. Don’t worry - this isn’t something that will require you to spend hours in a classroom or buy books. You can take the case online or in person and can choose from a long list of approved providers. The purpose of credit counseling is to help you decide whether a Des Moines bankruptcy is right for you. The credit counseling course asks about your current income, your budget, and your debts so you can have some clarity about the benefits filing Chapter 7 bankruptcy might provide. The course takes about an hour and costs between $10 and $50. Some people worry that they do not know the exact answers to the questions asked as part of the course. Don’t worry - none of the information you discuss in the course is sent to the Bankruptcy Court and you won’t receive a grade. It helps to look at the course as a way to prepare you to file your Chapter 7 bankruptcy in Des Moines. When the course is completed, you will receive a certificate that you need to submit it to the Court when you file your Iowa bankruptcy.
Complete the Bankruptcy Forms
Some people think that bankruptcy just needs to be “declared.” However, bankruptcy is a court filing and you “declare” it by submitting a packet of forms to the Des Moines Bankruptcy Court. This packet tells the Court all about your financial situation, including who you are, your income, your expenses, and your assets and debts. The packet contains forms that are broken into “schedules” to organize the information. That way, everyone uses the same documents when they file bankruptcy - the difference is in the personal details. Just like when completing your taxes, the forms can be long and ask for a lot of information, but the information itself is not necessarily complicated. Collecting documents and information before you begin can help manage the process, so you have fewer interruptions because you’ll have all the information you need to complete the packet at your fingertips. The entire packet must be fully completed. To avoid skipping a form, you should complete them in the order they appear on this checklist. If you are filing your Chapter 7 Bankruptcy with Upsolve, trust the process. It has been created to help you manage filing on your own, even if it takes several days. You will have trouble completing the forms if you haven’t collected all of your documents. Don’t leave any blank spaces on your forms and don’t leave any forms partially, or incorrectly completed. Tip: consider writing “n/a” for not applicable if you do not believe you have anything to enter into a part of a form. Remember, providing inaccurate or incomplete information can delay how long it takes to complete your Chapter 7 bankruptcy in Des Moines and even cause the Iowa Bankruptcy Court to dismiss (throw out) your case.
Get Your Filing Fee
Whenever a Chapter 7 bankruptcy in Des Moines is filed, federal law requires payment of a filing fee of $335. The fee includes the court filing fee of $245, the administrative fee of $75, and the trustee surcharge of $15. It pays for the people who work with you on your case, the clerks, the judge, and even the trustee. If you have saved money by filing without an attorney and can afford to pay the fee when filing bankruptcy in Des Moines, you should plan to do so. Sometimes, though, paying the filing fee is just too much to ask. In those cases, you can apply to have the filing fee waived. While not every request for a fee waiver is granted by the Des Moines Bankruptcy Court, requests from people on fixed incomes, who receive public assistance, and who are without income are given the highest priority. If you do not qualify to waive the filing fee altogether, you can ask for an installment plan for the fee when filing bankruptcy in Des Moines.
Print Your Bankruptcy Forms
Once you have completed the packet, do a careful review to make sure that you have not made any mistakes or forgotten to provide any information. After you are certain your bankruptcy forms are properly filled out, print out a copy for you and one for the Bankruptcy Court Clerk. If you don’t have a good printer that can easily print two copies of the forms, consider what alternatives you have. For example, the Des Moines Public Library will let you submit your request from home and just stop by to pick up your printed documents. They charge $0.25/page. The Central location is open every day and other locations are open most days except Sunday. You may be able to save money by printing at Drake University, Des Moines University or Des Moines Area Community College if you have access. You also may find savings by printing at FedEx, Staples, Office Depot or another business. Sometimes these businesses even offer coupons. DO NOT try to save money by printing double-sided or shrinking the print size. You must print single-sided on regular size (8.5” x 11’) paper when filing bankruptcy in Des Moines.
Go to Court to File Your Forms
When you file a Chapter 7 bankruptcy in Des Moines, you need to take your forms to the U.S. Bankruptcy Court at 110 E Court Ave #300, Des Moines, Iowa 50309. The courthouse is across the street from the West Riverfront Park, right by the Des Moines River. You can take the Des Moines Metro to the Charles Center Station. If you drive, bring some change in case you have to pay for parking. Also bring exactly $335.00 to pay your filing fee, unless you are requesting to pay in installments or plan to apply for a waiver. To get through the process as quickly as possible, bring a picture identification with you, and leave as many personal items at home or in your car as you can. You will need to clear security because you are entering a federal building. You will go through a metal detector and have your loose items scanned/searched. The less you bring, the easier it will be to get through. Certainly, do not bring any weapons, including pocketknives. The courthouse is open from 8:00 A.M. to 5:00 P.M. except on federal holidays. As you go through security, ask the federal marshals at the door to direct you to the clerk’s office. The Bankruptcy Court for the Southern District of Iowa asks that you review the Guidelines for Communicating with the Court before speaking to anyone in the clerk’s office. Once you are in the clerk’s office, give the clerk your packet. It’s always best to file your Des Moines bankruptcy case in person because the clerk will review everything for simple issues, like a missed signature or forgotten form.
Mail Documents to Your Trustee
Your Chapter 7 Trustee does not work at the courthouse in Des Moines. The Chapter 7 Trustees are not government employees and often have law practices of their own. When you file a Chapter 7 bankruptcy in Des Moines, you may be assigned one of three possible trustees. You should be prepared to submit most recent filed federal tax return to your trustee (some have email addresses set up for just this purpose) and you should watch your mail for any other requests from the Trustee assigned to your case. Make a plan to call the trustee’s office at least 7 days before your 341 Meeting to verify that the trustee has received everything they need from you. Before the 341 meeting, the trustee reviews the documents you provide after filing bankruptcy in Des Moines to verify the information you entered on your paperwork. A delay in providing documents may delay your discharge.
Take Bankruptcy Course 2
Between the day you file your bankruptcy case and 60 days after your 341 Meeting,, you must take the Post-Petition Bankruptcy Course, otherwise your case may be closed before the Court enters your discharge. Taking the course immediately after you file, before your 341 Meeting, helps ensure you don’t forget and that there are no delays in processing your case. This second course, the Post-Petition Bankruptcy Course, takes longer to complete than the first course, about three hours. The purpose of this course is to teach money management skills and how to avoid credit mishaps after filing bankruptcy in Des Moines. Because it takes longer to complete, online courses often allow you to take it in several sessions instead of all at once. You can use any approved company for the course, but many people use the same provider they used to take the first course.
Attend Your 341 Meeting
Often the scariest step in the process of filing bankruptcy in Des Moines is attending the 341 meeting. It will take place approximately 20-40 days after your case is filed, but you will have at least 2 weeks’ notice before the date of the meeting. The meeting will happen at the Federal Building located at 210 Walnut in Des Moines. Prepare for the meeting by dressing in comfortable, but nice, clothing. Park your car at a meter on the street, in the DSM Public Library parking lot, or in any of the parking garages on the sky walk. You should pay for at least an hour of parking to give yourself enough time to get to the building, go through security (leave pocketknives in the car), wait your turn, and complete your meeting. You will need to go to Room 783 and bring your driver’s license/photo ID and proof of social security number (usually, your social security card). Although the 341 Meeting seems very scary, preparing for the meeting is easy and you really don’t need to worry about what will happen at the meeting. If you organize a copy of your bankruptcy packet, your supporting documents, a photo identification, your social security card and updated paystub and bank statement, you should have no problem. The average time a person meets with the Trustee for their Chapter 7 bankruptcy in Des Moines, is 6 minutes. The Trustee may ask you a number of questions that you have to answer honestly and you can watch all of the people who go before you to get an idea of what to expect. Remember, the Trustee is not determining if you qualify to file for bankruptcy and they don’t need to know why you filed. The Trustee is making sure that the information on your Chapter 7 bankruptcy is complete and truthful. Typically, you will spend about an hour from the time you leave your car, until the time you return, when attending your 341 Meeting in Des Moines, Iowa.
Dealing with Your Car
Most people who file Chapter 7 bankruptcy in Des Moines keep their car. Surprised? You are not alone. When filing a Chapter 7 bankruptcy, you get to decide what you want to happen with your car by making an “election.” There are three elections you can make:
Reaffirm the loan (sign a contract saying you will keep paying).
Redeem the property by paying the lender what the car is worth, in full.
Surrender your car and give it to the lender.
The Bankruptcy Court typically must approve your request to redeem or reaffirm. If you are reaffirming, the lender will send you a reaffirmation agreement which you must sign and submit to the Des Moines Bankruptcy Court for approval by the judge. A redemption will usually need the Court’s approval if you are paying more than $1,000.00. Redemptions are usually done only if the car is worth much less than what is owed (it’s “underwater”). For example, if the car is worth $2,200.00 but the loan on the car is for $7,800.00, a person may want to redeem that car. If the payments on the car are more than you can afford or if you no longer need the vehicle, you may want to surrender it. Carefully consider what decision you want to make in your Iowa bankruptcy because it really is up to you.
Iowa Bankruptcy Means Test, Bankruptcy Forms, and Exemptions for Des Moines
Iowa Means Test
One of the first considerations in whether you can, or should, file a Chapter 7 bankruptcy in Des Moines, is the Means Test. The Means Test takes your family’s income, size, and day-to-day expenses and applies a formula to determine whether there is a “presumption of abuse.” A presumption of abuse, does not mean that you have done anything wrong or that you can’t file a bankruptcy in Des Moines. The presumption of abuse just shows that the Iowa bankruptcy Means Test indicates you may earn too much money to file a Chapter 7 bankruptcy. If there is a presumption of abuse, complete Official Form 122A-a of the Chapter 7 Means Test Calculation to show that you overcome the presumption of abuse because you don’t have any money left after paying allowed expenses. If this second part of the Iowa bankruptcy Means Test shows that you don’t have any money to pay your creditors, you pass the Means Test and can file Chapter 7 bankruptcy in Des Moines. Report your Means Test results on Official Form 122A-1, Part 2, Line 14.
Median Income Levels for Iowa
Iowa Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
|Household Size||Monthly Income||Annual Income|
Poverty Levels for Iowa
Iowa Fee Waiver Eligibility for Cases Filed On or After May 1, 2020
Eligible for fee waiver when under 150% the poverty level.
|Household Size||State Poverty Level||Fee Waiver Limit (150% PL)|
Iowa Bankruptcy Forms
When filing Chapter 7 bankruptcy in Des Moines, you have to complete approximately 24 bankruptcy forms, each of which requests a lot of information. Even just listing your property can be overwhelming because we often forget how much we have. Even if you have recently purged everything that does not “spark joy,” listing all of your belongings on Schedule A/B can be daunting. Some people find it easiest if they go room-by-room through their house and others find it easiest to go by category of item. Whatever method you choose, just be thorough and remember that it will be worth it in the end.
When filing Chapter 7 bankruptcy in Des Moines, you must submit a complete list of all creditors with your bankruptcy petition. The list must be typed or prepared on a computer and the Des Moines Bankruptcy Court strongly suggests you use the Consolas font. The list must be formatted in a single column, with a double space between each address.
Even just looking at the list of Des Moines, Iowa bankruptcy forms, can be intimidating. The Des Moines Bankruptcy Court also wants to be sure you are aware of the Judge’s Opinions and knows that you may wish to file without an attorney. There are no local rules of the Bankruptcy Court in Des Moines, so follow the Federal Rules of Bankruptcy Procedure.
You can protect much of your property using the Iowa bankruptcy exemptions. Exemptions are provided by the law to protect all of your most important assets when you file your Des Moines bankruptcy case. The Court wants you to have a “fresh start,” once all of your debt is gone and the Chapter 7 bankruptcy exemptions permit you to have enough so you can rebuild on firm footing. The amount of equity in an asset determines whether it can be protected. The exemptions provided when filing a Chapter 7 bankruptcy in Des Moines are broad, which is nice because you are not permitted to use federal bankruptcy exemptions when filing bankruptcy in Des Moines.