Written by the Upsolve Team.
Updated August 17, 2020
Peoria native Richard Pryor said that he “never met anybody who said when they were a kid, ‘I want to grow up and be a critic.’” Another thing people never wanted to do when they were a kid was to struggle under the weight of debt. However, despite the decreases in Peoria’s unemployment rates, almost three times as many people are unemployed in Peoria than in the rest of the country. If you feel that you are struggling but just can’t make ends meet, you are not alone. If you are tired of the struggle and considering filing bankruptcy in Peoria, rest assured that relief is not beyond your reach. This guide will be your first step to guide you through the process of getting a “fresh start.”
A good place to start is understanding what options are available to you, usually Chapter 7 and Chapter 13. What is best for you will depend on many factors. For example, if you are behind on secured debt, like a car loan or a mortgage, you may want to catch up on your payments through a Chapter 13. A Chapter 13 requires enough income to make a payment, though, and sometimes that is not possible. On the other hand, if most of your debt is unsecured (not attached to any property) and your income is low, you may benefit most by a Chapter 7, which is typically faster and less expensive. A Chapter 7 is favored by people who feel trapped by credit cards, payday loans, and medical bills. Sometimes, the decision is close and you can’t tell what to do. In those cases, you may want to speak to an attorney either through a free initial consultation or by seeking free assistance in your area. If you are going to file a Chapter 7 bankruptcy in Peoria, you can use Upsolve to help you file without an attorney, completing all of the forms from your home, using our straight-forward process.
One of the biggest misconceptions about filing bankruptcy in Peoria is that your credit will be forever ruined. This is simply not the case. Typically, by the time you are even considering bankruptcy, your credit score is not where you want it to be anyway. Once you receive your discharge, you can start rebuilding your credit. That you filed bankruptcy will be reported on your credit report for up to 10 years, but you will immediately be able to improve your credit score by maintaining healthy financial habits.
Peoria Bankruptcy Lawyers - Estimated Cost
A Peoria bankruptcy lawyer will be able to identify and discuss your potential concerns before they become problems. Many attorneys who file Chapter 7 bankruptcies in Peoria offer free consultations where they will briefly review your financial situation to determine if filing bankruptcy in Peoria is right for you. Typically, the bankruptcy lawyer will also discuss any issues that might affect your bankruptcy, like how to protect valuables, what to do with unique debts and how bankruptcy might impact all other areas of your life. For this reason, it may make sense to contact a Peoria bankruptcy lawyer to explore your options.
While consultations are free, the cost of a bankruptcy lawyer in Peoria is usually between $900 and $1,200. While you might believe that the cost of a Peoria bankruptcy lawyer is worth it, it simply may not be affordable to you. You may be able to find assistance through legal aid or arrange payment plans to cover the Peoria bankruptcy lawyer cost. If you’re considering filing Chapter 7 bankruptcy in Peoria, speaking with an experienced bankruptcy attorney who has filed hundreds of cases in Peoria can really put you at ease, even if you end up filing your case on your own.
How to File Bankruptcy in Peoria, Illinois for Free
After arming yourself with knowledge of how to file bankruptcy in Peoria, you CAN file for Chapter 7 bankruptcy in Peoria, Illinois, for free, without hiring an attorney. The very idea of filing Chapter 7 bankruptcy may be scary, let alone figuring how to file bankruptcy in Peoria without an attorney. Even if you file your own Chapter 7, you are not alone in the process. This city guide and Upsolve’s other resources have been carefully created to guide you through the process. Following the steps below will help you file your Peoria bankruptcy.
Collect Your Peoria Bankruptcy Documents
Just as “a stitch in time saves nine,” collecting the necessary documents in preparation for filing bankruptcy in Peoria will set the entire case up for success. To start the Peoria bankruptcy process, review the following list and collect as many documents as you can:
2 years of tax returns (Request a copy online from the IRS)
6 months of paystubs
Details for other income you have, including SSI or unemployment,
Proof of value for property you own, like the tax value of your home
Bank statements for 2-6 months before you file your Peoria bankruptcy
Child Care Expenses
Health Care Expenses
Medical Debt Statements
Credit Card Statements
Student loan records
Credit Report (get a free one at www.annualcreditreport.com)
These documents will help you calculate your income, your monthly living expenses, your debts (both secured and unsecured), and your assets. Remember, when filing a Peoria bankruptcy, your assets include big things you own like your car and your home, but also small things you own like your clothes and your phone. Together, all the documents you collect will reflect your financial situation. If you have documents that are not listed but you think might help show how much you make, how much you spend, what you own and what you owe, gather those, too. Organize all of these documents to help you prepare to file your Chapter 7 bankruptcy in Peoria. If you’re planning to hire a Peoria bankruptcy attorney, or even just go to a free consultation, bringing your organized documents may help you speed up the process.
Take Credit Counseling
The next step to take in preparing in preparing to file a Chapter 7 bankruptcy in Peoria is completing a credit counseling course to help you understand bankruptcy and what your alternatives are. You will need to spend approximately 1 hour and $10 - $50 to take a course from an approved credit counseling agency. You will notice that some of these agencies are located outside of Peoria, Illinois. Don’t worry, you can take the course by phone, online, or in person. When the course is completed, you will receive a certificate. Keep that certificate because you need to file it with your Chapter 7 bankruptcy in Peoria. If your certificate expires, or if you do not have a certificate, your Illinois bankruptcy will not be approved.
Complete the Bankruptcy Forms
Now that you have collected your documents and completed the pre-filing course, you should be well prepared to fill out your bankruptcy forms. Start by reading the instructions provided for filing Chapter 7 bankruptcy in Peoria. You will need to complete many forms, each of which will tell just a bit more about your financial life. By the time you complete approximately 24 forms, the Court will have a full picture of who you are, who you owe, what you spend and what you earn. Upsolve.org’s process guides you through completion of the bankruptcy forms, but you should also read the information provided by the Illinois Bankruptcy Court for people who file bankruptcy in Peoria and follow the Court’s checklist. When you file your Peoria bankruptcy, you have the option of receiving electronic communications about your Chapter 7 bankruptcy from the Court. If you like electronic communications, you can sign up for it by completing the DeBN form. On every form, be VERY careful to be honest and thorough when filing your Chapter 7 bankruptcy forms. Be very careful not to make the mistake that causes headaches for many people who file their own Peoria bankruptcy - missing questions. Answer every question, even if you have to say “not applicable.” Also, be sure to include every form in your completed petition even if it’s blank.
Get Your Filing Fee
When filing a Chapter 7 bankruptcy in Peoria, the Court charges a filing fee of $335. If this fee is unaffordable for you, you have some options. Of course, you could work on saving up to pay it. If you saved $50 each week as you prepare your Peoria bankruptcy forms, you would have the fee saved in under 2 months and be ready to file. If you don’t have 2 months to wait to file or if you simply can’t afford to set the funds aside, then you may be able to qualify for a fee waiver. The Peoria Bankruptcy Court will consider your situation if your income is below 150% of the federal poverty guidelines, to determine if you qualify. If you don’t qualify for a fee waiver, you can request to pay your filing fee in installments due after filing bankruptcy in Peoria.
Print Your Bankruptcy Forms
After you are finished preparing your Peoria bankruptcy forms, you will need to print them as a complete packet to bring to Court. All of your Chapter 7 bankruptcy forms should be printed on only one side of 8.5” x 11” paper in black and white. Review the information on the forms and use Upsolve’s list of bankruptcy forms as a checklist to make sure you have everything you need, including the certificate from the credit counseling company. Make sure you sign everywhere it’s necessary.
If you don’t have a printer at home, you can print your documents at the University of Illinois campus in Peoria for $0.05/page. You could also go to OfficeMax, Staples, or FedEx location to print the documents. Printing two copies will give you one to submit to the Peoria Bankruptcy Court and one to keep for your records of your Chapter 7 bankruptcy filing in Peoria.
Go to Court to File Your Forms
Once your forms are printed and you have reviewed and signed everything, your next step is to file your Illinois bankruptcy case. You must file your forms in the correct Court in Illinois, but you are lucky because for Peoria, Illinois, filing Chapter 7 bankruptcy is just a matter of going downtown to 100 N.E. Monroe Street, right across the street from the Peoria Public Main Library a few blocks up from the Illinois River. Before going to the courthouse, read the Court’s guidelines for communicating with the Court. Bring a photo ID and be prepared to go through security, so make sure you leave pocket knives and any other weapons behind. The Clerk’s office 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 to direct you to the clerk’s office in Room 216.
Mail Documents to Your Trustee
The Court will assign one of twelve trustees to your Chapter 7 bankruptcy in Peoria. Your bankruptcy trustee is neutral - not there to help you or the people to whom you owe money. Although many bankruptcy trustees will communicate with you and let you know what documents you need to provide, the trustee is not someone who represents you. Even if you completed the DeBN form for your Peoria bankruptcy, the trustee will communicate with you by regular mail. Carefully review any communication from your trustee and respond promptly. If you haven’t heard from your trustee at least two weeks before your 341 meeting, call your trustee’s office to make sure you have not missed anything. You may not receive the benefit or your Peoria bankruptcy discharge if you don’t respond to requests by your trustee.
Take Bankruptcy Course 2
Before discharging your debt can be discharged, you need to take a second bankruptcy course from an approved provider. Regardless of what you call this course, budget counseling, pre-discharge counseling, debtor education, etc., it must be completed for you to receive a discharge after filing Chapter 7 bankruptcy in Peoria. You can take this course in person, on the phone, or from your computer. Many people find that this second course helps prepare them for a healthier financial life after their Peoria bankruptcy. The course teaches about saving money, budgeting, and rebuilding your credit. Just like with the course you took before you filed, when the second course is done, you will receive a certificate confirming that you completed this requirement. You will need to file this with the Peoria Bankruptcy Court.
Attend Your 341 Meeting
The 341 meeting is an informal meeting that usually takes less than 10 minutes and with enough preparation, you should not feel anxious about attending. After you file, the Court will send you a notice with the date of your 341 meeting, also known as the meeting of creditors. Most people filing Chapter 7 bankruptcy in Peoria will have their 341 meeting at the 1105 Becker Building, at 401 Main Street, Peoria, IL 61602. You must attend this meeting and should expect it to occur about a month after you filing bankruptcy in Peoria. Although it’s called the “meeting of creditors,” it is very rare that creditors actually attend. If they do, they may ask about the location of the property, like a car, that secures a debt. While creditors don’t usually appear, the trustee will be there and will ask you questions that you should answer honestly. The trustee is not there to determine if you qualify for bankruptcy and you don’t need to convince the trustee that you do. Just be honest and you will find the meeting over more quickly than you expected.
Dealing with Your Car
Generally, having a car in Peoria, Illinois, is a necessity. Even though you can ride a CityLink bus, it is so much easier to drive yourself. Therefore, you may be concerned about how your car is handled in your Chapter 7 bankruptcy in Peoria. One of the first steps is to consider whether you can afford the payment on the car if you have no other debts. If the answer is yes, then think about whether your car has equity (is it worth more than you owe on your loan).
If you can’t afford your car payments and the car is not worth selling, then you may want to surrender your car, giving it back to the lender and eliminating your obligation to pay the debt. If your car is not worth much at all, you could consider redeeming the car. When you redeem a car, you pay the full value of the car all at one time, even if it is less than what is owed to the lender. There are lenders who give loans just for this purpose, but those loans tend to have very high interest rates. Carefully consider whether a redemption will save you money. If you can afford your car payments and you want to keep your car after filing bankruptcy in Peoria, then you can enter into a reaffirmation agreement with the lender. The lender will prepare the agreement, which you then sign and send to the Peoria Bankruptcy Court. Make sure you file the Illinois Bankruptcy Court’s local rules and name the creditor, not the creditor’s representative, on the reaffirmation agreement. Once you reaffirm the debt, the lender treats your loan like you never filed Chapter 7 bankruptcy in Peoria.
Illinois Bankruptcy Means Test, Bankruptcy Forms, and Exemptions for Peoria
Illinois Means Test
Passing the Illinois bankruptcy Means Test is the key to being able to file a Chapter 7 bankruptcy in Peoria. People whose income is lower than the median income for their household size, automatically pass the Means Test. If your income is higher than the median income, you still may be below the income limits and be able to file a Chapter 7 bankruptcy in Peoria. To see if you can still file a Chapter 7 bankruptcy, complete Official Form 122A-a of the Chapter 7 Means Test Calculation. If this second part of the Illinois bankruptcy Means Test shows that you can’t afford to pay your creditors even a small amount, then you can file a Chapter 7 bankruptcy in Peoria. Otherwise, you may need to consider filing a Chapter 13 bankruptcy instead.
Median Income Levels for Illinois
Illinois Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
|Household Size||Monthly Income||Annual Income|
Poverty Levels for Illinois
Illinois 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)|
Illinois Bankruptcy Forms
An Illinois bankruptcy consists of about 24 official national forms. These forms are designed to provide the Court handling your Peoria bankruptcy case a complete picture of your financial situation. Upsolve has provided helpful information about each of these Illinois bankruptcy forms, which are available for free online. Review the forms carefully and make sure you complete each part. For example, Schedule A/B requires that you list all of the property you own. It asks about your home, your car, furniture, household items, stocks, retirement accounts and more. If there is a type of property you don’t own, like stocks, make sure to write “not applicable” or check “none” just to help you make sure you don’t accidentally skip something.
Each state has its own rules about what property a person can protect when filing Chapter 7 bankruptcy. The protected property is exempt from your creditors, meaning they can’t have it no matter how much money you owe them. The value of your property, known in bankruptcy as an asset, is how much you would have after you sell off the property and pay off any loans. This is also known as equity. The Illinois bankruptcy exemptions allow you to protect equity in your home, your car, retirement, and property in your home. When filing bankruptcy in Peoria, you can’t use the federal bankruptcy exemptions.