Federal courts have exclusive jurisdiction over bankruptcy cases. Bankruptcy cases cannot be filed in state court.

The primary purposes of the law of bankruptcy are: (1) to give an honest debtor a "fresh start" in life by relieving the debtor of most debts, and (2) to repay creditors in an orderly manner to the extent that the debtor has property available for payment.

A bankruptcy case is commenced by the filing of a petition. You must also file a statement of your assets and liabilities, and schedules listing your creditors.

There is a range of filing fees for bankruptcy cases, depending on the chapter of the bankruptcy code under which you file.

Chapter 7, Liquidation, by far the most common form filed by individuals, involves an almost complete liquidation of the assets of the debtor, as well as a discharge of most debts.

Chapter 13, entitled Adjustment of Debts of an Individual With Regular Income, is designed for an individual debtor who has a regular source of income.  Chapter 13 is often preferable to Chapter 7 because it enables the debtor to keep a valuable asset, such as a house.  It allows the debtor to propose a "plan" to repay creditors over time--usually three to five years.  Unlike Chapter 7, the debtor does not receive an immediate discharge of debts.

Chapter 11, entitled Reorganization, ordinarily is used by commercial enterprises that desire to continue operating a business and repay creditors concurrently through a court-approved plan of reorganization.

(For more information, see www.uscourts.gov )