How to File for Bankruptcy in Washington

Throughout the United States, the number of bankruptcies is rising along with continually increasing consumer credit spending and a nationwide economic slump. Washington has fared reasonably well, standing near the middle of all states in bankruptcies per capita in 2007. These laws were first instituted by the federal government, but have since been altered or added to by states, such as Washington, across the country. When bankruptcy is imminent, there are many issues to be determined even before filing.

Finding a Bankruptcy Attorney

Before filing for bankruptcy, one must determine the type of bankruptcy they wish to file for. By far the most common options are Chapter 7, Chapter 11 and Chapter 13. This procedure can be greatly assisted by a bankruptcy attorney. They are skilled in assessing financial situations, and will aid the entire bankruptcy process afterwards. Finding the right attorney is best attempted with personal or business referrals, but there are many simple online services to provide additional help and information.

Bankruptcy Options

Of the three commonly filed bankruptcy options, Chapter 7 is by far the most common, but a debtor’s attorney can determine which choice is truly appropriate for their circumstances.

• Chapter 7 can provide a fresh start for many debtors, by removing most debts. However, this relief comes at the price of all of their property, aside from exemptions, which is used to repay debtors as much as possible.
• Chapter 13 provides organizational relief to debtors by the creation of a 3 to 5 year repayment plan in which the debtor uses their existing income to repay their debts in full, while keeping all of their property.
• Chapter 11 provides a very similar procedure to Chapter 13 bankruptcy. However, the exact regulations are shaped to aid businesses specifically, allowing them to continue their operations and gain revenue throughout the bankruptcy.

Washington Exemptions

Washington, as many other states, allows the option of either the federally mandated exemptions or the state specific exemptions from Washington state law, which are:

Filing the Petition

When a decision is reached on the most effective mode of bankruptcy, a petition must be filed to the bankruptcy court. To file a petition, all of a debtors possessions must be inventoried. For those filing for Chapter 7 bankruptcy, this must be a meticulous process in order to avoid bankruptcy fraud, and a “means test” must also be passed in order to gain access to Chapter 7. A response is received, generally, in 20 to 40 days, and if successful, creditors will be notified immediately. The following meeting between a bankruptcy trustee, the debtor and their creditors, where for those filing for Chapter 13 bankruptcy, a repayment plan is arranged. This is the most important aspect of the bankruptcy process for Chapter 13 filers, aside from completion of the arranged plan.