February 28, 2024

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Credit cards are a common means of payment for goods and services. They are easy to obtain, convenient to use, and provide a line of credit that can be helpful in times of financial need. However, ease of access to credit has led to an increase in credit card debt. In fact, according to the Federal Reserve, credit card debt in the United States has reached an all-time high of $1.09 trillion. For those who find themselves struggling under the weight of credit card debt, filing for bankruptcy may be a viable option. In this article, we will explore the process of filing for bankruptcy on credit card debt.

Understanding Bankruptcy


Bankruptcy is a legal process that allows individuals or businesses to discharge or restructure their debts. There are two main types of bankruptcy: Chapter 7 and Chapter 13.

Chapter 7 bankruptcy involves the liquidation of assets to pay off debts. Essentially, the debtor’s non-exempt assets are sold off to pay creditors. Any remaining debt is then discharged, meaning that the debtor is no longer responsible for it.

Chapter 13 bankruptcy, on the other hand, involves the reorganization of debts. The debtor creates a repayment plan that lasts between three and five years, during which time they make monthly payments to their creditors. At the end of the repayment period, any remaining debt is discharged.

Filing for Bankruptcy on Credit Card Debt

The process of filing for bankruptcy on credit card debt is relatively straightforward. Here are the steps involved:

1. Determine which type of bankruptcy is right for you. Chapter 7 is typically the best option for those with a significant amount of credit card debt and little in the way of assets. Chapter 13 might be a better option for those with significant assets or with income that makes them ineligible for Chapter 7.

2. Attend credit counseling. Before filing for bankruptcy, you are required to attend credit counseling. This is to ensure that you have explored all other options before resorting to bankruptcy. Credit counseling is typically a one-time session that can be done online or in person.

3. File the paperwork. Filing for bankruptcy involves completing several forms and submitting them to the court. These forms will include information about your income, assets, and debts.

4. Attend a meeting of creditors. Within a month of filing for bankruptcy, you will be required to attend a meeting of creditors. This is an opportunity for your creditors to ask questions about your financial situation.

5. Complete any required courses. Depending on the type of bankruptcy you file for, you may be required to complete financial management courses before your debts can be discharged.

6. Await your discharge. Once you have completed all the requirements, your debts will be discharged, and you will be free of your credit card debt.


Q: Will filing for bankruptcy eliminate all my credit card debt?

A: It depends. Chapter 7 bankruptcy can eliminate most unsecured debt, including credit card debt. Chapter 13 bankruptcy involves the repayment of debts, so not all credit card debt may be discharged.

Q: Will bankruptcy ruin my credit?

A: Yes, filing for bankruptcy will adversely affect your credit score and stay on your credit report for up to ten years.

Q: Will I lose all my assets if I file for bankruptcy?

A: No, exemptions exist that allow you to keep certain assets, such as your primary residence, vehicle, and personal items.

Q: Can I file for bankruptcy on my own, or do I need an attorney?

A: While it is possible to file for bankruptcy on your own, it is not recommended. Bankruptcy law is complex, and the consequences of mistakes can be severe. It is best to seek the advice of an experienced bankruptcy attorney.


Filing for bankruptcy on credit card debt is a significant decision that should not be taken lightly. While bankruptcy can provide relief from crippling debt, it can also have long-lasting consequences on credit and financial standing. If you are considering bankruptcy, it is essential to seek the advice of an experienced bankruptcy attorney to ensure that you make the best decision for your financial situation.

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Article Summary:

Credit card debt has reached an all-time high of $1.09tn in the United States, leading many to consider filing for bankruptcy. Bankruptcy is a process which allows individuals or businesses to discharge or restructure their debts and is available in two forms: Chapter 7 and Chapter 13. Chapter 7 sees assets liquidated to pay off debts while Chapter 13 involves the reorganisation of debts, with a debtor repaying creditors over a period of time. Anyone wishing to file for bankruptcy on credit card debt should first attend credit counselling, with options including Chapter 7 and 13 available depending on your financial situation.

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