What To Expect When You’re Filing Bankruptcy

Filing for bankruptcy is never an easy decision to make. It can also be confusing, stressful, and even scary. To help you understand what to expect when you’re filing bankruptcy, I’m going to give you a step-by-step guide on how the process works and provide some tips for making sure your finances are in order before filing for bankruptcy protection.

What to expect if you file for bankruptcy – YouTube
Understand the different types of bankruptcy (Chapter 7, Chapter 11, Chapter 13).
Know which debts can be discharged through bankruptcy and which cannot.
Be prepared for a potential drop in your credit score after declaring bankruptcy.
Research the exemptions available in your state to determine which assets you can keep.
Expect to participate in meetings with creditors and a bankruptcy trustee after filing.

Why Are You Filing?

If you’re thinking of filing bankruptcy, it’s important to consider why. If you’re considering bankruptcy because you want to get rid of a few frustrating debts or bad loans and start fresh, then those are great reasons!

However, if your debt situation has gotten so bad that you can’t pay your bills on time or at all (and your creditors are calling), then it may be better for you to file Chapter 7 instead of Chapter 13. 

A good rule of thumb is: if the amount of debt is greater than the value of what you own (your assets), then filing for Chapter 7 may be the best option for getting out from under that burden quickly and moving forward with life.

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You Might Need A Lawyer

If you’re filing bankruptcy, you might need a lawyer. And if you do, that’s okay! The U.S. Congress created the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) in 2005 as a way to streamline the process of filing for bankruptcy and make it more accessible for all Americans.

This act made it so anyone who files for Chapter 7 or Chapter 13 bankruptcy must have legal representation unless they’ve already represented themselves in court before and even then, it’s not recommended that you try to represent yourself again without an attorney present at your side.

It’s also important to remember: Your lawyer is working with you on behalf of yourself and your creditors.

Their main goal will be to protect both parties from any unnecessary harm during this stressful period in life so don’t take anything personally if your lawyer asks for clarification about something; he or she is only trying his best at doing what he or thinks is best for everyone involved!

Understand Your Credit Score

A credit score is a number that represents your creditworthiness. It’s calculated by most credit reporting agencies to gauge how likely you are to repay the money you owe on time and in full. The higher your score, the more likely it is that you’ll be approved for loans, credit cards, and other forms of debt.

When it comes to bankruptcy, understanding your credit score can help ensure that everything goes smoothly during your case and afterward. Here’s what to expect at each stage:

Filing bankruptcy: Once you file for Chapter 7 or Chapter 13 bankruptcy protection, creditors cannot take any more collection actions against you until after the discharge date (the day when all debts are discharged). 

This protects you from ongoing harassment and prevents further damage to your credit report which could make it harder for others like landlords or employers to get in touch with potential employers later on down the road if they do so based solely on these factors alone.

After filing: You may experience some negative effects immediately the following filing because some people who check a person’s history may think negatively about them based upon seeing one negative mark on their record (even though this isn’t always true!). 

However, after discharge has been completed there shouldn’t be any long-term effects unless something else happens afterward.”

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Consider Your Type Of Debt

Your debt is what you owe, and the type of debt will determine if it can be discharged in bankruptcy. 

You can’t discharge student loans, taxes, child support or domestic support obligations, criminal fines and restitution (including jail time), debts incurred by fraud, or a crime committed by you or a member of your family (such as embezzlement). 

If you are filing together with someone else on the same petition for example, if both spouses file together you cannot discharge jointly owned property unless you’re married under “community property” rules.

If one spouse files for bankruptcy alone, he may still be able to protect some assets from creditors through “exemptions” available under federal law.

Be Wary Of Credit Counseling

Make sure you don’t pay for credit counseling. Federal law requires that the first meeting with a credit counselor be free, but some companies will try to get you to give them money before then. 

The best way to avoid this is by going directly to the FTC’s website and finding a list of approved nonprofit organizations that provide free consumer education and counseling services.

If someone approaches you about filing bankruptcy but asks you to sign a debt management plan or reaffirmation agreement beforehand, they’re probably trying to make money off of your situation. You should avoid signing any agreement until after you’ve filed your case and received legal advice from an attorney or accredited financial counselor (or both). 

Debt settlement agreements work much like reaffirmation agreements in that they require borrowers who can’t afford their monthly payments on time every month to pay something instead but unlike reaffirmation agreements, debt settlement agreements are not protected by law.

Therefore, creditors are allowed to report these debts on consumers’ credit reports even after settlement payments have been made

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Find Out What (And What Not) Bankruptcy Covers

When it comes to bankruptcy, there are two big things you need to know: what can be discharged, and what can’t. What can be discharged are debts like medical bills and credit card debt. What cannot be discharged include student loans, tax debt, child support, criminal fines/bail, and some mortgage loans?

A debt not covered under bankruptcy may not have been included in the original filing because it was already being paid off at the time of filing; this includes child support payments or alimony payments if they were being made through a court order before the bankruptcy petition was filed. 

Some debts might also not be covered even if they were included in your initial petition if those creditors have filed objections against them (such as certain types of IRS liens). 

If this happens, your attorney will work with you to find out whether any other options exist for eliminating these remaining obligations from your life without having them haunt you for years after filing for bankruptcy protection such as negotiating settlements with creditors.

Offering payment plans instead of full repayment but ultimately these debts will remain due once again after finalizing your case unless extended payment terms were negotiated before closing proceedings on all outstanding accounts which could potentially save money over time since interest rates would no longer apply during those periods.

Understand Which Debts Can’t Be Discharged

To qualify for bankruptcy, you must have debts that are “dischargeable,” and the list of such debts is quite extensive. If your debt belongs to one of these categories, it can’t be discharged:

  • Family support obligations (such as spousal or child support payments).
  • Tax debts (like back taxes).
  • Student loans (even if they’re in default).

In addition to these types of debts, there are certainly other kinds of debts that aren’t dischargeable. These include:

Debts incurred by fraud, embezzlement, or willful or malicious injury to another person or entity. For example, if you borrow money from someone under pretenses and then don’t pay it back when they find out what happened or if you steal something from someone else that’s considered fraud and won’t be discharged through bankruptcy. 

The same goes for any other kind of theft if someone was injured as a result of your theft and then sued you for damages related to their injury (e.g., medical bills).

Those medical bills wouldn’t get discharged either since they were incurred as part of the fraudulent activity itself rather than just because they had nothing better planned on Saturday night after watching Netflix all week long so why not treat yourself with some ice cream sundaes while watching reruns? 

This section also covers crimes like an assault; sexual abuse; kidnapping; arson; burglary/breaking & entering into any building without permission while intending no harm but merely wanting some change from inside pocket(s).

Before leaving without stealing anything else nearby except maybe car keys left unattended near front door unlocked which may allow unauthorized usage later on down the road when owners do not want anyone driving off with vehicle parked outside garage door open 24/7 unattended during summer months

Identify Non-Dischargeable Debts That Aren’t Secured By Property

Non-dischargeable Debts

What are non-dischargeable debts? These are debts that cannot be eliminated in bankruptcy. The most common non-dischargeable debt is student loans, which you will have to pay back no matter what happens in your case. 

Other examples of non-dischargeable and nondischargeable expenses include alimony and child support payments, criminal fines, and debts you’ve been ordered to pay by a court (i.e., restitution).

You may also have some other types of debt that aren’t dischargeable; one example includes property taxes owed on real estate property where the debtor lives or rents on the date they file bankruptcy (this isn’t true if they owned the land before filing bankruptcy).

Debts Secured by Property Are Not Discharged in Bankruptcy Unless They Can Be Classified as “Consumer Debt.

If a creditor has given you a mortgage or car loan, for example, he or she’s secured his claim against your house with an interest rate higher than what could be found on a standard unsecured loan from another lender -which means if that creditor wants his money back from you after filing bankruptcy then he will still get paid!

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Beware Of The Automatic Stay

The Automatic Stay. If you are filing for bankruptcy, expect that creditors will stop contacting you and sending letters. In addition to this, they cannot sue or take legal action against you while the automatic stay is in place.

This federal law applies only to the person who files for bankruptcy, not their spouse or family members. It also does not apply to secured debts (like mortgages), so most of your creditors can continue collecting on those loans during this period.

While these protections end when your bankruptcy case closes (usually after about three months), be aware that some types of debt may have been discharged during that period meaning they’re no longer eligible for collection by creditors at all!

Assess How Much You Owe And To Whom It Is Owed

This is the point where you’re going to take a hard look at your finances and see what you can afford. You’ll have to assess the following:

A list of all your creditors, including lenders, credit cards, medical bills, and others. Make sure this includes all creditors that might be on your credit report (not just those who have contacted you). If any debts aren’t listed, add them as well.

Assets: List everything that has value cars, jewelry, and other valuables but also less expensive items like furniture and appliances and their approximate prices in order from highest to lowest value in case they need to be sold (more on selling assets later). This will help determine how much equity or “equity cushion” you have available for use during bankruptcy proceedings.

Income sources: List how much money comes into each household member’s account every month as well as what expenses go with it (rent/mortgage payment; utilities such as water or electricity). 

Also, make note of any irregular income sources like bonuses from work or tax refunds since these could affect overall monthly income levels significantly depending on when they arrive during a given year’s cycle between January through April 15th annually depending upon whether taxes were owed before filing bankruptcy which affects.

When one receives refund checks back after filing bankruptcy petition forms with US Trustee Bankruptcy Court Clerk’s office located within US District Court building located within city limits where the debtor lives closest nearby courthouse over next few months time frame while awaiting court date hearing date set by the judge presiding over cases filed under Chapter 7 vs Chapter 13

Legal proceedings occur while waiting months later for hearing dates scheduled prior to starting date in day morning hours between 6 am-8 am.

First thing mornin’ after wake up call goes off the early morning before sunrise wake start getting ready eat breakfast etcetera prepare yourself mentally prepared physically enough food intake amount needed calories burned off exercise routine amount needed restfulness sleep quality required

Take A Look At Your Income And Assets

When you file for bankruptcy, the court will look at your income and assets. This is because they are taken into account when deciding how much debt you can pay back. Depending on what type of bankruptcy you’re filing (Chapter 7 or 13), the court may also use your income and assets to determine whether or not they consider you eligible to file a certain type of bankruptcy.

Determine Your Chapter 7 Or 13 Eligibility

There are two types of personal bankruptcy: Chapter 7 and Chapter 13.

Chapter 7 bankruptcy is for people who have very little or no equity in their home or car and little income. People with these characteristics can often discharge all secured debts (such as a car loan), as well as unsecured debts such as medical bills and credit card debt, but most student loans are not discharged in this type of filing. 

If you file for Chapter 7 bankruptcy, your assets will be sold off to pay back some of the money you owe if there’s anything left over after that happens, it’ll be yours to keep.

Chapter 13 bankruptcy is for people who have some equity in their home or car and have some income coming in each month. In this scenario, you’ll repay all (or most) of what’s owed over time with what remains after applying payments toward interest charges on each account. 

Until they’re paid off completely by filing an income-based repayment plan before filing your petition with the court.

This means that if you don’t want any liens remaining on any property when everything is said at done then I would suggest going through one option first before deciding on whether or not else-wise may work out better! 

If unsure which route would work best then just ask around because sometimes there might even be someone close by who has been through something similar themselves before making any rash decisions about taking action right away without knowing what could happen next.

Make Sure Everything Is In Order Before You File

It’s important to make sure that you have all the paperwork and information you need for your bankruptcy before filing. 

This includes a list of all your creditors, assets and liabilities, income and expenses, debts, and other financial information. It’s also important for you to make sure that there are no mistakes or omissions on those documents a mistake could delay or even derail your case altogether.

Avoid Getting Money Before You File For Bankruptcy

If you’re planning to file for bankruptcy, there are several things you should do before filing. It’s important to understand the ramifications of each action and how they may impact your case. 

For example, if an individual takes out a loan or secures credit during the waiting period before filing for bankruptcy (two years from the date of discharge), that debt can be included in their bankruptcy plan unless it was taken out due to severe financial hardship (e.g., medical bills). 

If a person receives a life insurance payout during this period, that money will also not be discharged through Chapter 7 or 13 bankruptcy filings because it wasn’t part of his or her estate at the time of filing.

To avoid these difficulties and ensure that your case goes smoothly without any hiccups along the way, here are some tips on what to do before filing:

  • Don’t use credit cards or open new accounts while you’re waiting for your court date
  • Avoid borrowing money from friends or family members (unless under extreme circumstances)
  • Avoid cashing in life insurance policies

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File On Time, Online If Possible, If Not, Then Via Paperwork

If you’re filing bankruptcy, be sure to file on time. Filing offices usually close at 5 p.m., but most courts will allow you to submit your paperwork after then if you are truly in need of an extension. 

If there isn’t a local office near where you live and work, try using the internet for assistance with this overwhelming process by submitting your application online. 

If it is not possible for you to file online or if there are no nearby courthouses that allow this option, then simply mail in a copy of all documents as they become available throughout the process until they are complete and ready for court approval.

When sending anything by mail, keep copies! If a document gets lost along its journey through the legal system (and believe me it happens!), having an extra set will help ensure that nothing gets lost amid all those papers being shuffled around by clerks who can barely see over their piles of paper!

Keep Copies Of Everything You Submit To The Court

If you are filing for bankruptcy, make sure that you keep copies of everything that you submit to the court. This is especially important if your case is not yet completely resolved. You will want to keep track of what happens with your case to know if there are any issues or delays that occur and get them taken care of as soon as possible.

Stop Using Credit Cards And Avoid Opening New Accounts When Filing For Bankruptcy

Stop using credit cards. When you file for bankruptcy, make sure that you stop using all of your credit cards and don’t open any new ones. 

You’ll want to avoid using any type of credit card that is not secured by property (a home or car) because those types of accounts are not included in the bankruptcy discharge. If you do have an unsecured line of credit, like a personal loan or a store card, it’s best to talk with your attorney before making any charges on them during this time.

Avoid opening new accounts when filing for bankruptcy. Filing a Chapter 7 doesn’t mean that your life has to come to a grinding halt you can still apply for jobs and set up utilities under the protection of federal law but it does mean that you should avoid opening new accounts until after the process is complete. 

Once again: if there’s something important coming up in your future (like buying Christmas presents), make sure that you talk with an attorney beforehand so they can advise you on whether any purchases will be affected by filing for bankruptcy protection!


You’re probably wondering what your life will look like after filing for bankruptcy. We know that it can be an overwhelming process with a lot of questions, but the good news is that it doesn’t have to be. With our help, you’ll be able to get through this process as quickly and painlessly as possible by learning more about what happens next when filing bankruptcy.

In short: Filing for bankruptcy won’t hurt your credit score or credit history (in most cases), but there are still some things you should think about before deciding to file. 

For example, if you have debts outside of the ones listed on your petition (for instance, if someone co-signed with you on a credit card), they may still try collecting those debts from you after your case has been closed out by the court (even though they won’t show up on your credit report). 

Or maybe there’s something else important like taxes or child support payments that need attention before filing.”

Further Reading

Explore more resources to deepen your understanding of bankruptcy:

Investopedia’s Guide to Bankruptcy: Learn about the different types of bankruptcy and how they can impact your financial situation.

What Happens if I Declare Bankruptcy?: Find answers to common questions about the consequences of declaring bankruptcy and its effects on your assets and debts.

What Happens After Filing Bankruptcy: Discover the post-bankruptcy process, including rebuilding credit and regaining financial stability.


Here are some frequently asked questions related to bankruptcy:

What are the different types of bankruptcy?

Bankruptcy can be filed under various chapters, such as Chapter 7, Chapter 11, and Chapter 13. Each chapter serves a different purpose, ranging from personal debt relief to reorganization of businesses.

Will declaring bankruptcy wipe out all my debts?

Bankruptcy can discharge many types of debts, but not all. Certain debts, like student loans and child support payments, may not be eligible for discharge.

How does bankruptcy affect my credit score?

Bankruptcy can negatively impact your credit score, causing it to drop significantly. However, as time passes and you make responsible financial decisions, you can work towards rebuilding your credit.

Can I keep any of my assets if I declare bankruptcy?

The ability to keep assets during bankruptcy varies depending on the type of bankruptcy you file and the exemptions available in your state. Some assets might be protected, while others could be sold to repay creditors.

What is the process after filing for bankruptcy?

After filing for bankruptcy, you’ll attend a meeting with your creditors and a bankruptcy trustee. The trustee will assess your financial situation, and depending on the type of bankruptcy, you may need to follow a repayment plan or liquidate certain assets.