How to Discharge Debt in Illinois

Illinois and other states allow two options for discharging debt--filing for Chapter 7 bankruptcy or Chapter 13 bankruptcy. The difference with filing for bankruptcy in Illinois to discharge debt is that some items are exempt, such as a homestead of up to $7,500, and more debts are dischargeable under Chapter 13 than filing for Chapter 7 bankruptcy. When you're ready to file for bankruptcy to discharge debt, there are some necessary steps.

Instructions

1

Obtain a bankruptcy petition form. Contact the Illinois bankruptcy court that has jurisdiction over the county where you live to obtain the form for filing for bankruptcy. The Illinois bankruptcy court is divided into three areas--North, Central and South (see Resources section).

2

Complete a "Reaffirmation Agreement." For any property or assets that you intend on keeping when filing for bankruptcy, the state of Illinois requires you to sign a reaffirmation agreement. For example, if your home is excluded from the bankruptcy, complete and submit a reaffirmation agreement for your home with your bankruptcy petition form.

3

Submit the petition, documentation and reaffirmation agreement. Support the petition to file for bankruptcy; the reaffirmation agreement (if applicable); a list of assets, liabilities; income and expenses; a description of your financial situation; a list of executed contracts and unexpired leases including your mortgage; and copies of your last two years' tax returns, to the court that has jurisdiction in your area--Illinois Central District, Southern District or Northern District).

4

Pay the filing fee. Filing for bankruptcy in Illinois costs $274 to $299, depending on whether you're filing for Chapter 7 or Chapter 13. It is mandatory to include this fee with the petition, which can be paid to the Illinois clerk court when you file your paperwork in person.

5

Respond to trustee requests. An officer of the court, who is a trustee, will be assigned to your case and will be responsible for processing the petition and supporting information you supply. If the trustee has any questions or needs additional information, he will contact you. It's imperative that you respond to the trustee.

6

Attend the meeting of creditors. The trustee will arrange this meeting, which you are required to attend. You will be asked to respond to questions under oath, which is a process to assure that you understand the consequences of filing for bankruptcy to discharge debt.