Recent changes in U.S. law made declaring bankruptcy a much more complicated matter. Chapter 7 is the most common form of bankruptcy requested by debtors and does not require repayment. However, the U.S. Trustee has become much more aggressive in denying Chapter 7 bankruptcy, and instead forcing people into a Chapter 13 bankruptcy that does require repayment. Today you need much more from your law firm to get your Chapter 7 petition approved.

Under the new regulations, the government requirements to obtain a Chapter 7 bankruptcy are:

# Obtaining a Special Edition Credit Report of your obligations

# Transfers of your accounts to collection agencies

# Third-party assignees and if any judgments have been obtained against you

# Obtaining a copy of your IRS Tax Transcripts

# The Pre-Filing Credit Class

# Performance and certification of the Financial Means Test

# Preparation and filing of your petition

# Payment of all court filing fess;

# Representation at court hearings (as known as the Meeting of Creditors)

# A copy of your official filed bankruptcy petition

# And the Post-Filing Credit Class.

Arguably the most difficult and the most critical part of the Chapter 7 process is the new “means test.” The means test compares the debtor’s income in the six months before the filing of the bankruptcy to their state’s median income. If the debtor’s income falls below the state median, they are automatically allowed to file for bankruptcy under Chapter 7. If the debtor’s income is above their state’s median income, they may still qualify to file for Chapter 7, but it becomes more complicated process with additional tests that take their expenses and excess income into account.

Another crucial step in getting your Chapter 7 bankruptcy petition approved is the “341 creditors meeting.” The meeting takes place one to three months after the bankruptcy petition is filed, the 341 creditors meeting takes place, which allows creditors the chance to gain additional information about the debtor’s finances and ability to repay his debt. While you are not required to have a bankruptcy attorney, it is important to make sure you are prepared properly for the meeting.

Considering both the new and the old requirements, it may be in the best interests of a debtor to hire a law firm that has both bankruptcy lawyers and a professional accountant.

Look for other solutions first. Make sure you are really broke before you file for bankruptcy, because it will reflect on your credit record for as long as ten years. If you know what your credit record and credit rating is, then you’re aware that it can possibly hinder you from engaging in important financial transactions in the future, so make sure you think about this really well. In some countries enforcing bankruptcy laws, they are requiring everyone who is intending to file for bankruptcy to go through a credit counseling session to know if there may be other alternatives available for the person.

Hire a lawyer. Most people opt not to find a lawyer when filing for bankruptcy, but you’ll soon learn that hiring bankruptcy lawyers is a good decision on your part since filing entails knowledge of finances and legal details that may be difficult for you to handle by yourself. Make sure you hire a lawyer that you can communicate with constantly, because you need direct and constant supervision for your case.

Go over your case with your attorney. This is an important part of filing for bankruptcy. So that your lawyer knows what strategy to use in filing your petition, go over your case with him in as much detail as possible. Report all your income streams and expenditures for the past six months so that he’ll know what to write on your bankruptcy forms. Calculate the costs. The fees for filing for bankruptcy may vary depending on where you live. Some lawyers charge a flat rate for filing, while others measure the fee by taking a percentage of the amount of your debt. If you’re lucky to find a lawyer that charges the former, then good for you.

Refer all your creditors to your lawyer. After you’ve settled your fees and you have the lawyer on retainer, refer all your creditors to him and he will speak on your behalf. Once the petition has been filed, the “automatic stay” rule sets in, and no creditor can speak directly to you according to law. Creditors who violate this can be sought for damages on your part.

Wait for the creditors meeting. After filing the petition, you will be notified of the date of the creditors meeting, as prescribed by law. In this meeting, you will be asked to make a sworn statement about your petition, including your understanding that you are filing for bankruptcy.

Wait for the lapse of 60 days for your complete discharge. Your creditors have 60 days from the creditors’ meeting to contest your discharge of all debts. After 60 days, then you are no longer legally liable to pay these debts.

Remember, your filing of bankruptcy goes onto your permanent credit record, so think about it very carefully before deciding to file, in order to save future financial transactions.

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For more useful information on how to file bankruptcy, please visit Debt Relief Adviser.