Bankruptcy Basics - Part 4: Filing for Bankruptcy

The following program was produced by the United States Courts.

Before you file a bankruptcy case, you must complete credit counseling provided by a government approved agency. The purpose of this counseling is to explore alternatives to bankruptcy in your particular situation. You must obtain from the agency a certificate describing the counseling services you received.

This certificate must be filed with the court as an attachment to your statement of compliance with the credit counseling requirement. There is an official court form that must be used for this purpose. Approved agencies may be found by calling the bankruptcy court in your area or by accessing a list found on the bankruptcy court’s website. Many agencies offer online counseling sessions. The cost varies and some agencies will reduce or waive the cost depending on your circumstances. It is important to obtain this counseling prior to filing. If you do not the court can dismiss your case and you may lose any filing fee you've already paid Even if you refile, you may lose important bankruptcy rights and may not be able to stop the collection activities of your creditors. You also may be required to pay a second filing fee. The counseling requirement can be waived only under very limited circumstances, so you need to understand this requirement and take care of it before you file.

To start a bankruptcy case you file what is called a petition with the bankruptcy court in the Federal Judicial District and division where you live. The petition contains a request for relief under one of the chapters of the bankruptcy code. You must file a statement regarding various financial matters and disclose all creditors and assets on forms called schedules, and you must fill out a form showing whether you should file under chapter 13 rather than chapter 7 given the amount of money that is left over each month after deducting reasonable household expenses. This form is called the means test form.

Most debtors must pay a filing fee. The amount of your filing fee depends on the type of bankruptcy case you file. The fee is payable in cash, certified check, or money order and may sometimes be paid in four monthly installments. If your income falls below a certain amount you may request that the filing fee be waived. If you do not file the required documents or pay the filing fee in a timely manner the court may dismiss your case.

You must also attend a meeting of creditors, which we'll talk about next. Failure to attend this meeting may also lead to dismissal.