Guide To Filing For Personal Bankruptcy

By Sharon Howard


When you have too much debt that you are not able to service accordingly, you should not hesitate to seek legal protections. This is because creditors and debt collectors will harass you until they get all their money back. By filing for personal bankruptcy, you will be able to get legal protections. For instance, creditors and their agents, will be stopped from getting in touch with you or trying to recover their debts in any way.

When you have a hard time servicing your debts, you should not think about becoming bankrupt as an option of first resort. You should at least try to consolidate your debts and refinance. If this fails, you can approach a qualified lawyer for advice and guidance. That said, you should only become bankrupt if you do not have any other viable option for getting rid of your debts.

It is crucial you take your time to search the internet for the best lawyer to advise you during the case. This is because there are serious consequences that come with becoming bankrupt. Therefore, you should look for the most reputable lawyer who charges the most competitive rates for their services. Be sure to compare quotes for legal services before making a decision.

This type of bankruptcy is normally referred to as the chapter 13, and is meant for individual debtors who have personal debts. To qualify, the applicant must have a lot of bad debt that they are not able to manage with their current income. This option can also be considered as a form of debt restructuring for a limited amount of time. After this period lapses, any unpaid debts will be written off.

Anyone who has a lot of debt, some assets and lacks a reliable income can be declared bankrupt under chapter 7, which entails liquidation of non-exempt property to recover funds to settle their debts. This option is not always recommended because you will lose your property. It is also much more public than other chapters, so chapter 13 should always be given priority consideration.

In a chapter 13, debts are usually written off after the debtor has made regular payments over a period of several years. The payments are usually affordable and convenient. They are often paid to the trustee, who distributes the amounts to creditors. After a number of years, the payments are stopped and any unpaid debts are written off. As a result, no assets are liquidated to pay creditors.

There are many benefits of using this chapter to settle your debts. One of the main ones, however, is the ability to settle all your debts by paying only a small amount of money regularly. After a few years, any unpaid debt will be written off.

It is important for every debtor to know that bankruptcy will not resolve all their debt problems. This is because there are certain debts that cannot be subjected to chapter 13 proceedings. This includes student loans and child support payments. The latter can only be changed by a family court while student loans must be paid no matter what.




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