How to Prepare Financials for a Bankruptcy Attorney

Your Complete Guide to Organizing Financial Documents for Student Loan Discharge

At The Independence Law Firm, properly prepared financial documentation can make the difference between discharge success and failure. We’ve streamlined this process through hundreds of cases, and we’ll guide you through exactly what to gather, how to organize it, and why each piece matters for your student loan bankruptcy case.

Why Financial Preparation Matters

The Foundation of Your Case

• Proves undue hardship clearly
• Speeds up filing process
• Strengthens negotiation position
• Reduces legal costs
• Improves discharge odds

What Poor Preparation Costs

• Delayed filing
• Missed opportunities
• Weaker arguments
• Higher fees
• Potential case problems

The Master Document Checklist

Income Documentation (6 Months Minimum)

Employment Income

• □ Pay stubs (every single one)
• □ Year-to-date totals
• □ Employer letters
• □ Commission statements
• □ Bonus documentation
• □ Overtime records

Self-Employment Income

• □ Profit/loss statements
• □ Business bank statements
• □ 1099 forms
• □ Client payment records
• □ Business expense receipts
• □ Quarterly tax payments

Government Benefits

• □ Social Security letters
• □ Disability award letters
• □ Veterans benefits
• □ Unemployment records
• □ Food stamp documentation
• □ Housing assistance

Other Income Sources

• □ Pension statements
• □ Retirement distributions
• □ Alimony/child support
• □ Rental income
• □ Investment income
• □ Side gig earnings

Expense Documentation (Current Monthly)

Housing Costs

• □ Mortgage statements/lease
• □ Property tax bills
• □ Homeowners/renters insurance
• □ HOA fees
• □ Maintenance receipts
• □ Utility bills (all)

Transportation

• □ Car payments
• □ Auto insurance
• □ Registration/taxes
• □ Maintenance records
• □ Gas receipts (1 month)
• □ Public transit costs

Insurance Premiums

• □ Health insurance
• □ Dental/vision
• □ Life insurance
• □ Disability insurance
• □ Prescription plans
• □ Premium statements

Medical Expenses

• □ Doctor visit receipts
• □ Prescription costs
• □ Medical equipment
• □ Therapy costs
• □ Out-of-pocket expenses
• □ Payment plans

Family Expenses

• □ Childcare costs
• □ School expenses
• □ Child support orders
• □ Elder care costs
• □ Special needs expenses
• □ Court orders

Asset Documentation

Bank Accounts

• □ 6 months statements (all accounts)
• □ Current balances
• □ Account types
• □ Joint account info
• □ Closed account records
• □ Safe deposit boxes

Retirement Accounts

• □ 401(k) statements
• □ IRA statements
• □ Pension values
• □ Recent transactions
• □ Loan documentation
• □ Beneficiary info

Real Estate

• □ Deed/title
• □ Recent appraisal/tax assessment
• □ Mortgage balance
• □ Equity documentation
• □ Rental properties
• □ Land ownership

Vehicles

• □ Titles/registrations
• □ Loan balances
• □ Kelly Blue Book values
• □ Condition documentation
• □ Mileage records
• □ Other vehicles (boats, RVs)

Other Assets

• □ Investment accounts
• □ Business interests
• □ Valuable collections
• □ Pending lawsuits
• □ Tax refunds due
• □ Insurance policies

Debt Documentation

Student Loans (Critical)

• □ Federal loan servicer statements
• □ Private loan statements
• □ Original promissory notes
• □ Payment history
• □ Deferment/forbearance records
• □ Default notices
• □ Collection letters
• □ Consolidation documents

Other Debts

• □ Credit card statements
• □ Medical bills
• □ Personal loans
• □ Tax debts
• □ Judgments
• □ Collection accounts

Tax Returns and Related

Required Tax Documents

• □ 2 years federal returns
• □ 2 years state returns
• □ All schedules and attachments
• □ Tax transcripts (if available)
• □ Unfiled return info
• □ Payment arrangements

Special Documentation for Student Loan Discharge

Medical/Disability Evidence

If Claiming Medical Hardship:

• □ Diagnosis documentation
• □ Treatment records
• □ Prognosis statements
• □ Work limitation forms
• □ Medication lists
• □ Future care needs

Disability-Specific:

• □ SSA award letters
• □ VA rating decisions
• □ Worker’s comp records
• □ Long-term disability
• □ Functional capacity evaluations
• □ Doctor support letters

Employment/Career Documentation

Work History Showing:

• □ Job search efforts
• □ Termination letters
• □ Industry decline evidence
• □ Failed business records
• □ Education not yielding income
• □ Age discrimination evidence

Good Faith Evidence

Payment Attempts:

• □ Any payments made
• □ Payment plan attempts
• □ Hardship applications
• □ IDR plan documentation
• □ Communication with servicers
• □ Deferment requests

Organization Tips for Maximum Impact

Digital Organization

Create Folders:

1. Income Proof
2. Monthly Expenses
3. Assets
4. Debts – Student Loans
5. Debts – Other
6. Medical/Disability
7. Tax Returns
8. Special Circumstances

Naming Convention:

• Date_DocumentType_Source
• Example: 2024-01_PayStub_ABCCompany

Physical Organization

If Providing Paper:

• Use tabs for categories
• Chronological order
• Highlight key numbers
• Include summary sheets
• Make copies for yourself

Creating Summaries

Income Summary Sheet:

• Source | Monthly Amount | Documentation
• Job 1 | $3,200 | Pay stubs
• SSDI | $1,100 | Award letter
• Total | $4,300 | See attached

Expense Summary Sheet:

• Category | Monthly | Notes
• Housing | $1,500 | Rent + utilities
• Transport | $600 | Car + insurance
• Medical | $400 | After insurance
• Total | $3,800 | Documented

Common Preparation Mistakes to Avoid

Don’t Hide Anything

• Every asset matters
• All income counts
• Hiding hurts credibility
• Trustees investigate
• Honesty protects you

Don’t Estimate When You Can Document

• Real numbers stronger
• Estimates raise questions
• Documentation wins cases
• Precision shows responsibility
• Judges prefer proof

Don’t Mix Time Periods

• Current expenses only
• Historical income clear
• Future projections separate
• Consistency crucial
• Confusion weakens case

Special Situations

Self-Employed Clients

Additional Needs:

• Business formation documents
• Client contracts
• Expense categorization
• Revenue trends
• Market analysis

Recently Unemployed

Focus On:

• Termination documentation
• Job search records
• Unemployment benefits
• COBRA costs
• Industry prospects

Medical Conditions

Emphasize:

• Diagnosis timeline
• Treatment costs
• Work limitations
• Prognosis documentation
• Insurance gaps

The Financial Story You’re Telling

Your Documents Should Show:

Current Hardship

• Income insufficient
• Expenses reasonable
• No fat to cut
• Already sacrificing

Future Persistence

• Why situation won’t improve
• Age/health factors
• Career limitations
• Family obligations

Good Faith Efforts

• Tried to pay
• Lived responsibly
• Sought solutions
• Made sacrifices

Pre-Meeting Preparation Checklist

One Week Before:

• □ Gather all documents
• □ Create summaries
• □ Review for completeness
• □ Note questions
• □ Update if needed

Night Before:

• □ Organize by category
• □ Bring copies
• □ List missing items
• □ Prepare questions
• □ Get rest

What We Do With Your Financials

Initial Review

• Identify strengths
• Spot issues
• Find missing pieces
• Calculate ratios
• Assess strategy

Case Building

• Create hardship narrative
• Prepare court documents
• Build evidence packets
• Anticipate challenges
• Maximize arguments

Ongoing Use

• Settlement negotiations
• Court presentations
• Trustee responses
• Judge questions
• Appeal preparation

After Your Meeting

We’ll Identify:

• Additional needs
• Documentation gaps
• Strategic improvements
• Timeline for filing
• Success probability

You’ll Receive:

• Clear next steps
• Document requests
• Preparation timeline
• Cost estimates
• Honest assessment

The Bottom Line

Proper financial preparation is the foundation of successful student loan discharge. At The Independence Law Firm, we’ve seen how thorough documentation can transform a questionable case into a winning one.

Start gathering these documents today. The few hours you spend organizing could save you decades of student loan payments.

Contact us when you’re ready. Even partial preparation helps us evaluate your case and guide you toward the complete package needed for discharge success.