Legally declaring yourself bankrupt requires officially filing for bankruptcy protection in federal bankruptcy court. Filing typically requires payment of a processing fee, but waivers are possible for those who do not have enough money. That means it is possible to declare yourself bankrupt for free if you receive the waiver and represent yourself in court without an attorney. As of 2011, standard bankruptcy filing fees are $299 for Chapter 7 bankruptcy and $274 for Chapter 13 bankruptcy. Fee waivers are available only on Chapter 7. Installment payment plans for the filing fee are available on Chapter 7 and Chapter 13. Chapter 7 and Chapter 13 are often used for individual bankruptcy filings.
Schedule two or three meetings with bankruptcy attorneys offering free initial consultations. Meeting with more than one attorney allows you to ask more questions. The attorneys can review your reasons for wanting to declare yourself bankrupt and provide estimates on legal fees. Fees may vary, ranging from a few hundred dollars for a simple bankruptcy to a few thousand for complex cases. It is possible to represent yourself, but the United States Bankruptcy Court recommends against it because of the complexity of bankruptcy. The attorneys also can advise which type of bankruptcy is best for your situation.
Make an appointment with a nonprofit credit counselor approved by the U.S. Department of Housing and Urban Development. Get referrals for counselors in your area by contacting a local chapter of Legal Aid or a charity such as the Salvation Army. Talk to the counselor about costs related to declaring yourself bankrupt, such as the effect on your credit rating. Bankruptcy is listed on credit reports for a minimum of 10 years, resulting in higher interest rates and greater costs for credit for a while. The counselor can discuss less costly alternatives to bankruptcy -- such as debt settlement or debt management plans.
Calculate the costs of declaring yourself bankrupt after meeting with bankruptcy attorneys and government-certified credit counselors. Consider filing fees, attorney expenses and the cost of future bad credit. Predicting the exact cost of bad credit is impossible, but acknowledging that you'll pay more for credit merits consideration.