Things You Need to Know When Filing for Bankruptcy

Filing for bankruptcy is often seen as a scary proposition. As an individual or a business owner, you might never have imagined things taking that route but life is never short of surprises. The focus should be on getting back on your feet. It is important that you’re familiar with the process of filing for bankruptcy even if you’ll be working with an experienced attorney. Having a deeper understanding is crucial so that you’re aware of the steps to take.

There Are Two Main Options

When filing for bankruptcy, you’ll be faced with two main options. You will have to consult with the attorney in order to determine the one that is best for you.

Chapter 7 bankruptcy: Also referred to as liquidation bankruptcy, this option will mostly discharge all your unsecured debts. Such debt will include credit cards and personal loans.

Chapter 13 bankruptcy: With this type of bankruptcy, you’re required to come up with a repayment plan so that the creditors are paid over a period of time. There will generally be no liquidation of the property with this process but it could take up to five years before everything is finalized.

Bankruptcy Will Open You Up to Financial Scrutiny

If you’ve never gone through a bankruptcy case before, one might assume that it is a normal process and the court system is the same. It should be noted that such cases could last for longer than 90 days and entail complicated legal matters. That is why it is important to have a bankruptcy attorney by your side for the best possible outcome of the case. When you file for bankruptcy, it will be mandatory that you attend the meeting of creditors. During such a meeting, you will be asked many of questions in a public setting and under oath. There are no restrictions on the questions and any creditor that is present is allowed to probe. You should expect your finances to be scrutinized.

Complete Disclosure Is Required

It is crucial that you’re completely honest and transparent when filing for bankruptcy. Leaving out important details could be detrimental to your case. You’ll be required to provide a list of all your properties, creditors, and debt. When dishonesty is discovered, you could be looking at losing your discharge, or worse.

Having looked at some of the most important elements when declaring bankruptcy, you might be wondering what is required in order to begin the process. There are some key steps that you should take and we’re going to highlight some of them.

Find an Attorney

This will be the first thing you’ll need to do if you’ve decided to file for bankruptcy. There is a lot of information on the internet about finding the right lawyer. Ideally, you should be looking for someone that is experienced with bankruptcy law and has handled a case similar to yours in the past. To get the right attorney, you can ask for references from your family lawyer or accountant that you’ve worked with.

Credit Counseling

It is a requirement by the Federal Bankruptcy Code that individuals get credit within 180 days before declaring bankruptcy. For married couples, both individuals will be required to attend credit counseling sessions. You’re not supposed to go to just any other counselor. There is a list of approved counselors by the U.S. Department of Justice.

Complete The Paperwork

This is the most time-consuming part of the whole process of filing for bankruptcy. Your attorney will need to prepare a petition. In addition to that, you’ll be required to provide detailed documentation of your assets, income, living expenses, and tax returns.

Meeting With Trustee

The court will appoint a trustee for your case once you file for bankruptcy. The role of the trustee is to oversee the case up to its logical conclusion. The trustee’s work is to look for assets to liquidate to pay your creditors with.  However, most assets are protected with bankruptcy exemptions.  For the process to be smooth, it is imperative that you’re cooperative with the trustee. You must furnish them will all the financial documents that they request.

Additional Considerations

There could be additional requirements for a married couple. You have the option of filing for bankruptcy together or separately. If you’re on good terms, it is recommended that you’re filing together to avoid filing fees. It might seem like a good idea for one spouse to file for bankruptcy so that their credit score isn’t being affected. It will be imperative to speak with an experienced bankruptcy attorney to determine if it makes sense to file bankruptcy together.

Conclusion

The process of filing for bankruptcy is complex and time-consuming. Once you’ve decided it is the best option for your situation, you’ll need to familiarize yourself with the process. There are potential pitfalls that can easily be avoided with the right information. It is also important that you’re working with an experienced attorney for your case. Take your time to do research. Look at all the available options before making any important decisions.

Butcher Law Office, LLC.

Butcher Law Office, LLC was founded on the premise of offering personal and one-on-one bankruptcy services for clients. You get to work with Tom Butcher who is an attorney with more than 12 years of experience and more than 1300 bankruptcy cases filed.

Find top rated attorneys and law firms profiles with Find Attorneys Directory, the best and free online attorney directory. Guest bloggers can also publish their articles here as other bloggers are doing.

You must know the advantages and disadvantages of bankruptcy before filing bankruptcy

Bankruptcy is a financial condition that a person and organization can declare when they cannot repay their creditors or lenders. Not as simple as it sounds. If announced bankruptcy, it badly affects your credit score, and you cannot get any credit from banks or any financial institution. A lawsuit is filed in court when a person declares bankruptcy. Then there is a legal process where all the entity’s outstanding obligations from the company’s assets are assessed and paid (in whole or part).

As we know, that declaring bankruptcy will affect your future earnings, credibility, and self-image. If a person filing for bankruptcy usually finds it difficult to restore their reputation and stable debts, it can be challenging to adapt to a scaled-down lifestyle. Nevertheless, Tucson Bankruptcy Lawyer often provides considerable relief to those trapped by dangerous debt levels. When bankruptcy is declared, the threatening phone and letters requesting payment will cease.

Tucson Bankruptcy Lawyer will help you evaluate the advantages and drawbacks of declaring bankruptcy so that you can make a choice. You must know the advantages and disadvantages of bankruptcy before filing bankruptcy is given below.

Before filing bankruptcy, you should know it depends on the situation you have; this blog will help you to address the pros and cons of filing bankruptcy to determine that bankruptcy is the right solution for you.

Disadvantages of filing for bankruptcy

As you know that bankruptcy filing can affect your financial status and social image for many years, you should consider all your options carefully before filing. Such drawbacks are:

Your real estate and personal property can confiscate. If you cannot exclude all of your personal property or real estate property from the bankruptcy exemption, the bankruptcy court may seize some of your assets and sell to pay your creditors.

Unable to use the credit card- mostly credit card companies cancel your credit card when you file bankruptcy. After filing, you will likely receive several offers to apply for an “unsecured” credit card. That will help you restore your reputation but usually includes higher interest rates and annual fees.

Getting a loan or credit will be challenging – after filing for bankruptcy, you will not get a loan for your new house, study, and job.

Refusal of a tax refund- Due to bankruptcy, state, local and federal tax refunds can be dismissed.

Non-Refundable debts- Some forms of debt may not discharge bankruptcy. Commonly non-negotiable loans include alimony and child support, student loans, criminal reinstatement, fines, and any loans obtained by fraud.

Bankruptcy holds a strong stigma and personal bankruptcy more. However, to avoid embarrassment, it is necessary to enable oneself to take advantage of bankruptcy (see below)

Advantages of filing for bankruptcy

Issue stay against creditors – The court will immediately approve this stay against any debt collection practices after you file bankruptcy. It does not eliminate your mortgage and liability, but it suspends all debt recovery proceedings until the bankruptcy case completes or the moratorium is lifted.

Discharge your debts- You will be entitled to discharge or cancel the obligation to repay those debts. It is a debt that can be liquidated by bankruptcy. These usually include credit cards, medical and utility bills, and personal loans.

Credit Score- While filing for bankruptcy leads to multiple delays in credit ratings, and bankruptcy filings remain on record for 7-10 years, Tucson Bankruptcy Attorney eventually boosts your credit scores after filing for bankruptcy.

There is no need to worry about property seize – An exemption from bankruptcy may allow you to maintain over your assets after filing bankruptcy. If you file for bankruptcy, it means that you don’t have to worry about property seized in bankruptcy. These provisions play a significant role in both Chapter 7 and 13 bankruptcies.

No more financial burden- You can learn to live within your income without a credit card and avoid potential financial catastrophe.

Conclusion: A Tucson Bankruptcy Lawyer will help you decide whether to file for bankruptcy and what type of bankruptcy you should file according to your financial condition. When you plan to file, a Tucson Bankruptcy Attorney will help ensure that your assets/property are protected. All of your debts, financial obligations that can discharge and your creditors do not violate your rights so that you are on the right path to financial recovery when you do your bankruptcy to complete.

Note: Deciding to file bankruptcy is a challenging process for you because you do not know when and how to file. Therefore, you must consult with a competent Tucson bankruptcy Lawyer to decide whether bankruptcy is the best option for you.

Find top rated attorneys and law firms profiles with Find Attorneys Directory, the best and free online attorney directory. Guest bloggers can also publish their articles here as other bloggers are doing.

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Find top rated attorneys and law firms profiles with Find Attorneys Directory, the best and free online attorney directory. Guest bloggers can also publish their articles here as other bloggers are doing.