What to know about bankruptcy schedules

On Behalf of | Nov 10, 2021 | Chapter 13 Bankruptcy, Chapter 7 Bankruptcy |

Chapter 7 and Chapter 13 are the most common types of personal bankruptcy that are filed in North Carolina. Chapter 7 removes unsecured debts by selling nonexempt property, while Chapter 13 is a repayment plan. However, it involves filling out paperwork and schedules based on income and assets.

Schedules A/B

The filer lists all of their personal and real property on bankruptcy Schedules A/B, which is in two parts. On Part 1, they list all real property, which may include homes, rental properties, businesses, vacation dwellings, condominiums, and duplexes.

Part 2 is for listing personal household goods, such as furniture and appliances, and financial assets, such as bank accounts and stocks. North Carolina allows exemptions for certain types of property that are protected from being liquidated in a Chapter 7 bankruptcy.

Schedule I and J

Schedule I is the form where the consumer lists their employment and all of their income sources, such as investments, outside business interests and others. The filer also must include their spouse’s income, even if they are not filing bankruptcy jointly, unless they are separated.

Schedule J requires the consumer to list all of their expenses, which include rent or mortgage, utilities, and transportation. The total of Schedule J is subtracted from Schedule I to figure disposable income as part of the Means Test. The Means Test compares the filer’s disposable income to that of similar household size to determine eligibility for Chapter 7.

Schedules D and E/F

Schedule D is officially called Creditors Who Have Claims Secured By Property, which refers to secured debt, such as mortgages. This means if the borrower defaults, the creditor can place a lien on the property used for collateral and seize it.

Secured debts cannot get wiped out in bankruptcy and commonly included with the payment plan in Chapter 13 or from proceeds in Chapter 7. Unsecured debts are listed on form E/F, which means debts without collateral, such as medical bills.