Bankruptcy is an effective ways to deal with debts you are unable to pay. Once you declare that you are bankrupt, all assets in your possession will be used to pay your outstanding debts. You can either file your own petition of bankruptcy or have an attorney do it for you.

Filing your bankruptcy petition

Preparing to file bankruptcy will require you getting your documentation and statements showing proof of income and expenses together. A bankruptcy judge will require this information before making his or her decision of which debts will be discharged.

The paperwork will include required pay stubs which will show the amount of income you gross per month. You’ll also be required to prove your monthly expenses, including rent, utilities and grocery costs. Your statements showing credit card expenses, loans, taxes and unpaid medical bills will also be part of your paperwork to gather. The judge will then look over your income. Most often your assets and debts will be compared against your state’s median income. Some states have tougher standards for comparison than others. The comparison results will determine what type of bankruptcy you’ll qualify for.

Each state has its own list of specific assets that are eligible for exemption. It’s best to consult with a bankruptcy attorney when trying to figure out what you own that will qualify for exemption. Taking assistance from a bankruptcy attorney can ensure you’re doing everything you can to conclude your bankruptcy on the most positive note possible.

Bankruptcy petitions cannot be filed in any court. The petition must be filed in a court with jurisdiction. In the United States, bankruptcy cases have to be filed in Bankruptcy courts which are usually the Federal courts with jurisdiction to handle such matters. District courts also have jurisdiction over bankruptcy matters and may refer petitions to the bankruptcy court at any point by order.

A judge will determine the eligibility of the debtor for the form of petition filed and also if the debtor should be discharged of his debt obligations. Typically, a debtor who files for Chapter 7 bankruptcy has limited or no involvement with the bankruptcy judge and may not see him unless an objection is raised on the petition.

A typical United States Bankruptcy court will administer the federal bankruptcy law in order to meet congress goal for enacting the law which is to give debtors a "fresh start" while also protecting creditors from unfair exploitation.

If you are filing for bankruptcy, a bankruptcy attorney will know which courts will handle your case.