Written by the Upsolve Team.
Updated November 24, 2019
The people of Vermont are hard-working and through that hard work have established themselves as the number one maple syrup producer in the country. However, some residents of the Green Mountain State fall on hard times and need help no matter their work ethic. An unexpected event can put people and even well-funded companies in situations where bankruptcy becomes the solution for their struggle to make ends meet. In 2018, Vermont-based Shark Tank funded company Butcher Block filed for bankruptcy. No matter the reason, if people find themselves in financial distress, filing a Bennington bankruptcy can often be a way to get a fresh financial start. Debtors can get different types and levels of relief through alternative solutions and different chapters of Vermont bankruptcy, and in some cases these are better options than pursuing Chapter 7 bankruptcy in Bennington. Chapter 7 bankruptcy wipes out most or all debts, but not everyone qualifies for this level of help.
Though it can seem overwhelming and stressful to go through a Bennington bankruptcy, the process can usually be done in 4 months when not much property is involved – and the majority of people filing can actually keep everything they own! Also, since finances are already a worry, if you’re filing for bankruptcy you can complete the process yourself without hiring a lawyer or seek help from legal aid groups or Upsolve.
Bennington Bankruptcy Lawyers – Estimated Costs
Even though hiring a lawyer to handle your Bennington bankruptcy isn’t required, it can be a good investment if you can afford one – especially if your situation is complicated. If you’re not sure whether you need to hire an attorney, many bankruptcy lawyers will have a free initial consultation with you so you can discuss your options and make the right choice for your situation. The cost of a bankruptcy lawyer in Vermont usually runs between $1,100 and $1,200. Though it may seem like a large amount of money, especially when money is tight, completing your forms, filing your bankruptcy petition, and attending your mandatory 341 Meeting with you are all usually part of the Bennington bankruptcy lawyer cost. However, if you decide you can’t or don’t want to hire a lawyer but don’t want to go it alone, Upsolve may be able to help you.
How to File Bankruptcy in Bennington, Vermont for Free
One of the biggest concerns for people in the Green Mountain State is how much their Vermont bankruptcy will cost. This is not surprising because people don’t file bankruptcy if they don’t have financial issues. Normally, there is a $335 fee for filing Chapter 7 bankruptcy in Bennington, there are solutions for people whose household income falls below a certain level that can break up or even eliminate that cost. The point is that no one should be denied the benefit of bankruptcy discharge (elimination of debts) just because they can’t pay the required fee.
Collect Your Bennington Bankruptcy Documents
When figuring out how to file bankruptcy in Bennington, take enough time to collect your Bennington bankruptcy documents first. There are many documents you’ll need to complete the forms properly and show the Court a full picture of your finances. You should start by getting your 2 most recent tax returns, which you can get from the IRS, as well as a copy of your credit report from any of the three major reporting agencies (you can get one free copy of your report every year). These will help show your income, your debts, and the names and addresses of your creditors so the Court can notify them you are filing bankruptcy. Collect all your bill collection notices from the last 90 days as well, because recent debts may not show up on your credit report yet. You also need proof of income or paycheck stubs for the last 6 months. If possible, get copies of anything else showing income such as bank statements, as well as any documents you may have received from creditors taking legal action to garnish wages, foreclose, or sue you.
Take Credit Counseling
In order to file your Bennington bankruptcy, you have to take a credit counseling course that explains alternatives to bankruptcy and goes over your finances with you. A copy of the completion certificate from that course has to be filed along with your bankruptcy paperwork. You can’t take the class more than 6 months before filing bankruptcy in Bennington, and when you do take it, it must be an approved credit counseling course. You can take this course over the phone or online in Vermont, but there are no brick and mortar locations in the state. The course normally takes less than 2 hours to complete and there is usually a small fee involved – between $10 and $50.
Complete the Bankruptcy Forms
Now it’s time to put all the documents you collected earlier to work as you fill out the forms required for Chapter 7 bankruptcy in Bennington. Vermont bankruptcy laws require nearly 2 dozen forms be completed to start your case with the Court, but they are available online and you can download them for free. Normally, if you have an attorney you are working with, they will complete the forms for you. If you are working alone, the government created a lengthy instruction manual to help you complete the forms. If you aren’t comfortable with filling out the forms yourself but were financially unable to hire a lawyer, look at Upsolve’s screener to see if you are eligible to receive free help with your forms.
Get Your Filing Fee
Normally, it costs $335 in exact cash, cashier’s check, or money order when you file your Bennington bankruptcy case in Court. The feel is usually due in full, but if paying a lump sum is a problem for you, compete this application to see if your income is low enough to qualify for a fee waiver. The Court will review your application and either tell you that your filing fee is waived, or else order you to pay the fee in up to 4 installments. If, however, you know you won’t be eligible for a fee waiver but will still struggle to come up with $335 at one time, you can ask the Court to let you make up to 4 installment payments within 120 days of filing your case. However, if you are allowed to make installment payments be sure to make them on time or else the Court may throw out your Vermont bankruptcy case.
Print Your Bankruptcy Forms
Once your forms are completed, it’s time to print them and get ready to file your Vermont bankruptcy. When filing bankruptcy in Bennington, you need to print one single-sided copy of all your forms for the Court at home, at someone else’s home, at your local library, or at a print shop. Even though it’s a legal proceeding, the Court will accept your documents on 8.5” x 11” paper. If you are working with Upsolve, you’ll receive an email with the completed forms as a PDF file so you can print them all together. Otherwise, it’s a good idea to have a checklist so you can be sure all the forms get printed and your filing will be complete. Make a second copy of the forms for your own records if possible, and make sure you sign all the forms you are turning in to the Court or they may be rejected.
Go to Court to File Your Forms
Your next step is bringing your completed, signed forms and your filing fee or waiver application to the Vermont Bankruptcy Court located in Burlington. Though there is a second location in Rutland, they do not accept in-person filings. If you can’t make it to the Court in person, you can mail in your documents and the fee (but only a money order or cashier’s check) to either Court location. Filing in person is better, if possible, because you can make sure you have done everything correctly and your Bennington bankruptcy case will be filed that day. Expect to pass through security screening and show your government ID when you enter the Court, then find the Court Clerk’s office. Let them know you want to file bankruptcy and give them your forms and the fee or fee waiver. They will process your case, which shouldn’t take more than 15 minutes or so, but in case they are busy you should plan on getting there well before the Court’s 5:00 p.m. closing time. After your forms are processed, the Clerk should give you your bankruptcy case number, the contact information for your case’s Trustee, and the time, date, and location for your 341 Meeting. Keep this important information safe, and you can now leave the courthouse and breathe a sigh of relief that you’ve filed your Vermont bankruptcy successfully!
Mail Documents to Your Trustee
Your bankruptcy Trustee is supposed to oversee your Bennington bankruptcy case, make sure you are playing by the rules and not trying to hide assets, review all your financial documents, and run the 341 or “Creditors’ Meeting.” As a Court appointed official, you should cooperate with them and respond quickly and completely when they request information such as bank statements or paycheck stubs. Failing to do so can cause the Trustee to recommend you not be granted a discharge of your debts by the Court. Also, even though they may not request it, not less than 7 days before you have your 341 Meeting you need to send your Trustee your most recent tax return.
Take Bankruptcy Course 2
When filing bankruptcy in Bennington, you have to take not one but two courses to receive your discharge. The first was our credit counseling course you took before filing your case with the Court, and the second is a financial management course you need to complete to get a discharge of your debts. Like the first course, the second must be taken with an approved company online or over the phone and is meant to teach you about making smart financial choices. If the company doesn’t file your certificate of completion with the Court for you, you must do it yourself. There is usually a small cost associated with the course, but none will cost more than $50. The course shouldn’t take more than 2 hours, but it’s important you bite the bullet and get it over with early – the longer you wait to take the Court, the longer it will take to receive your Vermont bankruptcy discharge.
Attend Your 341 Meeting
Your Chapter 7 bankruptcy in Bennington is almost done when you attend your creditors’ meeting! Usually, the meeting will only include you, your attorney if you decided to hire one, and your Trustee. Though creditors are invited, they almost never show up to the meeting. The meeting is meant to make sure they have all the information they need to evaluate your case and ask you any remaining questions they may have about your documents or anything that doesn’t add up on your forms. It’s easy to prepare for the meeting, and as long as your show up to your meeting on time with appropriate documents to verify your identity and social security number and a copy of all the documents you’ve submitted for your Bennington bankruptcy, you have done most of the hard work. You will be under oath, so answer the Trustee’s questions truthfully.
Dealing with Your Car
In a Chapter 7 bankruptcy in Bennington, a car is an asset many people worry they cannot keep. If your car is worth less than the Vermont or federal exemptions – depending which one you choose – you can keep it. If the car is more valuable than the exemption limit, it can be sold, and the extra value given to creditors to pay down what you owe. If you are still paying a car loan, you must be able to pay for the car to keep it. Otherwise you can surrender the car to the lender and walk away from whatever you still owe on it. If you want to keep the car and can make the current monthly payment without a problem, you and the lender can enter a reaffirmation agreement where you continue paying as you did before your Vermont bankruptcy until the loan balance is paid in full. If your car is worth much less than your outstanding loan balance, and you can afford a single payment, you can pay the car’s current value (instead of the loan value) all at once to redeem the vehicle.
Vermont Bankruptcy Means Test, Bankruptcy Forms, and Exemptions for Bennington
Vermont Means Test
Before you can file your Chapter 7 bankruptcy in Bennington, you must make sure you can pass the Vermont bankruptcy Means Test so you are eligible to file for this type of relief. The reason there is an income limit for Chapter 7 filers is to prevent abuse of the system by people who can actually afford to work towards paying their debts. You can also use Upsolve’s Chapter 7 Means Test calculator to quickly evaluate whether or not you may be able to qualify. Even if your income is above the allowed limit, if the Means Test indicates you cannot pay your creditors, you may be eligible to file Chapter 7 bankruptcy.
Median Income Levels for Vermont
Vermont Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
|Household Size||Monthly Income||Annual Income|
Poverty Levels for Vermont
Vermont Fee Waiver Eligibility for Cases Filed On or After May 1, 2020
Eligible for fee waiver when under 150% the poverty level.
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Vermont Bankruptcy Forms
Vermont uses the same federal bankruptcy forms that any other state can choose to use, so anyone filing Chapter 7 bankruptcy in Bennington must use these forms. However, Vermont also created some additional Vermont bankruptcy forms, you can find and download for free on the Court’s website. Most of the forms are only used in certain situations, but everyone filing a Bennington bankruptcy must turn in a Payment Advices Cover Sheet, known as a Local Form B, with their other forms and their paycheck stubs.
Bankruptcy exemption laws protect different categories of assets – your property – from being sold by creditors to pay your debts. When filing bankruptcy in Bennington you are allowed to choose between federal bankruptcy exemptions and Vermont bankruptcy exemptions as long as you have been a resident of the Green Mountain State at the 2 year prior to filing your bankruptcy petition with the court. Depending on your situation, one set of exemptions may benefit you more than the other, but you cannot use both.