Step 1. Learn About Bankruptcy - Filing for bankruptcy is an important decision. The help provided by the bankruptcy law can get rid of your obligation on some debts, provide you with a breathing spell from creditors, and, in a chapter 13 case, a chance to catch up on mortgage and car payments. At the end of a successful case, a debtor obtains a “discharge.” The discharge order may not apply to all of your debts and does not by itself remove liens against your property.
You should learn about bankruptcy to determine if filing is right for you. The following resources give more background about the bankruptcy process:
Bankruptcy Basics will provide you with a detailed overview of the various bankruptcy chapters. You will need to file bankruptcy under one “chapter.“ A bankruptcy chapter is a set of related laws. Most individuals file under chapter 7 or 13. Chapter 7 is generally for individuals who have less income than expenses. Individuals in chapter 7 can keep some or all of their property but some property may be sold to pay creditors. Chapter 13 is for individuals with regular income. In a chapter 13 case, you can sometimes keep all of your property and catch up on past due debts. It is also possible in a chapter 13 case to pay less than you owe to creditors who do not have a lien through a “chapter 13 plan.”
If you see legal terms that you do not understand, you can review a glossary of bankruptcy terms.
Click here to view how to treat sensitive information in your bankruptcy case, according to the E-Government Act of 2002.
Step 2. Complete Credit Counseling. Individual debtors must complete credit counseling within 180 days before filing for bankruptcy. You do not have to have credit counseling if you qualify for a limited exemption or waiver from the credit counseling requirement. If you have not completed credit counseling before filing a bankruptcy case, you will be ineligible for bankruptcy and your case will likely be dismissed. To fulfill the credit counseling requirement, do one of the following:
Find Approved Credit Counseling Agencies and complete Credit Counseling; or
Request a waiver or exemption from credit counseling in Part 5 of the voluntary petition.
Step 3. Complete Required Documents.
Review the Chapter 7 Filing Requirements if you are filing chapter 7 or
Review the Chapter 13 Filing Requirements if you are filing chapter 13.
Step 4. Make a list of your creditors. - List the names and addresses of all of your creditors. Write down or type a list of everyone who may have a claim against you or a lien against your property. Examples of a lien against your property would be a mortgage on your house or if you took out a loan to pay for your car. It is crucial to have accurate addresses for your creditors. If you do not accurately list your creditors, you may not have the full benefit of the bankruptcy process. It may be helpful to gather a list of your creditors from a credit report. You can learn about how to get a free credit report from the Federal Trade Commission. These address will be submitted in a "Matrix" as mandated in the Matrix Requirements.
Step 5. Get a copy of your paystubs.- If you have a job, you will need to file with the Court a copy of your paystubs for the 60 days prior to filing. If you do not have a job, get government assistance (i.e. SSI, Social Security or VA benefits), or are self-employed, you will file a statement telling the court that you do not have paystubs. The Payment Cover Sheet can be used as that statement.