The Importance of a 3 Source Credit Report Before You File Bankruptcy

Know Who Owns Your Debt

It will cost you several thousand dollars to file bankruptcy, so why would you jeopardize the success of your bankruptcy to save $50?  A good 3 source credit report will cost you about $30 to $50; not much  money compared to the $306 chapter 7 filing fee or several hundred dollar attorney fee.  By obtaining a 3 source credit report you will know who owns your debt, how much you owe them, and the last 4 digits of the account number relating to each debt.  If you look at Schedule F you will understand that this information is incredibly helpful.

The Dangers of an Emergency Bankruptcy Filing

Filing An Emergency Bankruptcy Petition Is Not Without Danger

So you're facing a lawsuit, wage garnishment, foreclosure, or any other imminent collection event that prompts you to contact a bankruptcy attorney.  After a brief consultation the attorney tells you that he can file a bankruptcy petition with the court right away, and that by doing so your collection event will stop immediately.  This power of the automatic stay coupled with the attorney's low fee sounds great, so you file an emergency bankruptcy petition.

Now the clock is ticking...

Filing this bare bones petition is the easy part.  Now you have 2 weeks to file the remaining schedules, statements, and required documents.  This means that you have about 1 week to give the attorney 6 months of pay stubs, 2 years of tax returns, 6 months of bank statements, and any other document the attorney requests.  Furthermore, depending on the bankruptcy attorney you may need to complete a 30-40 page bankruptcy workbook.  If you can't get these documents to the attorney quickly enough he won't have time to draft the outstanding schedules, statements, and required documents.  In that event, your case will be dismissed.

In brief, an emergency bankruptcy filing gives you a brief window of time to furnish a large amount of documentation.  Likewise, the attorney is under time pressure to draft your outstanding documents and file them with the court within the 2 week period.  Therefore, emergency bankruptcy filings are by no means easy; they require close communication and fast action by the attorney and client.