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What is an Emergency Bankruptcy Filing?

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In a Nutshell

People seek an emergency bankruptcy filing when creditors are threatening to take immediate action to seize or sell assets. The emergency bankruptcy filing stops the creditor as soon as you file the main bankruptcy forms.

Written by Attorney John Coble.  
Updated November 30, 2020

An emergency bankruptcy filing is a bankruptcy case filed without all the required forms, usually to stop a collection action that is imminent, such as a foreclosure, repossession or wage garnishment.

The emergency filing triggers protections of the automatic stay, stopping all collections actions, and the filer is given a certain amount of time to submit the rest of their bankruptcy forms to the court. If these deadlines are not met, the case will be dismissed by the court, which ends the automatic stay protection.

Why Do People File Emergency Bankruptcy Cases?

Many people in severe financial distress feel helpless. How would you feel if you were just served with a notice of foreclosure or a wage garnishment notice? Many are paralyzed by the anxiety this causes. After all, these are large companies with many attorneys. How are you supposed to stop them? Some people stick their heads in the sand and do nothing. Sometimes, the person has been working hard on another debt relief solution and is surprised when they are served with a lawsuit or foreclosure notice. They thought they had the problem taken care of and now this. These are the types of situations when emergency bankruptcies are necessary.

What’s Needed for an Emergency Filing?

Even though an emergency filing involves only minimal forms being submitted to the court as part of the initial filing, everyone who seeks bankruptcy relief must meet certain requirements and submit certain information to the court.

Make Sure You Qualify

If you're filing a Chapter 7 bankruptcy, the Bankruptcy Code requires that you pass the means test.  Even if you have passed the means test, you still won’t be able to file a bankruptcy if you don't meet the timing requirements. If you’ve filed bankruptcy in the last 8 years and received a discharge, you’re not eligible to file Chapter 7 and obtain another discharge. The time between cases varies depending on the type of bankruptcy you filed before. Depending on your situation, it may make sense to file a Chapter 13 case even though you’re not yet eligible for a discharge as the automatic stay will still protect you and the Chapter 13 repayment plan can be used to catch up on your payments.

If you didn’t receive a discharge in a prior bankruptcy and it was dismissed within one year of filing the current case, the automatic stay will only be in effect for thirty days after filing. Since the automatic stay is what stops all collection activity, it’s one of the most important bankruptcy protections. You can file a motion with the court to keep the automatic stay going after thirty days, but you must do this immediately after filing. Usually, a hearing will be set and you will have to convince the bankruptcy judge that the automatic stay should stay in effect for your case. If you have filed two or more bankruptcies within the last year, the automatic stay won’t go into effect at all and your bankruptcy filing will not protect you from the emergency that you’re trying to avoid.

Complete the Credit Counseling Course

You must complete your court-approved credit counseling course within six months before filing your bankruptcy. This rule includes emergency bankruptcies. There are very narrow exceptions to this rule. One exception allows a filing without first completing  credit counseling if the filer has been trying to get credit counseling through an approved provider for seven days without success. It's difficult to imagine a situation where such an issue would arise since most of these credit counseling courses are interactive online videos, so do not depend on this exception. Not having had the time to take the course does not fall under this exception. 

Fill Out the Minimum Required Forms

An emergency bankruptcy petition, also called a bare bones petition, must - at a minimum - include the following:

  1. Form 101. This is the first eight pages of any bankruptcy petition.

  2. Your creditor matrix. This is a list of the names and addresses of all your creditors.

  3. Form 121. This is your statement of social security number.

To complete Form 101, you only need your most basic personal information. This form is titled “Voluntary Petition.” This information includes your name, address, and whether this is a joint filing with your spouse. There are checkboxes for estimates of how many creditors you have, the total value of your assets, and your total debt. You must list any bankruptcies you have filed within the last eight years.  There are a few other basic questions. Part 5 is the part of Form 101 where you certify under penalty of perjury your situation involving credit counseling. Do not make the mistake of thinking this allows you to take the course after filing. It does not. It allows you to file a certificate later, but the certificate must show that you took the course before filing. Other parts of Part 5 shows possible exceptions to the credit counseling requirement.

Your creditor matrix is your list of creditors along with their addresses. Form 121 is a form that shows your social security number. The bankruptcy court's computer system keeps this form so secure that even your attorney can't retrieve it again.

If you are untruthful when filling out these forms, you could face criminal prosecution. If you're inaccurate when filling out these forms, you may have to explain yourself to the satisfaction of the bankruptcy court.

File the Case & Pay Your Fee

You usually pay your filing fee at the same time you file your Chapter 7 bankruptcy. There are provisions to allow the filing fee to be paid in installments or to be waived completely. Your fee can be waived if you earn less than 150% of the federal poverty guidelines and the court determines that you can’t afford to pay the fee. The courts only waive the fee in the most extreme cases. If a fee waiver isn’t approved by the court, you must pay the fee or the court will dismiss your case.

With an emergency bankruptcy filing, it will be necessary for you to file in person to avoid the delay from mailing the petition in. Use the federal court system’s court locator to find your court. This locator will show a list of federal courts in your area. Make sure to choose the bankruptcy court only. In addition to information on where to go to file your case and other important information you should know, the website should have a phone number and other contact information for the court.  If you’re not sure if it’s the right court location for you based on your zip code, call the court to make sure you will be filing at the right place before going there. 

I’ve Filed My Emergency Bankruptcy. Now What?

There are a few things you need to do after you have filed your emergency petition at the clerk's office. First, you need to make sure you know your case number. Then, you need to call the creditor that caused you to file the emergency petition. If you were concerned about a repossession, this would be the car loan company. If you were concerned about a foreclosure or wage garnishment, it would be the mortgage company or the company that sued you, respectively. Tell the creditor you have filed bankruptcy and give them your case number. This lets the creditor know the automatic stay is in place and they have to stop all collections actions. These creditors will eventually get notice of your bankruptcy through the bankruptcy court's electronic noticing system or by mail. But, that can take a few days, so you don’t want to wait for the court to notify the creditor. You need to do it as soon as possible after you file.

The next concern when filing an emergency petition is the deficiency notice you will receive. This notice will let you know that you have 14 days to file the rest of the bankruptcy petition or your case may be dismissed. Look at these forms to figure out what you need, then create a plan of action to get all the required materials together before the deadline. Make sure to look for any mailed or electronic notices you get from the bankruptcy court or the bankruptcy trustee. You will receive important information about the date, time, and location of your meeting of creditors.

What Other Forms Do I Have to File and How Soon Does This Have to Be Done?

The rest of the required forms include but aren’t limited to Schedule A/B lists all the property you own, including real estate. Schedule C is how you plan to allocate your available exemptions. Schedule D is a list of your secured creditors. Schedule E/F is a list of your priority unsecured creditors (back taxes, child support obligations, etc.) and your general unsecured debts (credit cards, medical bills, etc.). Schedule G is a list of any leases you're on and contracts that you are currently bound to. Schedule H is a list of people who are codebtors with you. Schedule I is a calculation of your income. Schedule J is a calculation of your monthly expenses.

Besides these schedules, you also have to complete the forms for the means test. You will have to complete your Statement of Financial Affairs. The Statement of Financial Affairs includes various questions about your finances. For a Chapter 7 bankruptcy case, you will need to complete your Statement of Intention to show what you want to do about your secured debts and your unexpired contracts or leases. In a Chapter 13 bankruptcy, you will need to complete your Chapter 13 plan. Different courts require other forms that you may have to file. You will have to supply some supporting documentation to the court such as some of your most recent paystubs.

After filing an emergency petition, you only have 14 days to submit most of these forms to the court. You must start this process as soon as possible after filing your emergency bankruptcy. If you fail to meet a deadline, the court can dismiss your case, which will automatically terminate the protections of the automatic stay.  

What if I Need More Time?

If you can't get all the paperwork together within 14 days, you can file a motion with the court for more time. Get the forms filed within 14 days. Do not test the court's patience by asking for more time unless you really need it and if you do, make sure you won’t have to ask a second time. Bankruptcy courts, unlike most courts, are designed to move very quickly. Many judges will dismiss your case automatically if you don’t get your required paperwork to the court within 14 days after the filing of the emergency petition.

If your case is dismissed, you can usually file another emergency bankruptcy. Having filed an emergency bankruptcy that was dismissed may be held against you by the judge. This second time, the court will be less patient. Remember that after having one case dismissed in the last year, your automatic stay that stops collection activity will expire thirty days after filing unless you can convince the judge to extend it.

Once you file all required forms with the court, your case will proceed as a normal Chapter 7 case would. You’ll have your creditors’ meeting approximately 1 month after first filing your case.

What Are the Downsides of Filing an Emergency Bankruptcy?

In addition to the stress and anxiety that comes from filing an emergency bankruptcy without being fully prepared to do so, there are some possible downsides you should be aware of.

It May Only Provide Temporary Protection From Your Creditors

Filing an emergency bankruptcy is only a temporary stop in a foreclosure, repossession, or eviction. For a permanent stop of these collection actions, you must cure your default. In Chapter 7 bankruptcies, the default must be cured very quickly. In a Chapter 13 bankruptcy, you can cure your default over the thirty-six to sixty-month plan. If you filed to stop an eviction, you only have thirty days to cure the default regardless of which type of bankruptcy you’ve filed.

It May Put Your Property at Risk

Everything you own is part of the bankruptcy estate from the time you file the case. It makes no difference that you have filed an emergency bankruptcy. Since you filed on an emergency basis, you probably didn't have time to figure out if you had enough exemptions to cover all your property. You may lose things, including funds in your bank account and tax refunds for this reason. You need to consider this risk before filing an emergency bankruptcy.

There May Be Other Unintended Consequences

The date you file your case whether it's an emergency or not, determines many things, including whether the trustee can ask your family member to give back the money you repaid them last year. Filing an emergency petition without first carefully reviewing all of the requested information means you won’t know what might be an issue in your case until it’s too late and most courts won’t allow filers to voluntarily dismiss their case.

Can Upsolve Help With an Emergency Filing?

Upsolve can’t help you with an emergency filing. First, Upsolve's software generates a full petition. It can't generate a partial petition. Second, with all the rolling deadlines that go with an emergency bankruptcy filing, it’s best to have a bankruptcy lawyer representing you, although you don’t have to hire an attorney if you can’t afford to.  If you don’t have to file immediately and qualify to use our app, Upsolve is happy to help you file a full Chapter 7.

Written By:

Attorney John Coble


John Coble has practiced as both a CPA and an Attorney. John's legal specialties were tax law and bankruptcy law. Before starting his own firm, John worked for law offices, accounting firms, and one of America's largest banks. John handled almost 1,500 bankruptcy cases in the eig... read more about Attorney John Coble

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