What are the requirements to file bankruptcy in Delaware?

There are two types of bankruptcy in Delaware as in the rest of the United States, Chapter 7 and Chapter 13.  Chapter 7 allows most of your unsecured debts to be discharged (eliminated); moves very quickly; and prevents creditors from contacting you.  In order to file a Chapter 7 bankruptcy, you must have little property except for the basics; and little or no money after paying for basic necessities.  Chapter 13 allows you to keep most of your property while spreading out payments to creditors over 3 to 5 years.  This type of bankruptcy requires that the debtor have significant equity in property that you wish to keep, and they have a regular income sufficient to pay living expenses; but not enough to pay past due accounts. There may even be a way to keep your home even if foreclosure procedures have been started.

In Delaware, the law requires those considering filing bankruptcy must meet two requirements:   1) The Bankruptcy Act of 2005 requires that all persons must receive credit counseling 6 months prior to filing, and must also complete a financial management class after filing; and, 2) They are also required to be evaluated based on the “means test” which looks at the income and expenses from the previous 6 months.  A determination will then be made as to whether Chapter 7 or Chapter 13 is the proper bankruptcy to file.

If you are considering filing bankruptcy seek the advice of a bankruptcy attorney because filing can be very stressful and emotionally upsetting.  You will need someone to go to meetings with you and navigate Delaware’s rules, regulations, and exemptions.