In the News: The Government Shutdown and Bankruptcy Court

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In the News: The Government Shutdown and Bankruptcy Court

It’s been nearly a month since the latest government shutdown began. Bankruptcy cases are federal cases, which means the shutdown is already having an impact on Americans filing Chapter 7 or Chapter 13.

Bankruptcy courts remain open at the moment, but already cases are severely delayed. They were already overburdened, and now they are having to reduce operations. And they could close in the future if the shutdown continues to drag on.

Court funding could run out on January 25, or even early February. This is an extension of funding which initially would have run out on today’s date, January 18th.

It’s hard to make predictions about what will happen either in Pennsylvania or New Jersey. Bankruptcy courts will be making decisions about how to proceed on a court-by-court basis.

We can tell you what’s happening right now.

At the moment, the Western District of Pennsylvania continues to accept filings, the Middle District of Pennsylvania is taking steps to minimize the chaos, and the Eastern District doesn’t seem to have posted any new information on their website.

The United States Bankruptcy Court District of New Jersey is operating on court fees and other funds that don’t rely on the Federal Government.

What does all this mean to you?

  1. If you need to file for bankruptcy you still can.
  2. In fact, if you are sure you need to file for bankruptcy it’s a good idea not to wait, so you can get your automatic stay in place in case the shutdown continues long enough to temporarily close bankruptcy courts, which could happen for all civil federal cases. Delaying wasn’t a good idea before, but it’s an even worse idea now.
  3. Once you’ve filed you should expect delays. Your court date, 341 hearings, meetings with the trustee and eventual discharge will probably take more time than you’d like.

Making sure you do absolutely everything right during this time is critical. This is not a time when you want to file a bunch of corrections or fight against case dismissal.

Now, more than ever, you need the help of an experienced bankruptcy attorney. Your bankruptcy case probably isn’t as simple as you think it is, especially now. Don’t try to go it alone. We offer payment plans to help bankruptcy filers, so don’t let a fear of legal fees stop you from taking this step.

Get all your paperwork together. Schedule a free consultation with us. We’re here to help protect you, to the fullest extent law and circumstance will allow.


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