Chapter 7 Bankruptcy

Learn why this is the most common type of bankruptcy and what you should know about getting a fresh start through Chapter 7 bankruptcy.

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Chapter 7 Bankruptcy

Chapter 7 is the most common type of bankruptcy relief. It helps people who simply don’t make enough to make ends meet eliminate their debt while protecting their most important belongings. Learn how Chapter 7 bankruptcy works, the pros and cons of filing bankruptcy, what types of debt can’t be eliminated, and more.

This page is a hub for people looking to erase debts that they can’t afford to pay.

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What Is Chapter 7 Bankruptcy & When Should I File?

Written by Kristin Turner, Harvard Law Grad. Legally reviewed by Attorney Andrea Wimmer
Updated March 12, 2025

Chapter 7 bankruptcy is a common legal process to clear your debt, but it’s not right for everyone. One good question to ask yourself if you’re considering Chapter 7 bankruptcy: Do I have more debt than I’ll ever be able to pay back, given my current income and property? If the answer is "yes," then Chapter 7 bankruptcy may be the right option.

Written by Attorney Andrea Wimmer, Ben Jackson. Legally reviewed by Jonathan Petts
Updated January 23, 2025

Chapter 7 bankruptcy is a powerful debt relief tool. It helps give a fresh start to those who are drowning in debt and can't see a way out. Though bankruptcy requires a lot of paperwork and documentation, many people with simple cases file successfully on their own without a lawyer. Here are the 10 steps to file your case successfully: 1. Collect your documents 2. Take the required credit counseling course 3. Complete the required bankruptcy forms 4. Get your filing fee ready or fill out a fee waiver request 5. Print your completed bankruptcy forms 6. Go to the court to file your forms 7. Mail required documents to your trustee 8. Take the second required bankruptcy course on financial management 9. Attend the 341 meeting with your trustee 10. Deal with your car loan if you have one

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated March 12, 2025

The main pros to Chapter 7 are that you can receive immediate relief from collection actions (due to the automatic stay) as well as permanent relief from debts if your bankruptcy is discharged. The main cons to Chapter 7 bankruptcy are that most secured debts won’t be erased, you may lose nonexempt property, and your credit score will likely take a temporary hit. Filing for bankruptcy is a very effective way to eliminate debt and get a fresh start. As with everything, there are upsides and downsides to filing Chapter 7 bankruptcy.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated January 30, 2025

The Chapter 7 means test is the analysis that determines whether you're eligible to file Chapter 7 bankruptcy. It’s called the bankruptcy means test because, at its most basic level, it looks at whether someone has the means (ability) to pay their debts. The means test has two main steps, but if you "pass" the first step, you don't have to do the second step. In the first step, you'll compare your income to the median income in your state based on the size of your household. If you don't "pass" the first step, you can move on to the second step, which takes your expenses into account as well.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated March 25, 2025

Filing Chapter 7 bankruptcy comes with costs, including court fees, credit counseling fees, and attorney fees. But some filers can do it for free or at a very low cost. If your income is low enough, you can request a court fee waiver and reduced or waived credit counseling fees. Filing without a lawyer is possible, and free tools like Upsolve can help guide you through the process. If you prefer legal help, you may qualify for free or low-cost assistance from legal aid organizations or pro bono attorneys.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated March 11, 2025

Filing for Chapter 7 bankruptcy requires completing a packet of 23 official forms, including a voluntary petition, schedules, and financial statements. Together, these forms make up what’s commonly called your bankruptcy petition. Each form serves a specific purpose, such as listing your debts, assets, income, and expenses. While it might seem like a lot, most of the information comes from documents you already have.

Written by Mae Koppes. Legally reviewed by Attorney Paige Hooper
Updated March 18, 2025

If the bankruptcy filing fee is standing between you and a fresh start, you can apply for a fee waiver or to pay in installments. To qualify for a waiver, your income must be below 150% of the federal poverty guideline, and you must show that you can’t afford to pay in installments. This guide walks you through the fee waiver process, eligibility requirements, and what to do if your request is denied.

Written by Attorney Jenni Klock Morel. Legally reviewed by Jonathan Petts
Updated March 10, 2025

To qualify for Chapter 7 bankruptcy, you need to pass a means test. In the test, you compare your income with the median income of a similar size household in your state. If your income is lower, you pass the test. If it’s higher, you have to move on to the next step in the means test, which takes your expenses and disposable income into account.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated March 13, 2025

The Chapter 7 income limits were added in 2005 when Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA). Since Chapter 7 bankruptcy doesn’t involve a repayment plan of any kind, Congress worried about an abuse of the bankruptcy process by filers who could afford to pay their debts. To prevent this, Congress added a credit counseling requirement for anyone filing any type of bankruptcy and set income limits for Chapter 7 relief. The bankruptcy means test calculation determines whether someone can afford to pay a portion of their consumer debts as part of a Chapter 13 bankruptcy, which requires a 3–5 year repayment plan.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated March 11, 2025

Chapter 7 and Chapter 13 bankruptcy are the two most common types of personal bankruptcy filings. Chapter 7 bankruptcy can wipe out unsecured debts like credit card debt and medical bills in just 3-4 months. Though the filing can stay on your credit report for 10 years. You must pass a means test and meet certain criteria to qualify for Chapter 7. Chapter 13 takes longer — usually 3-5 years — because filers are on a repayment plan. After the plan is up, any remaining unsecured debt is discharged. Chapter 7 can stay on your credit report for up to 7 years. Some filers choose Chapter 13 because they don’t qualify for Chapter 7 or because they own certain assets they want to protect. Even though there are differences between Chapter 7 and Chapter 13 bankruptcy, each one grants the filer a fresh financial start in the form of a bankruptcy discharge — a court order that relieves you of your debt and bans creditors from trying to collect from you on this debt.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated January 30, 2025

The Trustee's Report of No Distribution, or NDR, lets the court and all interested parties know that no money will be paid to creditors.

Written by Attorney Eva Bacevice. Legally reviewed by Attorney Andrea Wimmer
Updated April 10, 2025

If you’re married, you can file bankruptcy without your spouse. But doing so doesn’t mean your spouse won’t be impacted. Before you choose whether to file individually or jointly, you’ll want to consider many factors, including what debts and assets you have together, whether you co-mingle your finances, and if there’s a prenuptial agreement.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated March 12, 2025

From filing to discharge (wiping out debts), Chapter 7 bankruptcy cases typically take 4–6 months. As far as personal bankruptcies go, Chapter 7 is the fastest. By comparison, Chapter 13 takes 3–5 years because a repayment plan is involved. If you file Chapter 7, the timeline for discharge will depend on how complicated your case is, what kind of debt you have, and how quickly you complete the requirements like the financial management course.

Written by Attorney Karra Kingston. Legally reviewed by Jonathan Petts
Updated March 10, 2025

Bankruptcy trustees use your bank statements to ensure your financial information is accurate and complete. They’ll check your balance on the filing date, review deposits and withdrawals, and look for unlisted accounts or assets. Trustees also verify your income and watch for preferential payments, which are transactions that unfairly favor one creditor over others. If the trustee requests additional documents or explanations, it’s important to comply to keep your case moving forward. Being transparent and cooperative helps ensure a smoother path to a financial fresh start.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated January 28, 2025

Chapter 7 bankruptcy is a powerful tool that wipes out common consumer debts, including credit card debt, medical bills, personal loans, payday loans, unpaid utility bills, and more. Some debts, like child support and alimony, can’t be discharged in bankruptcy.

Written by Attorney Jenni Klock Morel. Legally reviewed by Jonathan Petts
Updated March 13, 2025

After you file for bankruptcy, the court immediately issues an automatic stay, which stops most collection actions. Your case is assigned to a trustee who reviews your financial situation and oversees the sale of non-exempt assets in Chapter 7 cases. You'll attend a meeting of creditors, where you answer questions under oath about your finances. If your filing is approved, your eligible debts are discharged, meaning you don’t have to repay them.

Written by Mae Koppes. Legally reviewed by Jonathan Petts
Updated March 10, 2025

Your bankruptcy case may be dismissed if you don't complete all your obligations as a bankruptcy filer under the Bankruptcy Code. This includes filing all the required documents correctly and completely, doing your required credit counseling and debt management courses, and going to the 341 meeting with your trustee. If you file Chapter 13, you also need to stick with your approved repayment plan. If you don't do all this, you risk having your case dismissed.

Written by the Upsolve Team. Legally reviewed by Jonathan Petts
Updated February 1, 2025

After your 341 meeting, you’re in the final stages of your Chapter 7 bankruptcy case. The court will typically grant your discharge 60–90 days later, wiping out most or all of your eligible debts and giving you a fresh financial start. If the trustee determines your case is a no-asset case, it will likely be closed soon after the discharge is entered. However, if the trustee finds non-exempt assets, the process may take longer as they work to distribute funds to creditors, though your discharge won’t be affected.

Written by Ben Jackson. Legally reviewed by Jonathan Petts
Updated March 10, 2025

A bankruptcy discharge is a court order that permanently eliminates your legal obligation to repay certain debts. It also prevents creditors from trying to collect them. In Chapter 7 bankruptcy, filers are typically discharged within a few months. In Chapter 13, the bankruptcy discharge occurs after you complete a 3–5-year repayment plan. Most unsecured debts like credit cards, medical bills, and personal loans can be discharged. Some debts — such as child support, alimony, and recent taxes — can’t. Once you receive your discharge, you can focus on rebuilding your financial future by checking your credit report, creating a budget, and using credit responsibly.

Written by Kristin Turner, Harvard Law Grad. Legally reviewed by Attorney Andrea Wimmer
Updated March 13, 2025

Chapter 7 bankruptcy typically takes 4–6 months, with key milestones along the way. It’s an effective form of debt relief that can wipe out unsecured debts like credit card debt and medical bills. This article overviews what to expect as you prepare for your Chapter 7 case and what happens after you file bankruptcy.

Written by Mae Koppes. Legally reviewed by Attorney Andrea Wimmer
Updated March 13, 2025

When filing bankruptcy for the first time, many people get confused about the different terms lawyers and courts use. Two words that frequently confuse first-time filers are “dismissed” and “discharged.” This article explains each term, what the differences are, and when lawyers and the court are most likely to use them when referring to your case.

Written by Jonathan Petts. Legally reviewed by Ben Jackson
Updated March 13, 2025

Bankruptcy doesn't have to be expensive or confusing. You can use do-it-yourself Chapter 7 bankruptcy software online. Check out Upsolve to get started with our free bankruptcy process.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated January 30, 2025

The Chapter 7 bankruptcy rules are not as difficult to understand as you might believe, but there’s quite a few of them. Keep reading to get a basic understanding of the Chapter 7 bankruptcy rules and ensure a successful Chapter 7 bankruptcy filing.

Written by Ben Jackson. Legally reviewed by Jonathan Petts
Updated March 12, 2025

Deciding to file Chapter 7 bankruptcy should involve a review of everything that is required to successfully get a bankruptcy discharge after the bankruptcy filing. What follows is an overview of the requirements to file Chapter 7 bankruptcy and the requirements to getting your Chapter 7 discharge.

Written by the Upsolve Team. Legally reviewed by Lawyer John Coble
Updated March 10, 2025

The 341 meeting of creditors is a required meeting between a bankruptcy filer, the bankruptcy trustee, and sometimes creditors. It's an informal hearing often held virtually. Even when in person, it's not in a courtroom and no judge is present. The main purpose of the meeting is for the trustee to verify the bankruptcy filer's identity and the information in their bankruptcy forms. Creditors can also attend and ask questions, but this isn't common in Chapter 7 cases.

Written by the Upsolve Team. Legally reviewed by Lawyer John Coble
Updated January 30, 2025

Bankruptcy has gotten a negative reputation over the years. But there are many benefits to filing for bankruptcy that don't get as much attention as the drawbacks. Depending on your situation, filing bankruptcy can sometimes be the best course of action.

Written by Jonathan Petts. Legally reviewed by Ben Jackson
Updated January 30, 2025

Many people worry that filing bankruptcy will have a negative impact on their housing, job, and other important opportunities. The truth is that the vast majority of bankruptcy filers keep their day-to-day lives intact without issue. The law protects you from being fired for filing bankruptcy, and you can still receive public benefits.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated January 30, 2025

If you’re planning to get married and you also need to deal with debt, you’re probably wondering when to file bankruptcy and how it will affect your spouse. There are pros and cons to filing for bankruptcy before marriage as well as filing after marriage. If you want to start your marriage with a clean financial slate and you qualify for Chapter 7, that’s a relatively quick way to achieve that goal. If you already have joint debts with your spouse-to-be, you may want to file after you get married to take advantage of more generous exemptions.

Written by Attorney Paige Hooper. Legally reviewed by Jonathan Petts
Updated January 28, 2025

An emergency bankruptcy filing is when you file only the minimum required forms to get a bankruptcy case going. It helps you file your case quickly. Emergency filings are helpful if you need to stop serious collection measures like repossession, foreclosure, or wage garnishment. Once you file an emergency bankruptcy case, you need to complete the remaining paperwork within 14 days or you risk having your case dismissed.

Written by Jonathan Petts. Legally reviewed by Ben Jackson
Updated January 30, 2025

The court sends this document to the creditors you listed on your bankruptcy paperwork when you file. It gives each creditor important information about your case and tells them what they need to do if they have a reasonable objection to your bankruptcy.

Written by Jonathan Petts.
Updated July 30, 2020

Whether the trustee can take money you receive after filing your case depends on whether you were entitled to the money at the time your case was filed and how it was listed on your forms, if at all.

Written by Curtis Lee, JD. Legally reviewed by Jonathan Petts
Updated January 30, 2025

If a debt collector contacts you after you've filed your bankruptcy case, you'll first want to make sure they know about your case. If it's been less than two weeks since you filed, they may not have been informed yet. If they weren't aware, let them know. If they indicate they know you filed bankruptcy but they refuse to stop trying to collect the debt, you can notify the bankruptcy court or speak with an attorney. Creditors aren't allowed to contact you after you file your case because of the automatic stay.

Written by Amy Carst. Legally reviewed by Attorney Andrea Wimmer
Updated September 3, 2020

Every individual seeking bankruptcy relief must complete two educational courses: The credit counseling course is completed before the bankruptcy petition is filed with the court. The second course, on the other hand, can’t be completed until after the case has been filed. Without completing both courses, a bankruptcy filer cannot get their bankruptcy discharge. Here are 3 things you should know about the personal financial management course, including how it's different from credit counseling.

Written by Attorney Jenni Klock Morel. Legally reviewed by Jonathan Petts
Updated January 30, 2025

If you make a mistake or accidentally leave information out of your bankruptcy forms, you can almost always amend them after you file. The trustee in your bankruptcy case may also ask you to file an amendment after meeting with you in your 341 meeting. Be sure to fill out the amended forms carefully with the correct information and follow any local court rules to submit the amended forms. Most amended forms don't require a filing fee.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated January 30, 2025

The automatic stay goes into effect as soon as your bankruptcy petition has been filed with the court and a case-number assigned to your case. The automatic stay prohibits creditors from trying to collect a debt from you. Creditors and their attorneys know that the bankruptcy court can order them to pay sanctions to the bankruptcy filer if they violate the automatic stay.

Written by Curtis Lee, JD. Legally reviewed by Jonathan Petts
Updated January 30, 2025

If your bankruptcy trustee is asking your creditors to file a proof of claim, it’s likely because the trustee discovered non-exempt assets in your case. Most Chapter 7 bankruptcy cases are no-asset cases. But if you have non-exempt property or assets, the trustee can liquidate or sell them. The funds from the sale are then used to repay your creditors at least part of what you owe. If a creditor wants to recover money through the liquidation process, they have to file paperwork called a proof of claim.

Written by Jonathan Petts. Legally reviewed by Ben Jackson
Updated January 30, 2025

Creditors and debt collector aren't allowed to contact you after you file your bankruptcy case with the court. If a creditor contacts you anyway, it's usually by mistake. Answer the phone, tell them about your pending bankruptcy, and request that they stop calling. If they continue to contact you, let the court know right away, so they can put an end to it immediately and, if appropriate, punish the creditor for their conduct.

Written by the Upsolve Team. Legally reviewed by Attorney Paige Hooper
Updated January 30, 2025

If you own property that's not protected, or not fully protected, by exemptions, you may owe money to your bankruptcy estate. You can either pay the money into the estate and keep the property or asset, or you can surrender the property, keep the exempted amount, and not have to pay into the estate.

Written by the Upsolve Team. Legally reviewed by Jonathan Petts
Updated January 30, 2025

Filing bankruptcy gives you immediate protection from your creditors and a financial fresh start by wiping out certain debts like credit card debt, payday loans, and medical debt. If your wages are being garnished or credit card companies and payday lenders are harassing you to collect payments you can't afford to pay, filing bankruptcy may be the best way to get permanent relief. But if most of your debts are non-dischargeable, filing bankruptcy may not be worth it.

Written by Attorney Paige Hooper. Legally reviewed by Jonathan Petts
Updated January 30, 2025

If you and your spouse are filing a joint bankruptcy, you have to include their income and expenses on all of the required bankruptcy forms. If you and your spouse live together, but your spouse isn’t filing bankruptcy with you, you still need to include their income and expenses on Schedules I and J and your Statement of Current Monthly Income.

Written by the Upsolve Team. Legally reviewed by Attorney Paige Hooper
Updated March 10, 2025

In your 341 meeting of creditors, the trustee in your case will verify your identity and the information in your bankruptcy petition. Creditors can also show up to ask questions, but this is rare. In this article and video, we’ll walk you through a typical 341 meeting of creditors in a Chapter 7 bankruptcy.

Written by Curtis Lee, JD. Legally reviewed by Jonathan Petts
Updated January 30, 2025

You need to meet certain eligibility requirements to file Chapter 7 bankruptcy. If your income is higher than the median income for a similar-sized household in your state, this flags the bankruptcy court of a "presumption of abuse." This doesn't mean you can't file Chapter 7 or that you've abused the system. It does mean you must do more calculations as part of the means test to prove that you don't make enough money to repay your debts and that you aren't taking advantage of the bankruptcy process.

Written by Attorney Andrea Wimmer.
Updated July 22, 2020

There are two locations in your bankruptcy forms where income has to be disclosed, the means test and your Schedule I. This article explores whether and when you should include social security benefits your child receives as part of your household income in your bankruptcy forms.

Written by Attorney Jenni Klock Morel. Legally reviewed by Jonathan Petts
Updated January 30, 2025

You can file bankruptcy as many times as you need to, but you usually have to wait between filings. The waiting period depends on several factors, including whether the initial bankruptcy case was dismissed or discharged, what chapter you filed in the first case, and what chapter you plan to file in your second bankruptcy case.

Written by Attorney Eva Bacevice. Legally reviewed by Jonathan Petts
Updated December 10, 2024

The automatic stay is one of the biggest benefits of filing for bankruptcy. It provides immediate protection from creditors by halting collection calls, wage garnishments, repossessions, and foreclosures. This legal shield gives you breathing room to address your debts through the bankruptcy process. If the automatic stay is lifted, it means a creditor has successfully petitioned the bankruptcy court to remove these protections for a specific debt. Once the stay is lifted, that creditor can resume collection actions for that debt, such as repossessing your car or foreclosing on your home.

Written by Attorney Paige Hooper. Legally reviewed by Jonathan Petts
Updated March 13, 2025

If you receive disability benefits, they can impact your bankruptcy in two key ways: how your income is reported and whether any unspent funds in your bank account are protected. Social Security disability benefits (SSDI and SSI) must be included on bankruptcy forms like Schedule I, which helps determine whether you can afford your expenses, but they aren’t counted in the means test calculation. VA disability benefits don’t need to be listed on the means test form but must be reported on Schedule I. While ongoing disability benefits are generally safe in bankruptcy, any unspent funds — especially lump-sum back payments — may require a specific exemption to protect them from creditors.

Written by Lawyer John Coble. Legally reviewed by Jonathan Petts
Updated January 30, 2025

If you’re a parent, your children are the most important parts of your life. You don’t want to do anything that could harm their futures. If you’re considering bankruptcy, you may be worried about the impact this will have on your children. The good news is that for those who need to file bankruptcy, the positive impact on your family will far outweigh any inconveniences. This guide examines the issues that could impact your minor children.

Written by Attorney Jenni Klock Morel. Legally reviewed by Jonathan Petts
Updated March 10, 2025

Not much can truly go wrong at the meeting of creditors. To avoid any potential issues, make sure to bring approved documents to prove your identity and Social Security number, read the Bankruptcy Information Sheet, and review your bankruptcy petition so you can answer any questions the trustee may have about your case. If someone from the U.S. Trustee's office or a creditor's attorney shows up to ask questions, try to stay calm and just answer their questions truthfully.

Written by the Upsolve Team. Legally reviewed by Attorney Andrea Wimmer
Updated January 30, 2025

Filing bankruptcy is a very document intensive process. In this article, we’ll look at what documents you’ll need to gather to ensure your case proceeds smoothly and without unnecessary complications.

Written by the Upsolve Team. Legally reviewed by Lawyer John Coble
Updated October 12, 2022

If you're self-employed (as a sole proprietor, gig worker, or independent contractor) and you're struggling with business or personal debt, you can file personal bankruptcy like Chapter 7 or Chapter 13. If you have a separate business entity like an LLC or corporation, you also have the option to put your business into bankruptcy.

Written by Attorney Jenni Klock Morel. Legally reviewed by Jonathan Petts
Updated January 30, 2025

Once you’ve decided to file bankruptcy, it’s a good idea to stop using your credit cards as soon as possible. Many experts suggest avoiding new charges at least 90 days before filing. Using credit cards too close to filing can create problems, especially if the court thinks you made charges knowing you wouldn’t pay them back. Stopping early can help make the process smoother and protect your path to a fresh start.

Written by the Upsolve Team. Legally reviewed by Jonathan Petts
Updated January 30, 2025

If you're self-employed, you probably don't get regular paycheck stubs. This can make it trickier to figure out your income, which you'll need to do to file for bankruptcy. You'll also want to know your business expenses, so you can calculate your net income. This article explains how to calculate your income if you're a sole proprietor, gig worker, or independent contractor.

Written by the Upsolve Team. Legally reviewed by Lawyer John Coble
Updated May 4, 2022

Completing your meeting of creditors is a milestone in the bankruptcy process. But you still need to finish your financial management course and submit your certificate of completion to the court (if you haven't already). You also have to wait for some court-required deadlines to pass and comply with any information requests from your trustee. Though it won't apply to every filer, if you have an installment payment plan for the court filing fee or you're entering into a reaffirmation agreement with a creditor, you'll need to follow up on those as well.

Written by the Upsolve Team. Legally reviewed by Attorney Andrea Wimmer
Updated January 30, 2025

A bankruptcy discharge date marks the end of your bankruptcy case. It happens when a judge signs the order erasing your responsibility to repay certain debts, like credit card bills or medical expenses. This date is listed on the discharge order, which the court will mail to you. Chapter 7 cases usually take 3–6 months, while Chapter 13 cases require completing a 3–5-year repayment plan before you can receive your discharge. Completing required steps, like the debtor education course, ensures there are no delays.

Written by Attorney Paige Hooper. Legally reviewed by Jonathan Petts
Updated January 30, 2025

A bankruptcy discharge order is a court order that stops creditors from ever being able to collect on dischargeable debts. Despite this powerful court order, some collection agencies or creditors try to collect on discharged debts, which is illegal. If you’re contacted about a discharged debt, tell the debt collector you filed bankruptcy and the debt was discharged. If a debt collector sues or threatens to sue for a discharged debt, respond by letting them know about your discharge. You may even be able to counter sue for damages.

Written by Attorney Paige Hooper. Legally reviewed by Jonathan Petts
Updated January 30, 2025

Some people believe telling their creditors they plan to file bankruptcy will stop collection efforts or help them settle their debt. This often isn’t the case though. Telling your creditors about a pending bankruptcy filing can have negative consequences like repossession or ramped-up collection efforts. Read this article to learn more about the pros and cons of telling your creditors that you plan to file bankruptcy.

Written by Attorney Paige Hooper. Legally reviewed by Jonathan Petts
Updated January 30, 2025

The majority of bankruptcy filers provide the most accurate financial information they can to the court and bankruptcy trustee. But incorrect information can still find its way to the bankruptcy proceeding. Most of the time, these mistakes are accidental, but sometimes they’re deliberate. To help find these mistakes, the U.S. Trustee Program hires outside auditing companies to conduct a detailed review of select bankruptcy petitions.