Bankruptcy Court

The bankruptcy court is a federal district court, there are eighty-nine of them in the United States.  The court is a federal court because the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 and other bankruptcy statutes are federal law.  Each state also has laws covering assets, as well as the federal law has rules covering assets.  The two year residency requirement means that a filer has to have lived in that state for two years to use a particular state's asset definitions.  If not, the filer must use the previous state's definitions or the federal definitions.  This prevents people from moving to a state with lenient rules for the purpose of filing bankruptcy.

Bankruptcy Court Websites

Each of these bankruptcy courts has a web site and filing can be accomplished online.  If the debtor is foolish enough not to hire an attorney, he can do the filings himself.  This is called a pro se filing, the debtor represents himself without the benefit of counsel.  The value of an attorney is to advise the filer and to help him get the best deal possible.  Chapter 13 bankruptcy filings involve negotiations with creditors to renegotiate the terms of the debt and to set up a payment schedule.  Terms can be negotiated in such a way that a portion of the debt can be discharged once the debtor has performed his part of the deal.  Unless the debtor is extremely knowledgeable and good at handling negotiations, he is better off having some form of representation.  The bankruptcy attorney is a specialist who knows all of the ins and outs of bankruptcy proceedings.

The bankruptcy court websites have instructions for filing online.  They also have the necessary forms, whether you are filing pro se or not.  Instructions for the income means test and the computation of disposable income can be found there as well as directions for the valuation of assets, for those filing under Chapter 7 bankruptcy.  Most of this is accomplished by the potential filer filling out a questionnaire and watching a bankruptcy education program before being put in contact with an attorney.  This is the basics of the Arizona program as presented on their website.  The debtor will also find information regarding the 2005 law and explanations of the different Chapters.  If you don't find what you need on one court website, check another website.  Every website is pretty much self-contained in the information they provide.

Filing Costs in Bankruptcy Court

The cost of a bankruptcy court filing increased as of April 2006.  The filing fee for Chapter 7 bankruptcy is $299 and for Chapter 13 bankruptcy it is $274.  The bankruptcy credit counseling agency's services and legal fees are in addition to the filing fees.  Coming up with money for these fees is probably not easy for someone who is filing personal bankruptcy, but the potential filer should definitely seek the advice of a legal expert, a bankruptcy lawyer before venturing on filing in bankruptcy court.