Q: What steps do I need to take before I file for bankruptcy?

A: Under the new bankruptcy law, you must undergo credit counseling before filing for Chapter-7 or Chapter-13 bankruptcy. From there, you will be subject to your state's "means test" to determine if you are eligible for Chapter 7 (you must have income less than the state median). Then, before your bankruptcy becomes official, your creditors will have an opportunity to challenge your right to bankruptcy in court -- if you are anything less than 100% truthful, your bankruptcy motion may be denied.

These are the steps you need to take, legally, before you can file for bankruptcy. The steps you should take, in order to avoid making the wrong decision, are to consider every possible alternative to bankruptcy that there is. See more information about negotiating with your creditors, debt management, and debt settlement. Bankruptcy should always be the last option.

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