When someone is at the end of their financial rope, filing for Chapter 7 bankruptcy may be their best option. In fact, most people who file for bankruptcy file for Chapter 7 bankruptcy because it’s fairly quick and easy, doesn’t require the debtor to make payments to their creditors over a period of time, and eliminates most, if not all , unsecured debts. .
A good place to start is a trip to a local bankruptcy attorney for a consultation. Most bankruptcy attorneys offer free consultations to potential clients so that the individual can, with the bankruptcy attorney’s experience, determine if filing for bankruptcy is right for your financial situation, which chapter to file, the time frame and cost involved, and the overall process. to declare bankruptcy. It is imperative that the debtor feels comfortable with the attorney as they will be working closely together throughout the process and the debtor will need to provide the attorney with a lot of personal financial information. For example, the debtor should review their income, total assets, and debts with their attorney before filing the bankruptcy petition with the court. The attorney will use the full extent of the law to protect as much of the debtor’s assets as possible through the use of bankruptcy exemption laws. If the debtor has any property that is not exempt, the trustee can sell it to distribute the proceeds to creditors. A word of warning, a debtor who intentionally tries not to claim assets, hide the sale of assets before filing for bankruptcy, or transfer property or assets to another person or family member may face serious problems from the bankruptcy court if this is done. discover. Fines and/or jail time can and will be imposed on the debtor for such actions. This is why it is extremely important to disclose everything to the bankruptcy attorney early on. They are on your side and will work in the best interest of their client as long as the client is honest and upfront about everything. If there are any issues that the bankruptcy attorney thinks may be a problem, they can be discussed with the debtor in advance and a new strategy can be worked out to avoid surprises.
The thing to keep in mind is that bankruptcy was designed to give good, hard-working people a fresh financial start, not to penalize them for hitting a rough patch down the road. When someone files for bankruptcy, it is very important to be completely honest with your bankruptcy attorney and the court in order to take advantage of the fresh start that bankruptcy offers. In this tough economy we’re all in, filing for bankruptcy is no longer frowned upon like it used to be. Filing for bankruptcy is not just for individuals, but many businesses are taking advantage of all that bankruptcy has to offer. When it comes to bankruptcy, a little honesty goes a long way on the road to recovery.