Millions of Americans are currently trapped under mounds of debt. People are stressing out on everything from student loan debt to credit card debt. Unfortunately, many of these people simply don’t have the finances to pay back their creditors in their lifetime. These individuals may benefit from bankruptcy. Bankruptcy can be your shot at a fresh financial start. The following are a few steps you should be prepared for in case you decide to make this financial move.
Any consumer who wants to declare bankruptcy will first need to file a petition with the Federal Bankruptcy Court. These filings will detail practically everything about your current financial situation. Filers are expected to provide detailed information pertaining to their assets, the amount of debt they owe and all of their creditors. Once this petition is accepted your creditors will be required to cease all attempts to collect from you. Since these filings can get complicated you should consider speaking with one of the Consumer Bankruptcy Lawyers in your area.
Speaking with a lawyer can also help you decide whether or not bankruptcy is the right choice for you. Contrary to what some may believe, bankruptcy isn’t able to erase all debt. Bankruptcy is only able to eliminate unsecured debt. Unsecured debt is any kind of debt that doesn’t require you to provide collateral upon receipt of a loan (i.e. credit cards, hospital bills, student loans, etc.). On the other hand, secured debt cannot be erased by bankruptcy (i.e. car loans, mortgage, etc.).
There are two main types of bankruptcy that are used: Chapter 7 and Chapter 13 bankruptcy. Chapter 7 bankruptcy will require you to liquidate non-exempt portions of your property in order to pay back your creditors. Chapter 13 bankruptcy simply protects you from creditors so that you can reorganize your debt and repay what you owe. Talk with the Consumer Bankruptcy Lawyers in your area for advice on which option is best for you.
Think about all of this information before you decide to file for bankruptcy. Again, when you file your petition you’ll be required to provide all of your financial information. Consider consulting with a lawyer to determine if your debt is even eligible to be eliminated. Lastly, carefully consider which type of bankruptcy is best for you and your situation. Visit Us for more details.
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