How to File Chapter 7 in New York, Step by Step

This is general information about how the Chapter 7 process works in New York. This firm does not file bankruptcy petitions.

Credit counseling comes first. Under 11 U.S.C. § 109(h) you cannot be a debtor unless you received a briefing from an approved nonprofit credit counseling agency during the 180-day period ending on the date you file. The exceptions are narrow: exigent circumstances (a 30-day waiver, extendable to 45), incapacity, disability, combat-zone military duty, or a certified shortage of agencies in your district.

A prior case can shut the door. Section 727(a)(8) bars a discharge if you received one in a case commenced within the previous eight years — filing date to filing date. Separately, § 109(g) bars filing at all for 180 days if you dismissed your last case yourself after a creditor moved for relief from the automatic stay.

The means test is not an eligibility rule. It is an abuse screen: § 707(b)(1) lets a court dismiss a case filed by someone whose debts are primarily consumer debts if granting relief would be an abuse. It does not govern Chapter 13, where eligibility turns on § 109(e) debt limits and regular income.

It starts with the median-income comparison. If your annualized current monthly income is at or below the New York median family income for your household size, no party in interest may bring a means-test motion (§§ 707(b)(6), (b)(7)). For cases filed on or after April 1, 2026:

• 1 earner — $73,272
• 2 people — $92,902
• 3 people — $115,579
• 4 people — $139,040
• Each additional person — add $11,100

Confirm the current table; it is revised roughly yearly. Above median, you run § 707(b)(2)(A)(i): current monthly income less allowed deductions, multiplied by 60. Abuse is presumed if that figure is not less than the lesser of $17,150, or the greater of $10,275 and 25 percent of your non-priority unsecured claims. Those amounts hold until April 1, 2028.

You file a petition plus schedules listing income, expenses, assets, debts, creditors and exempt property.

For a homeowner, the exemption line matters most. New York's homestead exemption, CPLR § 5206, protects the value of a principal residence above liens and encumbrances. In Nassau, Suffolk, Queens, Kings, Bronx and New York counties it is currently $204,825, effective April 1, 2024 and next adjusted April 1, 2027. If equity above the mortgage exceeds what you can exempt, a Chapter 7 trustee has a reason to sell the house.

The fee is $338 — $245 filing, $78 administrative, $15 trustee surcharge. Bankruptcy Rule 1006(b) allows up to four installments, all paid within 120 days of filing. A full waiver exists in Chapter 7 only (Official Form 103B), where income is under 150 percent of the poverty line and you cannot pay in installments. While on installments, Rule 1006(b) forbids further payment to your attorney until the fee is paid in full.

New York is divided into four federal bankruptcy districts, each with its own local rules.

Homeowners in Nassau, Suffolk, Queens and Brooklyn file in the Eastern District of New York — the court that publishes the fee schedule and median-income table cited above. Manhattan and the Bronx sit in the Southern District of New York. [CONFIRM: the correct courthouse and division for your county]

Filing triggers the automatic stay under § 362(a) instantly, with no court order. It stops acts to enforce a lien against property of the estate, including a scheduled auction. A trustee is appointed, reviews your schedules, and you appear at the meeting of creditors to answer questions under oath. Discharge issues roughly 60 to 90 days after the date first set for that meeting, so a Chapter 7 commonly runs about three to four months.

The stay does not outlive the case: under § 362(c)(2) it lasts only until case closing, dismissal, or discharge. A lender can end it sooner under § 362(d)(1), for cause including lack of adequate protection.

If you have filed before, the stay shrinks. One prior case dismissed within the past year and it terminates on the 30th day (§ 362(c)(3)); two or more, and it never takes effect at all (§ 362(c)(4)). In the Eastern District, In re Bender held that the 30-day termination reaches the collateral itself and ends the stay as to proceedings begun before the filing. A pending New York foreclosure action is exactly that.

A discharge does not extinguish a lien. The federal courts put it plainly: a discharge does not extinguish a lien on property, and secured creditors may retain rights to seize property securing a debt. Chapter 7 erases your personal liability on the note. The mortgage rides through untouched and the lender can still foreclose.

There is no cure mechanism. Nothing in Chapter 7 forces a lender to accept arrears over time. That tool sits in Chapter 13: § 1322(b)(5) lets a plan cure a default within a reasonable time while you maintain the ongoing payments.

The auction is a hard line. Section 1322(c)(1) allows a default on a principal residence to be cured only until the residence is sold at a foreclosure sale. In In re Herisse (Bankr. S.D.N.Y., May 22, 2026) a homeowner filed after the auction but before the referee's deed issued. The petition did nothing: the sale had already extinguished the equity of redemption, so the property never entered the estate. The deadline is the auction — not the judgment, not the deed, not the eviction.

Chapter 7 can discharge credit cards, medical bills and other unsecured debt, and for some households that alone frees enough monthly room to keep paying the mortgage. If that is your situation, or if a Chapter 13 plan is the answer, speak with a bankruptcy attorney. This firm does not file bankruptcy petitions.

What gets missed is how much runway New York can give you outside bankruptcy court. It is a judicial foreclosure state: the lender must sue, and every step needs a court order. In a residential case on a home loan where the borrower lives in the property, CPLR § 3408 requires a settlement conference within sixty days after proof of service is filed with the county clerk. A missed answer deadline is not always the end: under CPLR 3408(m) a defendant who appears at that conference is presumed to have a reasonable excuse and may answer within thirty days, with no substantive defenses deemed waived.

That is the ground foreclosure defense is fought on. Depending on the numbers, the result may be a loan modification, a repayment plan for the arrears, a settlement of an underwater second lien, or a negotiated short sale. Outcomes vary with the lender, the county and the facts of the case.

If you would like someone to look at where your foreclosure stands, the consultation is free. Call 516-719-4144 or reach the Jericho office. General information, not legal advice.

Does filing Chapter 7 stop a foreclosure sale in New York?

Filing triggers the automatic stay under 11 U.S.C. § 362(a) immediately, which halts a scheduled auction. But it is a pause, not a cure. The stay ends at discharge, at dismissal, or when the lender wins relief, and Chapter 7 has no mechanism to spread your arrears over time. If the auction has already been held, filing accomplishes nothing — the sale extinguishes the equity of redemption.

How much does it cost to file Chapter 7 in New York?

The court filing fee is $338: a $245 case filing fee, a $78 administrative fee and a $15 trustee surcharge. The court may allow up to four installments, all paid within 120 days of filing. A full waiver exists in Chapter 7 only, where household income is under 150 percent of the poverty line and you cannot pay in installments. Attorney fees are separate.

Will I lose my house if I file Chapter 7 in New York?

It depends on your equity. New York's homestead exemption, CPLR § 5206, protects value above liens and encumbrances in a principal residence — currently $204,825 in Nassau, Suffolk, Queens, Kings, Bronx and New York counties. If equity above the mortgage exceeds what you can exempt, a Chapter 7 trustee has reason to sell. Separately, the mortgage lien survives the discharge either way.

Is Chapter 13 better than Chapter 7 if I am behind on my mortgage?

Only Chapter 13 can cure arrears. Section 1322(b)(5) lets a plan pay the delinquency over three to five years while you resume the regular payment. It generally cannot lower that regular payment, because § 1322(b)(2) bars modifying a claim secured only by your principal residence, subject to a narrow exception under § 1322(c)(2) for loans that mature within the plan term. Feasibility is arithmetic: $30,000 of arrears over 60 months adds roughly $500 a month on top of everything else.