Five Reasons the Court May Dismiss Your Bankruptcy Case

Filing for bankruptcy comes with a fair share of complexities. For many individuals, filing for bankruptcy means a chance to start over, relieve themselves of burdensome debt, and regain financial control.

However, getting a discharge of your debt may not be as easy as you think. When filing for bankruptcy, there is a chance that your case could be dismissed. There are several reasons the court may dismiss your bankruptcy case. With the help of an attorney, you can improve your chances of a successful outcome when seeking debt relief. Our Bay Area bankruptcy attorney can guide you throughout the process of filing for bankruptcy and help you avoid mistakes.

What is a Dismissal in Bankruptcy?

A dismissal happens when a bankruptcy court terminates your case without discharging your debt. The court may dismiss your bankruptcy case due to various reasons. Having your bankruptcy case dismissed means you lose the benefits of bankruptcy protection, and creditors can resume their collection activities against you. In some cases, a dismissed bankruptcy case can negatively impact your credit score and future bankruptcy filings.

Reason #1: You Failed the Means Test

One of the requirements for filing bankruptcy is passing the means test, which helps to determine if you qualify for Chapter 7 or Chapter 13 bankruptcy. If your income exceeds the median income in your state, you must pass a second means test that considers your expenses and disposable income. If you fail to pass either the first or second means test, the court may dismiss your bankruptcy case.

Reason #2: You Did Not Complete the Mandatory Education Courses

Before filing for bankruptcy, you must complete a mandatory credit counseling session from an approved provider. This session helps you evaluate your financial situation and explore your options. After filing, you must complete a debtor education course that focuses on budgeting and financial management. Failure to complete these mandatory education courses can lead to the dismissal of your bankruptcy case.

Reason #3: You Did Not Attend Your Meeting of Creditors

After filing for bankruptcy, you must attend a meeting of creditors, also known as a 341 hearing. The trustee, creditors, and your attorney will ask you questions about your financial affairs, income, and assets. Failing to attend this meeting can lead to the dismissal of your bankruptcy case.

Reason #4: You Failed to File Required Forms

Filing for bankruptcy requires completing numerous forms and providing detailed financial information. Missing required forms or filing them incorrectly can lead to the delay or dismissal of your bankruptcy case. The judicial system views filing for bankruptcy as a serious legal process, and attention to detail is crucial.

Reason #5: You Committed Bankruptcy Fraud

Intentionally misleading the court or hiding assets are forms of bankruptcy fraud that can have severe consequences. Bankruptcy fraud can result in your case being dismissed, and you may face criminal charges. It is crucial to disclose all your assets and debts, including any transfers or transactions made within the last year before filing.

Fact: According to the Legal Information Institute, bankruptcy fraud is punishable by up to five years in prison and a maximum fine of $250,000.

Get Assistance From a Bankruptcy Attorney

Filing for bankruptcy is a serious legal process that requires careful attention to detail and compliance with various requirements. Failure to meet these requirements can lead to the dismissal of your bankruptcy case, a potential loss of bankruptcy protection, and a resumption of creditor collection activities. It is crucial to work with a bankruptcy attorney to guide you through the filing process and minimize the chances of getting your bankruptcy case dismissed. Contact the Law Offices of Melanie Tavare to get assistance in filing for bankruptcy. Set up a free consultation by calling 510-255-4646.