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 countering requirement. There is an official court form
that must be used for these purposes. Approved agencies must 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 our 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
and 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.