📅 2026 Update: Changes in U.S. Bankruptcy Law

Since the original article was published, several important updates have occurred in U.S. bankruptcy law. These changes impact how individuals and businesses file for bankruptcy and what to expect during the process. The earlier article continues further down the page, providing a comprehensive overview of bankruptcy procedures.

🆕 📈 Means Test Adjustments

In 2025, the U.S. Department of Justice updated the median income figures for the Chapter 7 means test. This change affects who can qualify for Chapter 7 bankruptcy.

If an individual's income is below the new median, they may be eligible for Chapter 7. Those above the median will have to consider filing under Chapter 13 instead.

🏠 💰 Exemption Updates

Several states revised their bankruptcy exemptions in 2024. This included increases to homestead exemption limits to help protect a debtor's home equity from creditors. Understanding state-specific exemptions is crucial for those considering bankruptcy, as it can affect asset protection during the filing process.

🔒 ⏳ Automatic Stay Provisions

In 2026, the Bankruptcy Abuse Prevention and Consumer Protection Act was amended. This amendment extends the automatic stay period for certain debtors from 30 days to 60 days. The automatic stay halts most collection actions once bankruptcy is filed, providing immediate relief to debtors during the process.

💵 📉 Current Fees and Costs

As of October 2026, the filing fee for Chapter 7 bankruptcy is $338. For Chapter 13 bankruptcy, the filing fee is $313. Additionally, debtors must complete a credit counseling course, which typically costs between $20 and $50.

These costs can play a significant role in deciding to file for bankruptcy.

📋 📝 Summary of Key Points

  • Means test updated with new median income figures in 2025.
  • Exemptions increased to protect home equity in several states.
  • Automatic stay period extended from 30 to 60 days in 2026.
  • Filing fees for Chapter 7 and Chapter 13 bankruptcy remain at $338 and $313, respectively.
  • Credit counseling course costs range from $20 to $50.

💡 Practical Tips for Filing Bankruptcy

Review the details of your situation with your attorney. Understanding your specific circumstances is essential for navigating bankruptcy effectively.

📅 ⏳ Complete Credit Counseling

Before filing for bankruptcy, complete the required credit counseling course. This course must be completed within 180 days prior to your filing. It’s a necessary step that helps you understand your financial situation better.

🗂️ 📄 Gather Financial Documents

Collect all necessary financial documents before starting the filing process. This includes income statements, tax returns, and a list of debts and assets. Having everything ready can simplify the filing process.

✍️ 📝 Fill Out Bankruptcy Forms

Use the official bankruptcy forms available on the U.S. Courts website. These forms can be downloaded for free.

Properly filling out these forms is crucial for a successful bankruptcy filing.

👥 📅 Attend the Meeting of Creditors

After filing, you will need to attend the 341 meeting of creditors. This meeting allows creditors to ask questions about your financial situation. It’s an important part of the process and should not be overlooked.

🎓 📚 Complete Debtor Education

After the 341 meeting, complete a debtor education course. This course must be finished before you can receive a discharge of eligible debts. It’s designed to help you manage finances better in the future.

🏆 Credit Repair Services Ranked by User Reviews (2026)

This section covers credit repair services relevant to bankruptcy, focusing on debt management and credit restoration. The order is based on Trustpilot data from October 2026, and these scores can change over time. Ratings reflect customer experiences, and unhappy customers often leave more reviews, so consider this when evaluating services.

🥇 1. CreditRepair.com

CreditRepair.com holds a Trustpilot score of 1.2. This service is known for its credit repair and debt management services. However, many customers have reported complaints about service quality and billing issues, which may affect their overall satisfaction.

🥈 2. Lexington Law

Lexington Law has a Trustpilot score of 3.2. It offers credit repair and debt management services. Reviewers mention mixed experiences regarding service quality and have raised complaints about billing practices.

This variability can influence your decision when considering credit repair options.

🆓 Free Government or Nonprofit Help

Several approved credit counseling agencies offer free or low-cost counseling services. These agencies can provide assistance to those considering bankruptcy. Legal aid organizations in many states also offer free legal assistance to low-income individuals.

🔎 What to Compare When Choosing a Credit Repair Service

  • 🏷️ Check for Trustpilot scores and the number of reviews.
  • 📝 Look at service quality and user experiences.
  • 💰 Consider billing practices and any reported issues.
  • 📈 Evaluate success rates in improving credit scores.
  • 📞 Assess customer support options and availability.

❓ Frequently Asked Questions

❓ What is the means test in bankruptcy?

The means test determines eligibility for Chapter 7 bankruptcy by comparing your income to the median income in your state. If your income is below the median, you may qualify for Chapter 7; if above, you may need to file under Chapter 13.

🏠 Can I keep my home during bankruptcy?

Many states offer a homestead exemption that protects a portion of your home equity from creditors. The specifics can vary by state, so it’s important to check the exemptions available in your state.

🔒 How long does bankruptcy stay on my credit report?

Filing for bankruptcy can remain on your credit report for up to 10 years. This can impact your ability to obtain new credit during that time.

📅 What happens to my debts after filing?

Certain debts may be discharged after filing for bankruptcy, meaning you are no longer responsible for them. However, not all debts are dischargeable, such as student loans and certain taxes.

📚 Do I need to take courses before and after filing?

Yes, debtors are required to complete a credit counseling course before filing and a debtor education course after filing. Both courses are essential steps in the bankruptcy process.

🏛️ What is the role of the bankruptcy trustee?

A bankruptcy trustee is appointed to oversee the bankruptcy case. The trustee ensures that creditors receive payment from the debtor's estate and manages the administration of the case.

⚖️ Recent Court Rulings in Bankruptcy Cases

Recent court rulings have addressed various aspects of bankruptcy law, impacting how cases are handled. These decisions can affect eligibility, debt dischargeability, and exemption rules.

For further updates, browse more rulings on the news page.

End of October 2026 Update





Filling for bankruptcy can be a difficult thing to accept, however, this law was put into effect to protect people. Prior to filing bankruptcy, ensure that there are no other options. Once a person does file, bankruptcy stays on their credit records for up to ten years.  

If a person has no other option but to file, bankruptcy can come in two common types:  straight liquidation bankruptcy, or a repayment plan. A person should thoroughly research both options prior to filing for bankruptcy to ensure they are making the proper decision. If it is available, legal advice may be helpful.

After deciding which method an individual will utilize when filing for bankruptcy, they should then determine the fee that will be owed for filing. Fees can vary depending on the amount of debt and the type of bankruptcy one is filing. Filing can be done online, but if one chooses to do so it is suggested that fees not be paid using their credit cards.

How to File Bankruptcy?

After filing, an individual will then be faced with different meetings with creditors to determine the bankruptcy and how in depth it is. A creditor has up to 60 days to file a lawsuit against the individual who is filing bankruptcy if they feel there are fraudulent acts taking place resulting in the bankruptcy filing.

When filing for bankruptcy it is important to keep copies of all your documents as well as those from your lawyer. When filing for bankruptcy, your employer will not be notified unless they are a creditor. However, all filed bankruptcies are public records.