What Happens After Filing Chapter 7 Bankruptcy?

What Happens After Filing Chapter 7 Bankruptcy
What Happens After Filing Chapter 7 Bankruptcy

Filing for bankruptcy can be a difficult decision to make, but sometimes it is the best way to start anew and regain control of your finances. If you have decided to file for Chapter 7 bankruptcy, it’s important to understand what happens next. Let’s discuss the things that happen after you file for Chapter 7 bankruptcy and how to get help from a Chapter 7 bankruptcy attorney.

An Automatic Stay Will Take Effect

As soon as you file for Chapter 7 bankruptcy, an automatic stay will take effect. This means that creditors are no longer allowed to pursue collection actions against you, such as wage garnishment, foreclosure, or repossession. The automatic stay will remain in effect until your bankruptcy case is discharged, dismissed, or closed.

A Bankruptcy Trustee Will be Assigned to Your Case

When you file for Chapter 7 bankruptcy, a bankruptcy trustee will be assigned to your case. The trustee’s role is to review your assets and debts and ensure that your creditors are paid as much as possible. The trustee will also oversee your bankruptcy case and can take action if they believe there are any discrepancies or fraud.

Any Liens Against Your Property Go Into Effect

If there are any liens against your property, they will go into effect when you file for Chapter 7 bankruptcy. This means that the creditor with the lien will have a secured interest in your property, and if you want to keep the property, you will need to pay the creditor the amount of the lien.

Legal Proceedings Will Continue or Begin for Your Case

Filing for Chapter 7 bankruptcy does not mean that all legal proceedings will come to a halt. If you have any ongoing legal proceedings, they will continue as usual. Additionally, if any new legal proceedings are initiated against you, they will continue as well. However, creditors will not be able to take any collection actions against you during the automatic stay period.

Request a Consultation With Chapter 7 Bankruptcy Attorney The Law Offices of Robert S. Brandt

Navigating the bankruptcy process can be complicated and overwhelming. That’s why it’s important to work with a skilled and experienced bankruptcy attorney like The Law Offices of Robert S. Brandt. I will guide you through the bankruptcy process, explain your options, and help you make informed decisions. If you are considering filing for Chapter 7 bankruptcy in Virginia, don’t hesitate to request a consultation with me today.


This is a follow up to my previous article titled How To Rebuild Your Credit After Bankruptcy. Step one involves ordering your credit report from all three credit bureaus. The information may be correct on the credit report provided by Experian, but incorrect by Expedia for example. And you never know which bureaus a particular creditor relies upon to get their information on you. Hence the need to order and go over all three to ensure accuracy.

How do go about ordering your credit report?

In today’s society just about everything is done online, and while www.annualcreditreport.com is the only legitimate site out there, do not be tempted by the ease and convenience of downloading your credit report from this site. DO NOT ORDER YOUR CREDIT REPORT ONLINE!!! Instead, obtain your credit report the old fashion way by filling out this very simple one page form (which you can find here http://www.consumer.ftc.gov/articles/pdf-0093-annual-report-request-form.pdf) and mail it in. The credit reports will be mailed to you in about two weeks.

Why you should never order your credit report online after your bankruptcy?

Well, that’s because if you do so you will be walking in to the credit bureau’s trap. That trap is called Arbitration. Once online, before you know it, you will inevitably hit “I accept.” As in, in the event that I decide to sue you, the credit bureau, in order to “force you” to fix my credit report after bankruptcy, I will have to take my case before an arbitrator (Latin for referee in case you are wondering) instead of before a judge or a jury. What’s the problem with that? The arbitrator is supposed to be fair and impartial, but he won’t be. Why? Because the bulk of his business and his income comes from the credit bureaus, that’s why.

So again, after at least 60 days have passed since obtaining your bankruptcy discharge the first thing you should do is order your credit reports from all 3 credit bureaus. Just make sure you order your credit report by mail and NOT ONLINE!




You have just received your bankruptcy discharge, and you may be wondering to yourself, now what? How do I go about rebuilding my credit? What steps can I take to improve my credit score? When I researched this topic online virtually all the articles that I read basically emphasized the same thing: Do not incur more debt, pay all your bills on time, and obtain a secured credit card and pay it off in full each month. In fact, here is a good article on this topic Life After Bankruptcy: 5 steps to Rebuilding your Credit, Finances and Emotions, written by Lynnette Khalfani.

There is however one key piece of advice that most news outlets seems to glance over and that is the need to ensure that your credit report is properly reporting your bankruptcy discharge.

All the debt that existed on your credit report on the day you filed your case (regardless whether you were current on the particular obligation, 90 days late, account has been charged off, in collections, etc.) now must be reported by the credit bureaus as “discharged/included in bankruptcy” AND must show a zero balance.

Why is this so important? Because in one of life’s many ironies, a credit report 12 months after a bankruptcy discharge will look better –as in higher credit score- then probably 2/3 of people out there who have not filed for bankruptcy! Why? Because the amount of debt to income ratio, a key component in determining your credit score, looks incredibly good now that you are debt free! Other than student loans, you now have 0 debt, something that not many Americans can say. In addition, the credit score is all about the here and now. It is all about what you have done, or not done, for me lately. As in, a lot more emphasis is placed on the last 12 months of your account activity. And as long as you have not racked up a whole bunch of debt since getting out of bankruptcy things are looking pretty darn good.

So, what you need to do is wait about 60-90 days after the bankruptcy discharge has arrived and then order your credit report from the three major credit bureaus: Transunion, Experian, and Expedia. NOTE: DO NOT ORDER YOUR CREDIT REPORT ONLINE. Then, examine the credit report and make sure that all accounts are now showing “included/discharged in bankruptcy” and showing a “zero balance.” If you would like you can email me your credit report and I will take a look. If one of the accounts is being improperly reported by the credit bureaus then you will need to write a dispute letter to the credit bureau. I can help you with that as well. If that does not get things fixed, then you may have to write one more dispute letter.

Finally, if after a couple of attempts the problem has not been fixed, then you have no choice but to sue them under the Fair Credit Reporting Act. As the name implies, the credit report must be fair in what it depicts and fair means accurate. There is nothing fair or accurate about continuing to report a $5,000.00 credit card balance or showing it as “charged off” or “late” or “in collection” when the debt no longer exists as a result of the bankruptcy discharge. And since asking nicely has not worked, you have no choice but to sue. Notice that the credit bureaus get one or two free bites at the apple…as in, they are not held liable for the initial reporting error, but what gets them is their failure to properly reinvestigate upon being advised of an error.

So forget all the fancy advice out there and start with the basic stuff. Order your credit report and make sure the bankruptcy is properly being reported.