Bankruptcy is a legal process that allows individuals and businesses to eliminate or repay their debts under the protection of the bankruptcy court. It is a complex process that involves several legal and financial considerations. In this post, we will discuss the Oklahoma bankruptcy laws, including the types of bankruptcy, the eligibility criteria, and the bankruptcy process.
Types of Bankruptcy in Oklahoma
In Oklahoma, there are two main types of bankruptcy that individuals and businesses can file for: Chapter 7 and Chapter 13 bankruptcy.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy, also known as liquidation bankruptcy, is the most common type of bankruptcy in Oklahoma. It involves the liquidation of assets to pay off creditors. In this type of bankruptcy, a trustee is appointed to sell the debtor’s non-exempt assets and distribute the proceeds to the creditors. The debtor is allowed to keep certain exempt property, such as a primary residence, personal property, and retirement accounts.
To be eligible for Chapter 7 bankruptcy in Oklahoma, the debtor must pass the means test. This test compares the debtor’s income to the state median income. If the debtor’s income is below the state median income, they are eligible for Chapter 7 bankruptcy. If their income is above the state median income, they may still be eligible if they can demonstrate that they do not have enough disposable income to pay off their debts.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy, also known as reorganization bankruptcy, is a type of bankruptcy that allows individuals with regular income to reorganize their debts and repay them over a period of three to five years. In this type of bankruptcy, the debtor proposes a repayment plan to the court, which outlines how much they will pay each month to their creditors.
To be eligible for Chapter 13 bankruptcy in Oklahoma, the debtor must have a regular source of income and their unsecured debts must be less than $419,275 and secured debts must be less than $1,257,850. The debtor must also complete a credit counseling course before filing for bankruptcy.
The Bankruptcy Process in Oklahoma

The bankruptcy process in Oklahoma involves several steps, including filing the bankruptcy petition, attending the meeting of creditors, completing a debtor education course, and receiving a discharge of debts.
Filing the Bankruptcy Petition
To file for bankruptcy in Oklahoma, the debtor must file a bankruptcy petition with the bankruptcy court. The petition must include detailed information about the debtor’s assets, debts, income, and expenses. The debtor must also provide a list of all their creditors and the amount they owe.
Once the petition is filed, an automatic stay goes into effect, which stops all collection actions by creditors, including lawsuits, wage garnishments, and foreclosure proceedings.
Meeting of Creditors
Approximately four to six weeks after the bankruptcy petition is filed, the debtor must attend a meeting of creditors. This meeting is conducted by the bankruptcy trustee and gives the creditors an opportunity to ask the debtor questions about their financial situation.
Debtor Education Course
Before receiving a discharge of debts, the debtor must complete a debtor education course. This course is designed to teach the debtor how to manage their finances and avoid future financial problems.
Discharge of Debts
The final step in the bankruptcy process is the discharge of debts. This is a court order that eliminates or reduces the debtor’s debts. In Chapter 7 bankruptcy, the discharge usually occurs within four to six months after the petition is filed. In Chapter 13 bankruptcy, the discharge occurs after the debtor has completed their repayment plan.
Exemptions in Oklahoma Bankruptcy
Exemptions are a crucial part of the bankruptcy process as they determine which assets the debtor is allowed to keep and which assets will be sold to pay off creditors. In Oklahoma, debtors can choose between the state exemptions and the federal exemptions when filing for bankruptcy.
Some of the most common exemptions in Oklahoma bankruptcy include:
- Homestead Exemption: Oklahoma allows a homestead exemption of up to $100,000 in value for your primary residence ($200,000 for joint owners).
- Personal Property Exemptions: Oklahoma provides exemptions for personal property such as clothing, furniture, appliances, and necessary household goods, up to certain value limits.
- Vehicle Exemption: Oklahoma allows an exemption of up to $7,500 for one motor vehicle, or up to $15,000 for a vehicle equipped for a disabled debtor.
- Retirement Accounts: Qualified retirement accounts, including 401(k)s, IRAs, and pension plans, are generally exempt from bankruptcy proceedings in Oklahoma.
- Tools of Trade: Certain tools, equipment, or books necessary for your occupation or trade may be exempt up to a certain value.
It is important to note that exemptions can vary depending on the debtor’s circumstances. Therefore, it is essential to consult with a bankruptcy attorney to determine which exemptions apply to your specific situation.
Final Thoughts About Oklahoma Bankruptcy Laws
File bankruptcy can be a complex and overwhelming process, but it can also provide a fresh start for individuals and businesses struggling with debt. Understanding the Oklahoma bankruptcy laws and the types of bankruptcy, eligibility criteria, and the bankruptcy process is crucial for anyone considering filing for bankruptcy.
If you are considering filing for bankruptcy in Oklahoma, it is recommended to consult with an experienced bankruptcy attorney who can guide you through the process and ensure that your rights are protected.
FAQs

What is bankruptcy in Oklahoma?
Bankruptcy is a legal process that allows individuals and businesses to eliminate or restructure their debts under federal law. In Oklahoma, bankruptcy is governed by both federal and state laws.
What are the different types of bankruptcy in Oklahoma?
The main types of bankruptcy in Oklahoma are Chapter 7, Chapter 13, and Chapter 11. Chapter 7 is a liquidation bankruptcy, while Chapter 13 and Chapter 11 are reorganization bankruptcies.
What are the eligibility requirements for filing bankruptcy in Oklahoma?
To file for bankruptcy in Oklahoma, you must meet certain eligibility requirements, including completing a credit counseling course, passing a means test, and having a certain amount of debt.
Will filing for bankruptcy stop collection efforts in Oklahoma?
Yes, filing for bankruptcy in Oklahoma will stop collection efforts, including wage garnishments, lawsuits, and creditor harassment.
How long does bankruptcy stay on your credit report in Oklahoma?
Bankruptcy can stay on your credit report for up to 10 years in Oklahoma.
Can you keep your property if you file for bankruptcy in Oklahoma?
It depends on the type of bankruptcy you file and the exemptions you claim. In Oklahoma, certain property is exempt from bankruptcy and can be kept by the debtor.
Can student loans be discharged in bankruptcy in Oklahoma?
Student loans are generally not dischargeable in bankruptcy in Oklahoma, except in cases of undue hardship.
What debts are dischargeable in bankruptcy in Oklahoma?
Most unsecured debts, such as credit card debt and medical bills, can be discharged in bankruptcy in Oklahoma. However, certain debts, such as taxes and child support, may not be discharged.
How long does the bankruptcy process take in Oklahoma?
The bankruptcy process in Oklahoma can take several months to a year or more, depending on the type of bankruptcy and the complexity of the case.
Do I need an attorney to file for bankruptcy in Oklahoma?
While it is possible to file for bankruptcy without an attorney, it is recommended to consult with a bankruptcy attorney in Oklahoma to ensure that you understand the process and your rights.
Glossary
- Bankruptcy – A legal process that allows individuals or businesses to eliminate or restructure their debts.
- Chapter 7 bankruptcy – A form of bankruptcy that allows individuals to eliminate most or all of their debts and start fresh.
- Chapter 13 bankruptcy – A form of bankruptcy that allows individuals to restructure their debts and repay them over a period of time.
- Exemptions – Certain types of property that are protected from being seized in bankruptcy.
- Means test – A test used to determine if an individual qualifies for Chapter 7 bankruptcy based on their income and expenses.
- Trustee – A court-appointed individual who oversees the bankruptcy process and ensures that creditors are paid as much as possible.
- Automatic stay – A court order that stops creditors from collecting debts during the bankruptcy process.
- Discharge – The elimination of a debtor’s legal obligation to repay certain debts.
- Secured debt – Debt that is backed by collateral, such as a car or house.
- Unsecured debt – Debt that is not backed by collateral, such as credit card debt.
- Priority debt – Debt that must be paid off before other debts in a bankruptcy case, such as taxes or child support.
- Reaffirmation agreement – An agreement between a debtor and a creditor to continue paying off a debt after bankruptcy.
- Adversary proceeding – A lawsuit filed within a bankruptcy case, typically to resolve a dispute between the debtor and a creditor.
- Plan confirmation – The process of approving a debtor’s proposed repayment plan in a Chapter 13 bankruptcy case.
- Liquidation – The process of selling a debtor’s non-exempt assets to pay off creditors in a Chapter 7 bankruptcy case.
- Homestead exemption – An exemption that protects a debtor’s primary residence from being seized in bankruptcy.
- Exempt property – Property that is protected from being seized in bankruptcy, such as household goods or a certain amount of equity in a car.
- Non-exempt property – Property that is not protected from being seized in bankruptcy, such as a second home or luxury items.
- Credit counseling – A requirement for individuals filing for bankruptcy to attend a counseling session to explore alternatives to bankruptcy.
- Bankruptcy discharge injunction – A court order that prohibits creditors from attempting to collect on discharged debts after bankruptcy.