The short answer

The costliest bankruptcy mistakes are made in the months before filing: draining protected retirement savings to pay unsecured debt, moving property to family, paying one creditor ahead of others, and borrowing while insolvent. Each is an ordinary attempt to do the right thing that creates a problem a filing then has to absorb.

Your reading roadmap

01

Cashing out retirement savings to pay debt

This is the most common and most damaging pre-filing mistake. Retirement accounts frequently receive protection that the cash you convert them into does not, and there can be significant tax consequences on top. People do this precisely because they are trying to avoid filing — and then file anyway, having spent the asset that would have survived.

02

Transferring property to a relative for safekeeping

Moving an asset out of your name before filing is examined closely, and the Statement of Financial Affairs asks about it directly. What feels like protecting something for family reads very differently to a trustee. If an asset has already been transferred, disclose it and get advice — concealment is a far worse problem than the transfer.

03

Paying one creditor ahead of the others

A large payment to a family member, or to a favored creditor, in the period before filing can be recoverable by a trustee — sometimes from the person who received it. That means a payment made to protect a relationship can end with the relative being pursued. Disclose any recent large payment before filing rather than after.

  • Do not cash out retirement savings to pay unsecured debt
  • Do not transfer or gift property before getting advice
  • Do not pay one creditor a large amount ahead of others
  • Do not take on new credit while insolvent
  • Do not leave any debt off the schedules
  • Do not ignore a collection lawsuit while you decide

04

New borrowing shortly before filing

Recent borrowing and significant purchases before a filing can be challenged as not dischargeable, which means the debt survives while the rest is cleared. The instinct to use available credit while deciding what to do is understandable and it is exactly the pattern that draws scrutiny. Stop and get advice before taking on more.

05

Leaving something off the schedules

The schedules are signed under penalty of perjury, and completeness is not optional — including debts you intend to keep paying and accounts that feel private. Omissions damage credibility on everything else and can create problems for the treatment of the omitted debt. Amendments are possible, noticed, and better avoided.

06

Ignoring a lawsuit while deciding

A collection lawsuit's response deadline runs on its own schedule and does not pause while you consider bankruptcy. A default judgment entered in the meantime narrows your options even if you later file. Whatever else is happening, the deadline in the papers is the thing to address first.

07

Filing at the wrong moment

Timing genuinely matters. Filing before a scheduled foreclosure sale is a different thing from filing after it. Filing before an expected debt is incurred can leave that debt outside the case. Filing too soon after a prior case can limit the protections available. This is one of the clearest reasons to have the timing question reviewed rather than decided by urgency.

FAQ

Frequently asked questions

I already did one of these things. Is my case ruined?

Usually not, but the response matters. Disclose it fully and early to whoever is helping you, so it can be addressed in the filing rather than discovered by the trustee. Most of these situations have established ways of being handled; concealment is what converts a manageable problem into a serious one.

Can I keep paying my car loan and still file?

Secured debts require their own plan, and continuing to pay is one of the options generally discussed — alongside restructuring through chapter 13 or surrendering the property. What you cannot do is leave the debt off the schedules because you intend to keep paying it. Disclose it and ask how it should be handled.

Should I stop paying creditors once I decide to file?

Do not decide that alone, and be especially cautious about advice to stop communicating with creditors while a lawsuit deadline is running. The Consumer Financial Protection Bureau publishes guidance on debt collection and on responding when a collector sues, and that pattern — stop paying, stop responding — is a recognized warning sign in the debt relief market.

Official forms and preparation tools

Get organized before you file or ask for help.

Use the preparation aids to collect information. Always obtain legal forms from the court or agency that controls them.

Preparation resourcesThis is a preparation aid, not a legal document. Nothing here is filed with a court or agency, nothing here is legal advice, and completing it does not establish that you have a claim, a defense, or an obligation. Use it to organize your own information so a conversation with a licensed attorney is more productive.
inventory

Debt and creditor inventory

Builds the complete creditor picture a bankruptcy consultation needs, and surfaces the debts people most often forget.

Open checklist

How to use it

  1. Work from statements and letters rather than memory
  2. List every debt, including ones you intend to keep paying
  3. Include debts owed to family, friends, and former partners
  4. Note anything already in collection, judgment, or garnishment
  5. Flag any debt where someone else also signed
  6. Bring the completed list, not the underlying pile, to a consultation

Secured debts

Secured debts are treated differently because the creditor can pursue the property itself.

  • Mortgage or deed of trust, with the servicer and any arrears
  • Vehicle loans, with lender and payoff information
  • Furniture, electronics, or equipment financing tied to the item
  • Any loan where specific property was pledged

Unsecured debts

  • Credit cards, with issuer and account balance
  • Medical bills, including accounts already sent to collection
  • Personal loans and lines of credit
  • Payday, title, or short-term high-cost loans
  • Utility and telecommunications balances

Debts that often get left off

Leaving a debt off a filing is a problem even when you intend to keep paying it.

  • Money borrowed from family or friends
  • Debts you co-signed for someone else
  • Debts someone else co-signed for you
  • Homeowner or condominium association assessments
  • Overpayments a benefits agency says you owe
  • Amounts owed to a former landlord

Debts with special treatment

The federal courts identify categories that a discharge does not cover. List these separately so they can be discussed specifically.

  • Child support or spousal support obligations
  • Tax debts, with the year and taxing authority
  • Student loans, with servicer and loan type
  • Criminal fines, restitution, or court costs

Collection activity

Anything with a date attached should be raised at the very start of a consultation.

  • Lawsuits filed, with case number and court
  • Judgments already entered
  • Wage garnishments or account levies in progress
  • Scheduled foreclosure or repossession dates
  • Written validation notices received from collectors
Limitations

This is preparation, not a filing — official schedules have their own required format

Completing it does not indicate that bankruptcy is appropriate for you

It does not determine which debts would be discharged, which is a legal analysis

It is not a substitute for the official schedules or their instructions

worksheet

Bankruptcy consultation worksheet

Turns an hour with a bankruptcy attorney into an assessment rather than a fact-gathering session.

Open checklist

How to use it

  1. Fill in what you can and mark what you could not find
  2. Bring the completed worksheet and your creditor inventory
  3. Write your questions down before the meeting
  4. Take notes on the answers while they are fresh

Your situation in one page

  • What changed that made this urgent
  • Total approximate debt, and the largest three debts
  • Household income and how steady it is
  • Anything with a date: sale, garnishment, hearing, deadline

Property you would want to keep

  • Home, and whether payments are current
  • Vehicles needed for work or caregiving
  • Retirement accounts, with type and approximate balance
  • Tools of a trade or business equipment

Recent financial history to disclose

Trustees examine this period. Raising it early is far better than being asked about it later.

  • Property sold, transferred, or given away recently
  • Large payments to a single creditor or to family
  • Recent significant purchases or cash advances
  • Any prior bankruptcy filing, anywhere, and when
  • Money taken from retirement savings to pay debts

Questions to ask

  • Based on my income and property, which chapter appears to fit, and why?
  • Which exemptions apply in my state, and what would I keep?
  • Are any of my debts likely to survive a discharge?
  • Is there anything in my recent history a trustee will question?
  • What are the alternatives, and why is filing better here?
  • What does your fee include, and how are court and course fees handled?
  • What happens to my house or car if I file?

Before you leave

  • What is the very next step, and who takes it
  • What documents you still need to produce
  • What you should avoid doing between now and filing
  • What the timeline looks like from here
Limitations

Filling this in does not begin a case or preserve any deadline

It does not tell you which chapter fits, which requires an eligibility analysis

It is not legal advice and creates no attorney-client relationship

checklist

Bankruptcy document checklist

Lists the records a bankruptcy case is built from, so gathering happens before a deadline rather than during one.

Open checklist

How to use it

  1. Collect documents rather than summaries; the schedules run on figures
  2. Request anything missing early, since third parties are slow
  3. Keep a copy of everything you hand to anyone
  4. Note the date of each statement so nothing is stale at filing

Income

  • Recent pay statements for everyone in the household
  • Tax returns, including any business returns
  • Benefit, pension, or support income statements
  • Self-employment records and business bank statements

Property and value

  • Deeds, mortgage statements, and property tax records
  • Vehicle titles and loan statements
  • Bank, retirement, and investment account statements
  • Life insurance policies showing any cash value

Debts

  • Statements for every credit card, loan, and medical account
  • Collection letters and validation notices
  • Lawsuit papers, judgments, and garnishment notices
  • Payoff figures and arrears amounts on secured debts

Required course certificates

The U.S. Trustee Program approves providers and publishes searchable lists by state and judicial district. It does not endorse any particular provider.

  • Pre-filing credit counseling certificate from an approved agency
  • Debtor education certificate, which comes after filing
Limitations

Gathering documents does not begin a case or stop any collection activity

Districts have their own local requirements this list does not cover

It does not replace the official forms or their instructions

Official form referencesForm references are educational. Which form applies, whether it applies to you, and when it must be filed depend on your jurisdiction and your circumstances, and official forms are revised over time. Always obtain the current form from the issuing court or agency, read its official instructions, and confirm with a licensed attorney before relying on it.
Federal · Administrative Office of the U.S. Courts

B 101 — Voluntary Petition for Individuals Filing for Bankruptcy

The document that opens an individual bankruptcy case and identifies the debtor, the chapter being filed under, and basic case information.

Form guide
Who may need it

An individual, or married individuals filing together, who has decided with advice that filing is the right step. It is not a form to complete in order to find out whether filing is appropriate.

When generally used

At the start of a case. Federal law requires credit counseling from an approved agency before an individual may be a debtor, subject to very limited exceptions, so that step generally comes first.

Before starting
  • Full legal name and any other names used in recent years
  • Current address and the district where the case would be filed
  • Social Security or taxpayer identification number
  • Which chapter is being filed under, decided with advice
  • The credit counseling certificate or the basis for an exception
  • A complete picture of debts, property, income, and expenses for the schedules

What the sections ask for

Section explanations describe what a form is asking for in ordinary language. They are not instructions about what any individual should write, and they do not replace the official instructions published with the form.

Identify Yourself

Asks for legal names, other names used, and identifying numbers. Other names matter because creditors may hold accounts under a former or business name.

Tell the Court About Your Bankruptcy Case

Asks which chapter you are filing under, whether you have filed before, and how you propose to pay the filing fee.

Report About Any Businesses You Own

Asks whether you are a sole proprietor or hold business interests, which can change how a case is administered.

Report if You Own or Have Any Hazardous Property

Asks about property posing an immediate health or safety concern, so the court can act quickly if needed.

Explain Your Efforts to Receive a Briefing About Credit Counseling

Asks you to confirm the required pre-filing counseling was completed, or to state the basis for an exception.

Sign Below

The declaration is signed under penalty of perjury, and a non-attorney preparer who helped must also identify themselves.

Common mistakes

  • Filing before completing the required pre-filing credit counseling
  • Omitting former or business names creditors may have used
  • Filing the petition without the schedules and statements the case requires
  • Choosing a chapter without an eligibility analysis
  • Overlooking the district's own local rules and required local forms
Get the current form from Administrative Office of the U.S. Courts

Last source check: 2026-08-20 · awaiting attorney review

Federal · Administrative Office of the U.S. Courts

B 103A — Application for Individuals to Pay the Filing Fee in Installments

Asks the court for permission to pay the bankruptcy filing fee over time rather than in full when the petition is filed.

Form guide
Who may need it

An individual filer who cannot pay the fee in full at filing but does not qualify for, or is not seeking, a waiver.

When generally used

Filed with the petition.

Before starting
  • The current filing fee for the chapter being filed, from the official schedule
  • A realistic proposed payment schedule
  • Whether any payment has already been made to an attorney or petition preparer

What the sections ask for

Section explanations describe what a form is asking for in ordinary language. They are not instructions about what any individual should write, and they do not replace the official instructions published with the form.

Proposed payment schedule

Asks what amounts you propose to pay and when. Federal rule permits the court to authorize up to four installments.

Certification about payments to others

Federal rule provides that a debtor may not pay an attorney or a petition preparer until the filing fee is paid in full.

Common mistakes

  • Proposing a schedule that runs past what the rule permits
  • Paying an attorney or preparer while installments remain outstanding
  • Missing an installment, which can lead to dismissal
Get the current form from Administrative Office of the U.S. Courts

Last source check: 2026-08-20 · awaiting attorney review

Federal · Administrative Office of the U.S. Courts

B 103B — Application to Have the Chapter 7 Filing Fee Waived

Asks the court to waive the chapter 7 filing fee entirely.

Form guide
Who may need it

An individual filing under chapter 7 whose circumstances may meet the waiver standard. It is not available in chapter 13.

When generally used

Filed with the chapter 7 petition.

Before starting
  • Household income and size
  • Documentation supporting the income figures reported
  • The schedules of income and expenses, since the court considers the whole picture

What the sections ask for

Section explanations describe what a form is asking for in ordinary language. They are not instructions about what any individual should write, and they do not replace the official instructions published with the form.

Income and household information

Asks about household size and income so the court can apply the waiver standard, which is tied to federal poverty guidelines.

Certification and signature

Signed under penalty of perjury, like the rest of the filing.

Common mistakes

  • Assuming a waiver is available in a chapter other than chapter 7
  • Reporting income inconsistently with the schedules filed alongside
  • Treating a waiver application as automatically granted
Get the current form from Administrative Office of the U.S. Courts

Last source check: 2026-08-20 · awaiting attorney review

Federal · Administrative Office of the U.S. Courts

B 106A/B through B 106J — Schedules for Individuals: Schedule A/B Property; Schedule C The Property You Claim as Exempt; Schedule D Creditors Who Hold Claims Secured By Property; Schedule E/F Creditors Who Have Unsecured Claims; Schedule G Executory Contracts and Unexpired Leases; Schedule H Your Codebtors; Schedule I Your Income; Schedule J Your Expenses

The sworn inventory of what an individual debtor owns, owes, earns, and spends, together with the exemptions claimed.

Form guide
Who may need it

Every individual debtor. The schedules are where a case is actually made or broken.

When generally used

Filed with the petition or by the deadline the rules and the district set after filing.

Before starting
  • Every creditor, including debts owed to family and debts you intend to keep paying
  • Account statements for bank, retirement, and investment accounts
  • Deeds, titles, and current valuations for property
  • Recent pay records and a realistic monthly expense picture
  • Records of property transferred or sold recently
  • Which exemption scheme applies where you live

What the sections ask for

Section explanations describe what a form is asking for in ordinary language. They are not instructions about what any individual should write, and they do not replace the official instructions published with the form.

Schedule A/B — Property

A complete list of everything owned, not only significant items.

Schedule C — Exempt property

Where you claim the protections that decide what you keep. Which exemptions are available depends on state law.

Schedules D and E/F — Creditors

Separates debts tied to specific property from unsecured debts, and identifies priority claims within the unsecured group.

Schedules I and J — Income and expenses

The monthly picture of what comes in and goes out, which drives feasibility in a repayment case.

Common mistakes

  • Leaving a creditor off, including a relative or a debt you plan to keep paying
  • Guessing at property values instead of documenting them
  • Claiming exemptions under the wrong scheme for the state
  • Omitting recent transfers a trustee will examine
  • Inconsistencies between the schedules and the income and means test forms
Get the current form from Administrative Office of the U.S. Courts

Last source check: 2026-08-20 · awaiting attorney review

Federal · Administrative Office of the U.S. Courts

B 122A-1 and B 122A-2 — Chapter 7 Statement of Your Current Monthly Income; Chapter 7 Means Test Calculation

Reports current monthly income and, where required, works through the means test calculation that compares income to the applicable state median and applies allowed expense figures.

Form guide
Who may need it

Individual chapter 7 filers. Chapter 13 filers use the parallel B 122C forms.

When generally used

Filed with the petition or by the deadline set after filing.

Before starting
  • Income for every source over the defined look-back period
  • Household size as the form defines it
  • Documentation supporting each income figure
  • Secured debt payment information where the calculation reaches it

What the sections ask for

Section explanations describe what a form is asking for in ordinary language. They are not instructions about what any individual should write, and they do not replace the official instructions published with the form.

Current monthly income

A defined average over a look-back period, which is not the same as what you earn this month.

Comparison to state median

Compares your figure to the median for a household of your size in your state; the result determines whether the fuller calculation is required.

Means test calculation

Applies allowed expense standards and other deductions to determine whether a presumption of abuse arises.

Common mistakes

  • Using current earnings instead of the defined look-back average
  • Counting household size differently than the form requires
  • Treating the median comparison as the end of the analysis
  • Figures that contradict Schedules I and J
Get the current form from Administrative Office of the U.S. Courts

Last source check: 2026-08-20 · awaiting attorney review

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Keep in mind

Lawyer in Town publishes general legal information for consumers. It is not legal advice, it does not create an attorney-client relationship, and it cannot account for the facts of any individual situation. Laws, court procedures, filing deadlines, and outcomes differ by state and by court, and they change over time. Confirm anything that affects a decision with a lawyer licensed in the relevant jurisdiction.

Federal framework. Exemptions protecting retirement and other property depend on state law, look-back periods for transfers and preferences are defined by federal law, and collection procedures are state law. No period, threshold, or figure is stated.