How to File for Financial Bankruptcy

The decision to file for financial bankruptcy is not an easy one. Individuals who educate themselves on the bankruptcy process can avoid collection problems, stress due to unfamiliar paperwork and processes and additional fees.

Difficulty: Moderate

Instructions

1. Decide which form of bankruptcy is right for you. Chapter 7 bankruptcy involves liquidation of assets that are then distributed to creditors. Usually a Chapter 7 bankruptcy involves little or no assets and the debts are discharged.

2. Consider Chapter 13 bankruptcies if you have a regular income and/or you do not want to liquidate important assets like homes and vehicles. Chapter 13 bankruptcy involves repayment of all or a portion of the debt, but individuals are protected from harassment and payments are adjusted, usually lowering payments.

3. Collect all information regarding current debt. This includes names or companies, or individuals owed money as well as the amount. Have relevant documentation of assets and income. This includes spousal information.

4. Contact a local or county courthouse regarding the proper paperwork to file in your jurisdiction. Or many forms may be downloaded at uscourts.gov.

5. Pay the appropriate filing fees for the financial bankruptcy applied for. If an individual is unable to pay and meets certain criteria regarding poverty levels and income, they may request a waiver to avoid paying filing fees. Or payment plans can be made with the court clerk.

6. Know that the court a court agent will contact debtors listed. In most cases collections will stop until a decision is made on the bankruptcy.

Tips & Warnings

• Keep all documentation of records from the court as well as copies of documents sent to the court.

Resources

• US Courts Bankruptcy Info and Forms

[awritermom]

on 2/23/2009 Excellent article about filing for financial bankruptcy. Thank you very much for sharing. : )

[DiscountTickets]

on 2/22/2009 Yeah Bankruptcy, I did this about 15 years ago.