How To File Bankruptcy

The first decision to consider when thinking about filing for bankruptcy is to determine whether your situation is a fit for a Chapter 7 or a Chapter 13. It’s important to note that the laws regarding filing bankruptcy, and then being discharge, are very strict. Even if you file for bankruptcy, if you don’t follow the guidelines exactly you might not be discharged. And, not all debts can be erased by bankruptcy these days.

Let’s discuss the difference between a Chapter 7 filing and Chapter 13 bankruptcy. Most Chapter 7 processes involve having the debtor make some payments to their creditors. Unless you have zero income, and no assets, you might have to make some payments.  Chapter 13 is a much more complicated process and is generally the choice if you have real physical assets and some income. In most cases, you will be required to fill out some paper work and a “means test” will be done. This test is to determine your debt load, and your ability to repay. A bankruptcy firm or attorney can help you with a quick means test and then advise you as to your best option.

Here are the few requirements you must meet if you with to file:

– You have to be at least 18 years of age.
– To file in US courts you must be a US citizen (even if you are currently living here)
– Or, if you are conducting business in the US, you can file in a US court
– Or, if you are a US real estate/property owner you can file in the US court

Can I file bankruptcy more than once?

If you go through a Chapter 7 bankruptcy you are not allowed to file again for 8 years. And generally, if you go through a Chapter 13 bankruptcy you must wait at least 6 years. There are a few special exceptions for unusual cases.

What should I do before I file?

Our suggestion is to first inform yourself of your options. Second, go have a free initial consultation with a bankruptcy attorney. Many times a professional can help you optimize your “means test”. By preparing and planning for your “means test” you can reduce the likelihood that you’ll have to make significant payments while in the bankruptcy process.

Unfortunately, many of the people who follow the “do it yourself” method actually end up paying more during their bankruptcy. A good lawyers or firm that specializes in this process can actually save you money in the long run. Call around an try and get a few free consultations. These firms can be a wealth of good information when deciding how to file for bankruptcy.

A free consultation can be money well spent!