Written by the Upsolve Team.
Updated December 2, 2019
Even with the best laid plans and saving for a rainy day, unexpected things that drain finances quickly can happen to good people in the Green Mountain State. Even businesses with extensive resources like Springfield Hospital can need help with their debts. Some Vermont residents that find themselves in trouble can use a Burlington bankruptcy to get a fresh financial start. Filing bankruptcy in Burlington is a great way for hard working but unlucky residents to get help with their debts and change the course of their financial future. Everyone is different, so you need to decide which type of bankruptcy is best in your situation. The most immediate relief comes from Chapter 7 bankruptcy in Burlington because it forgives most or all of a person’s debt in as little as four months. If you are struggling to cover the minimum debt payments and still pay for your basic necessities, a Burlington bankruptcy may be the best way to go. The process can be quick, and because finances are already an issue it can be comforting to know it doesn’t have to cost you a lot of money. You can even complete the process yourself, without an attorney! Let Upsolve walk you through the bankruptcy process for Vermont, tell you what to expect, and explain how to proceed.
Burlington Bankruptcy Lawyers – Estimated Costs
If it’s financially possible for you to hire an attorney to help with your Chapter 7 bankruptcy in Burlington, you may want to consider it if you have concerns about protecting certain property you own. Many bankruptcy lawyers offer free consultations to help you decide if this is the best option for you. The cost of a bankruptcy lawyer in Burlington is usually between $1,100 and $1,200. Usually, the Burlington bankruptcy lawyer cost includes many things – like the lawyer completing the required forms for you, filing your petition with the court to begin your Chapter 7 bankruptcy in Burlington, going with you to the 341 meeting you’ll have with the bankruptcy trustee supervising your case. If you don’t want to go it alone but can’t afford to hire a lawyer, Upsolve can help you complete the process for free, assuming you’re eligible.
How to File Bankruptcy in Burlington, Vermont for Free
As you begin your Vermont bankruptcy, you may be concerned with how much it will cost to file bankruptcy in Burlington. Even though there are usually fees involved, if your income is below 150% of the current federal poverty income guideline you can apply to have the court’s filing fee waived entirely or to pay in installments to avoid causing even more financial stress.
Collect Your Burlington Bankruptcy Documents
When beginning your Burlington bankruptcy, you’ll see very quickly you have a lot of forms to compete. Being able to fill out these forms requires a lot of information from you, so collecting certain documents that contain this information will make your life much easier. A free copy of your credit report from the three major reporting agencies, is easy to get every year and will help a lot in listing all your debts and the addresses of your creditors. You also need the federal tax return you filed most recently, along with every paycheck you have gotten in the 6 months before filing your petition. You may also want to collect documents related to any other things you own, your assets. This can include your vehicle title, recent statements on your bank and investment accounts, or documents reflecting the value of your home.
Take Credit Counseling
As you are learning how to file bankruptcy in Burlington, it’s important to understand that even before you file your Concord bankruptcy petition with the court, you have to complete a credit counseling course. The course usually requires a small fee between $10 and $50, but you can ask for a waiver if your income is below a certain level. The course must be approved by the U.S. Trustee’s Office, but it is easy to find a list of classes you can complete by phone or online. The course can’t be done more than 180 days before you file your bankruptcy petition with the bankruptcy court, but you must include a copy of the completion certificate with all your bankruptcy forms to begin your Vermont bankruptcy case.
Complete the Bankruptcy Forms
If you didn’t hire a Vermont bankruptcy lawyer, you’ll need to complete 24 required forms to give to the court so your case can begin. The forms ask some questions that can seem strange, but it’s only to get a better idea about your finances by learning about your income, your debts, and your expenses. The Burlington bankruptcy forms may seem confusing or overwhelming, but if you aren’t comfortable filling them out yourself, don’t panic – the government has made a set of instructions and there are also ways you may be able to get extra help. You may qualify for help with Upsolve or through another legal aid group. Whatever you decide, make sure the forms are completely and truthfully filled out because you must sign a legal statement swearing to the court that is the case.
Get Your Filing Fee
Usually, someone filing Chapter 7 bankruptcy in Burlington, like the rest of the Green Mountain State, will be asked to pay a $335 filing fee when they submit all their forms to the court. The payment has to be made in exact change or else by either a cashiers’ check or a money order. If your financial situation will make this challenging, you can ask the court to let you pay the fee in up to 4 payments within 120 days or even waive the fee if installment payments will be problematic. The applications will ask about your income, property, expenses, and if you are receiving government assistance. If your income is less than 150% of the federal poverty guidelines for your family size, the court can decide to grant your application for a fee waiver or else it will tell you that you must pay in installments. If you’re told to pay in installments, be sure to make all payments on time – otherwise the court may throw your case out and you won’t get the help you need (or a refund for the amount you already paid).
Print Your Bankruptcy Forms
If you didn’t hire a bankruptcy lawyer, when filing bankruptcy in Burlington you’ll have to give a paper copy your forms to the court. If you are working with Upsolve, you’ll receive a single PDF file with all the completed forms you can print anywhere. The court will need a signed original copy of all required forms. There are a lot of them, but if you are completing the process yourself, the court has made a checklist to help you remember everything! A Vermont bankruptcy case is a legal proceeding, but the court will accept a single-sided copy of your forms on regular 8.5” x 11” paper. In Vermont, you only need one copy of the forms to give the court, but it’s a good idea to print a second copy or make a copy of the first set for your records. Make sure you sign the printed set you are giving to the courts so they will be accepted.
Go to Court to File Your Forms
Filing bankruptcy in Burlington electronically is only available to lawyers, so if you didn’t hire a lawyer you must give your forms to the court by mail or in person. Vermont has bankruptcy court locations in Burlington and Rutland, but only Burlington lets you file your petition in person. Filing in person is safer because you can be sure you completed everything right away and rest assured knowing the court has accepted your documents and filed your case. If you can’t file in person, when you mail your forms you can only pay the filing fee by cashiers’ check or money order (unless you are filing an application for installment payments or fee waiver). If you are going to the Burlington Bankruptcy Court in person, bring your forms and filing fee and be prepared to pass through security when you enter the building. Once the clerk processes your forms (usually in 15 minutes or so), they’ll give you some important information. You’ll receive a case number so you can reference your case, the name of the trustee supervising your case, and information on the date and location of your mandatory 341 Meeting with your trustee. Now take a moment to relax – you just filed your Vermont bankruptcy!
Mail Documents to Your trustee
The court clerk will give you the name of your trustee when you successfully file your Burlington bankruptcy case. This is the court-appointed person who supervises your Vermont bankruptcy case, reviews your documents, runs your 341 Meeting with your creditors, and makes sure all the rules are being followed. Your trustee will contact you by mail with any questions they have or if they need any extra information before your meeting occurs. Even if they don’t have questions, you will still have to send them a copy of your most recent tax return no less than 7 days before the 341 Meeting takes place. Be sure you cooperate with the trustee, because they can ask the court not to grant you a discharge if you are not complying with their requests.
Take Bankruptcy Course 2
Once you successfully file your Burlington bankruptcy, you are not done with your educational requirements. You have to complete a second bankruptcy course and file a certificate of completion with the court (if the company will not file it for you) before you are eligible for release from your debts. Some people get ahead of the game and even complete this requirement before their 341 Meeting takes place! Like the credit counseling course, this second course has to be through an approved provider and completed online or on the phone. This course should last a few hours and is designed to help you make responsible financial decisions in the future so you will not need to file bankruptcy again in the future.
Attend Your 341 Meeting
One of the last parts of your Burlington bankruptcy proceedings is to attend a 341 or creditors’ meeting. You, your lawyer if you have one, the trustee, and any creditors that want to attend will be there, but the people you owe money to almost never show. Even if you have a lawyer, it’s wise to take some time to prepare for the meeting yourself. Review your bankruptcy forms and be sure to bring a copy of the forms you filed with the court to the meeting, as well as copies of any documents the trustee requested. Remember to bring your government issued identification with you, because the trustee can’t begin your meeting without verifying your identity and social security number. Even though you don’t have to wear a suit, you are still going to a court proceeding so it’s wise to dress appropriately. Also, and most importantly, remember to be truthful with the trustee – ask questions if you don’t understand – because you are under oath during the meeting, so lying or “forgetting” information can have serious legal consequences. The 341 Meeting should only take a few minutes, and once it is over you’ll receive a discharge in the mail within a few months.
Dealing with Your Car
One of the major concerns of people filing Chapter 7 bankruptcy in Burlington is if they can keep their car. There are several options for dealing with vehicles. If your car is an asset – something you own outright or have equity in – you can keep it up to the value allowed by either Vermont bankruptcy exemptions or federal bankruptcy exemptions. If the value is over that, the trustee may choose to sell the car, give you the amount you are legally allowed to keep, and give the rest to creditors to pay what you owe. If your car is not paid off, you have three options and must make an “election” to choose one of them. You can surrender or give up the car so you are no longer responsible for the balance left on the loan (however large). If you want to keep the car, depending on your budget, you can either redeem the car by paying the market value of the vehicle in a lump sum or keep making payments as originally agreed under your loan by entering a reaffirmation agreement with the lender to reaffirm the terms of your original loan and pay off the loan balance as agreed.
Vermont Bankruptcy Means Test, Bankruptcy Forms, and Exemptions for Burlington
Vermont Means Test
Even though Chapter 7 bankruptcy in Burlington would be the first choice for most people in debt to change their financial future, not everyone qualifies for this kind of relief. In the Green Mountain State, before filing bankruptcy in Burlington, you must complete a Vermont bankruptcy Means Test to understand if Chapter 7 bankruptcy is available to you. This Meant Test evaluates your income, expenses, and household size to figure out if your income is too high to receive substantial debt forgiveness under Chapter 7. Upsolve also has a Chapter 7 Means Test calculator you can use to learn if you qualify. If you make too much money, remember you can still seek some relief by filing a Chapter 13 bankruptcy to reorganize your debt payments so you can manage them better.
Median Income Levels for Vermont
Vermont Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
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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
Even though the Green Mountain State uses the federal government’s official bankruptcy forms, it has created its own additional Vermont bankruptcy forms you may need to complete and give to the court. Even though most of these state-specific forms are only needed in special situations, everyone filing a Chapter 7 bankruptcy in Burlington needs to complete a form to include with their paycheck stubs and give it to the court at the same time as the other forms you need when you first file bankruptcy.
If you’ve been a resident of the Green Mountain State for at least 2 years, when you’re completing the forms to file a Chapter 7 bankruptcy in Burlington, you can pick between using the federal bankruptcy exemptions or the Vermont bankruptcy exemptions only available to Vermonters. Exemptions are laws that determine different categories of assets you are allowed to keep safe from creditors.