Personal Bankruptcy
Personal bankruptcy. It’s not a pleasant thought, but sometimes it’s the best choice and the first step into regaining control of your financial future. You’re going to want to read all the information you can find about personal bankruptcy because the more informed you are, the more comfortable you’ll feel. Remember that knowledge is power and once you understand your options, you’ll be that much closer to getting your finances in line.
What’s the first step, you ask? Talking to a good bankruptcy lawyer will help you determine if filing chapter seven or thirteen is right for you. Chapter seven is usually the most attractive choice for those looking into personal bankruptcy for a few reasons. Number one being that when it’s all said and done, most people will walk away with a clean slate and a chance for a fresh start. Another reason people are drawn toward chapter seven is because you usually don’t lose any of the assets or property you’ve worked so hard to acquire. This means your home, your car and your personal belongings stay with you thanks to federal and state laws that provide exemptions for your property.
Though chapter seven does clear most debt, not everything is dischargeable. Even if you file for personal bankruptcy, you still might be obligated to repay certain types of debt. Some state and federal taxes, student loans (unless at least seven years old) and debts accrued by fraud will most likely stay with you even when it’s all said and done.
Moving on to chapter thirteen – the red headed stepchild of personal bankruptcy- but still the better option for some. Who files chapter thirteen? Those with too much income to file chapter seven and those that have non-dischargeable debt and nonexempt property that they don’t want to lose. You might also consider chapter thirteen if you’re very behind on your mortgage or business payments and are trying to fight off foreclosure. With chapter thirteen, your debt won’t be erased, but you will get the chance to repay it in a predetermined amount of time.
Your creditors will not be able to take any further action against you once you’ve filed for either chapter thirteen or chapter seven. That means no more harassing phone calls or threatening letters demanding you pay the debt you owe immediately. Even if one of your creditors has gone as far as taking you to court over your debt, filing for personal bankruptcy will usually stop the lawsuit right in its tracks. Though it doesn’t always happen this way, most people find that when their bankruptcy is over, past creditors stay away and don’t often reappear looking for their money!
Filing for personal bankruptcy is not complicated if you educate yourself on the ins and outs of the entire process. Along with your reading up on bankruptcy, you’ll most likely want to hire a lawyer that can help guide you through it step by step. Though you might feel confident you know everything there is to know about personal bankruptcy, having an expert to turn to will ensure everything goes smoothly.
The following links can help you make a decision on personal bankruptcy:
Personal Bankruptcy Exemptions
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