How to File Chapter 7 as an Individual Debtor

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In order to file Chapter 7 bankruptcy, an individual debtor must first initiate the process by filing a petition with the local bankruptcy court in the individual’s current state of residence. Prior to taking this action, however, it is highly advisable, and even noted by the Federal Courts, that an individual consult with a bankruptcy lawyer on the following items, including:

  • The alternatives to bankruptcy, which may or may not be applicable in a given case, but should at least be considered initially
  • The general eligibility requirements to file Chapter 7, which include factors related to income, expenses, and current outstanding debt obligations, among others
  • The general idea behind Chapter 7, specifically what debts are dischargeable (relating to the case-specific debts held by a given individual) and what debts are not dischargeable. Likewise, determining what assets are exempt from liquidation (varies widely from state to state) and what assets will be subject to liquidation
  • A general insight into the future ramifications of filing, including financial reporting, ability to file future bankruptcy claims, and other items

The Chapter 7 Process

To file Chapter 7 bankruptcy as an individual, the following must take place:

  • Initiate the process by filing petition with appropriate court. Petition will require additional documentation outlining all assets and debts (in specific schedules required by courts), schedules noting current expenses and income, a general statement of financial affairs, and schedule related to any outstanding leases, contracts, or other financial obligations
  • The debtor, once assigned a trustee, must also provide tax return from latest fiscal year, and if applicable, any unfiled returns from other years
  • Individual debtors specifically must undergo credit counseling with federally approved agency, including forwarding certificate of completion to courts, often alongside suggested repayment plan noted by counseling agency and income statements and expected expenses with documentation, if available
  • Debtors must also pay fees of $299, but fees may be waived or repaid in installments, if requested by debtor and approved by courts in limited circumstances
  • Complete any outstanding documentation in Official Bankruptcy Forms, as part of the petition, which often requires listing all creditors, amounts owed, and detailed current income and expenses outlines, among others, if requested

Getting Legal Help with Filing for Chapter 7

The actual work behind filing for Chapter 7 requires the insight of a bankruptcy lawyer. While actually filing the petition with the courts can theoretically be done by an individual debtor, the reality is that any successful Chapter 7 filing will involve pre-bankruptcy planning with a bankruptcy lawyer. For more information and insight, specifically insight into how to file for Chapter 7 in your specific case, consult with a bankruptcy lawyer in your state of residence today.

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