Bankruptcy Generally

Bankruptcy is a form of debt relief you can obtain by filing a case in a federal bankruptcy court. There are three different types of consumer bankruptcy cases that an individual can file. Chapter 7 bankruptcy is liquidation; if you have nonexempt assets, a trustee will sell those assets to repay creditors. Chapter 13 is a repayment arrangement; you propose a repayment plan to the court and repay creditors over a three- to-five-year period. Chapter 11, also a repayment arrangement, is available to individuals who make too much money to file Chapter 7 and who have too much debt to file Chapter 13. While businesses file Chapter 11 more often than individuals, Chapter 11 is still an individual option.

The Petition Generally

A bankruptcy petition is Form B1 of the Official Bankruptcy Forms. The petition contains the debtor's name and any addresses, as well as the last four digits of the debtor's Social Security number or tax identification number. The petition indicates which chapter the case involves and whether the debts are primarily individual consumer debts or business debts. The petition has a summary of the amounts of the debtor's assets and liabilities. The debtor's attorney signs the petition to indicate that she has explained bankruptcy to the debtor, and the debtor signs the petition to indicate that all of the information he has provided is true and correct under penalty of perjury.

What the Petition Does

The date of the petition filing is the date the case starts. You may also see the court, the attorneys and the Bankruptcy Code refer to this day as the date of the Order of Relief. The date the debtor files the petition is the date on which all collection activity must stop. It is also the date by which creditors and the bankruptcy trustee measure the debtor's financial situation.

Amendments to the Petition

If you are a debtor and you realize your petition contains errors, such as a misspelled name or an incorrect address, you can amend your petition with the court at any time. Once you file an amended petition, the court will send notifications to all your creditors and to your trustee that you have made the changes. You will not be penalized for making inadvertent errors on your petition.

Documents to File With or After the Petition

If you are a consumer debtor, your petition includes an Exhibit D, which you must file at the same time as the petition. Exhibit D is a statement that you have completed pre-bankruptcy credit counseling. You must also file your Statement of Social Security Number with your petition. Once you file the petition and accompanying documents, you must file certain other documents within 14 days. These include your schedules, Statement of Financial Affairs and means test. If you are in a Chapter 7 case, you must file a Statement of Intention indicating whether you intend to keep or surrender your house, your car and any other property subject to secured loans. If you are in a Chapter 13 case, you must file your Chapter 13 plan. If you do not file all required documents on time, the court will dismiss your case.

Involuntary Petition

Three or more creditors can band together to file an involuntary petition in Chapter 7 or Chapter 11. The involuntary petition forces the debtor into bankruptcy. As the debtor, you can respond to such a petition if you do not join in on it. If you do not dispute the petition, the court will proceed with the bankruptcy.