Credit Counseling

• Both Chapter 13 and Chapter 7 bankruptcies require debtors to obtain credit counseling from a government-approved agency within six months prior to filing. The U.S. Department of Justice's website for the U.S. Trustee Program contains contact information for government-approved credit counseling organizations. A reputable credit counselor will not only help you in your bankruptcy preparations but will also assist in budget creation so that you may avoid filing for bankruptcy again in the future.
  
  

Means Test

• Those filing for Chapter 7 bankruptcy must submit to a means test, which is verification that your income falls below the median income levels for your state. The reason that Chapter 13 filers do not need to submit to a means test is that Chapter 13 bankruptcy is a payment program for individuals with a steady income, at the end of which certain debts are discharged. Chapter 7 is a straight bankruptcy in which possessions are liquidated in exchange for relief from certain debts, and no payments are made.
  
  

Petition Forms

• It's best to hire a bankruptcy attorney to help you through the filing process; however, if you do not hire a lawyer, you may prepare the petition forms yourself. Each state's bankruptcy court has its own Local Bankruptcy Forms that may be filed along with the Official Bankruptcy Forms. Official Bankruptcy Forms may be downloaded from the United States Courts' website. You should contact your state's bankruptcy court to inquire about obtaining Local Bankruptcy Forms.
  
  

Considerations

• One of the credit counselor's jobs is to provide you with all of your options for getting out of debt. Listen carefully to alternatives that the counselor offers, as you may be able to avoid bankruptcy, which means that you don't have to start from scratch in rebuilding your credit score. Such alternatives may include debt consolidation or debt management plans that are less harmful to your credit than bankruptcy.