Coronavirus Affects Bankruptcy Courts Closures for Near Future

Coronavirus Affects Bankruptcy Courts Closures for Near Future

Panic over the spread of Coronavirus has increased drastically in the past few weeks. The Coronavirus has caused major events and organizations to suspend activities, cruise ship passengers are being quarantined, even toilet paper is out of stock at stores due to citizens stockpiling specific items.  

Coronavirus and how it affects bankruptcy

Even the bankruptcy industry is seeing the effects of this pandemic. Arizona 341 Meetings of Creditors held at Bankruptcy Courts that have been scheduled until March 31, 2020 have been postponed. Anyone who has recently filed bankruptcy, or is considering filing soon needs to understand how this will affect a bankruptcy case.

If you have already filed for bankruptcy:

If your bankruptcy case has already been filed and you have a Meeting of the Creditors on the schedule on or before March 31, 2020, that 341 Hearing will be temporarily postponed. While waiting to hear about your new court date, please be patient. Your lawyer likely will not have any information about the new court date. However, as soon as the attorney receives notice of the new court date, he/she should inform you about the new scheduled date and time. Understand that once your bankruptcy petition was filed, an automatic stay of protection did go into effect, preventing any creditor from collecting on your debts. The automatic stay holds until your case is discharged, which is typically around 60 days after the Meeting of Creditors. Therefore, if your 341 Hearing is postponed, the stay will remain in place and protect you until your bankruptcy case is discharged. Having your 341 Hearing postponed also means that the amount of time before you can get an FHA loan will also be delayed. 

If you are considering filing bankruptcy:

Our law firm files bankruptcies electronically, so the Bankruptcy Court’s closing will not affect your ability to file. The 341 Hearing, however, may be scheduled out further than the typical 30-45 days. If you are making any travel plans in the next couple of months, keep this in mind. Because the bankruptcy will be filed with the court, you will still have the automatic stay of protection to stop creditors from collecting debt until the entire bankruptcy is discharged. 

If you have any concerns about how the Coronavirus may affect your specific bankruptcy case, please contact our law firm. The present Coronavirus epidemic is becoming a factor in many life situations. Consult with an experienced Arizona bankruptcy lawyer with any questions you may have regarding and existing or potential bankruptcy.

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