In both Oregon and Washington, a bankruptcy petition is really just a “snapshot” in time. This is so because much of the data on your bankruptcy petition is accurate only on the day that your bankruptcy petition is actually filed. The consequences of filing a month later are numerous and substantial. Let’s look at the consequences of filing in July, 2008 rather than June 2008.


To start, your financial data from December must be deleted and June added to the Means Test. This means recalculating the average income for a new 6 month period and recreating the 8 page form 22A or 22C means test. In order to complete this inquiry, new paystubs, P and L statements, and bank statements must be produced. Other sources of income such as interest income, support income, disability, rentals, retirement and so on all must be recalculated.


As if recalculating the income figures were not enough, in completing the test, new amounts for secured debts must now be updated as the balances and arrears may both have changed. In the same vein, new deductions for insurance, taxes and other priority debt must be accounted for again.  Adding insult to injury, the means test is not the only part of the filing process for which delay has lasting repercussions. 


Tax Return: A monthly delay in filing might result in the wrong tax return being supplied. In Oregon and Washington, a one month delay could result in the trustee taking a greatly increased part of your expected tax refund. 


Credit Counseling: A credit counseling certificate has a shelf life of only six months. A delay could result in your having to complete the class all over again. 


Credit Reporting: If you were current on your bills and were going to file without being late, any delay in filing to the following month might put 30 day lates on the credit report, which will now result in a lower credit score  as opposed to having solely a bankruptcy on the credit report and with no lates.


Exemptions: The assets that you keep depend upon where you resided 2 to 2.5 years ago. If the delay in filing changes your exemptions from one state to another, you may only end up protecting significantly less assets.


So failing to file as planned can result in serious consequences as noted above. The typical amount of time spent to update to a new months filing is 2 to 4 hours to the law firm. The time for you to update all the information on the previously prepared bankruptcy and produce records of the same will be several hours and could easily result in additional delays.


The best way to avoid any delay in filing is to produce all documents requested by your attorney and then some. In both Oregon and Washington, our firm requires seven months of pay stubs prior to the date of filing. Provide them and keep providing them at the end of every month until your attorney tells you not to do so any more. Provide six months worth of bank statements prior to filing, if you have them. Make sure that your attorney gets a statement showing the amounts owing, interest rate and monthly payment on every secured loan, be it for home, car, furniture or anything else, regardless of whether you want to keep the property or include it in your bankruptcy.