What Are the Steps to File for Chapter 7 Bankruptcy?

Gather your documents

You will need many documents. Gather them before filing. If you do not provide everything, the court may dismiss your case.

You will typically need:

• Pay stubs from the last six months
• Tax returns from the last two years
• Bank statements
• A list of all your debts, including names, account numbers, and amounts
• A list of everything you own
• Recent bills and notices from creditors (the people or companies you owe money to)

For more information on documents you may need, use this checklist. Not all of the documents in the list may be required, but being prepared is a great way to avoid stress and additional costs associated with gathering documents at the last minute.

Do not hide anything. If you forgot something or made a mistake, tell your lawyer. There is almost always a fix. Hiding assets on purpose is bankruptcy fraud. The FBI investigates bankruptcy fraud.

Complete pre-filing credit counseling

Before you can file, you must complete a credit counseling course. This is required by federal law.

The course must come from an approved provider. It usually takes about one hour. Many providers offer it online or by phone. Free or low-cost options are available.

You will receive a certificate when you finish. You must include this certificate when you file.

Ask your bankruptcy lawyer for names of approved free or low-cost credit counseling providers for Virginia.

File your case

Your lawyer files the case with the bankruptcy court. If you qualify for a fee waiver, your lawyer will help you request it.

The automatic stay typically begins the day you file. This means all collection activity stops right away. Creditors cannot garnish your wages, foreclose on your home, or call you to collect.

Attend the trustee meeting (the 341 meeting) 

After filing, you will have a meeting with the trustee. This is called the "341 meeting of creditors." The trustee is a court-appointed official who checks that what you declared is accurate. Think of the trustee as a referee.

Here is what to expect at the meeting:

• Location: It usually takes place at a courthouse when court is not in session, or at a city office. You are not in court, even if it feels that way.
• What to bring: Your photo ID and your Social Security card. You must have both.  (If you do not have one of those documents, talk to your bankruptcy lawyer well in advance about documents that could be substituted).
• What happens: You will be sworn in and asked questions. The questions are predictable. Your lawyer will have prepared you for them in advance.
• Creditors: Creditors are allowed to attend, but they rarely do in low-income Chapter 7 cases.
• After the meeting: The trustee confirms whether you have any non-exempt assets.

Complete post-filing financial counseling

After filing, you must complete a second required course on personal financial management. You need a certificate from this course to get your discharge.

Again, ask your bankruptcy lawyer which credit counseling course they recommend you use.  Free or low-cost options may be available.  For the post-filing counseling, most bankruptcy filers are inundated with ads for other counseling services, which may be more expensive than what your lawyer recommends.  Stick with the one your bankruptcy lawyer recommends.  

Receive your discharge

After completing all steps, the court grants your discharge. Your debts are wiped out. You get a fresh start.

There are a few important things to know after your discharge.

• Check your credit reports. Make sure your discharged debts are marked correctly. You are entitled to free credit reports.
• Use credit wisely going forward. For guidance on rebuilding your finances after bankruptcy, see NCLC’s Surviving Debt guide.
• Inherited property after discharge: If you inherit property within 6 months of your discharge, you must report it to the court and turn it over to your creditors. This is an important rule. If this situation applies to you, contact your bankruptcy lawyer right away.