How To Declare Bankruptcy

If you have exhausted all of your other options left for you but to file for bankruptcy within the United States, it is not always a straightforward process. Your main goal will be to try and make the process as hassle-free as possible. 

Types of Bankruptcy

There are actually two types of bankruptcy to choose from called Chapter 7 and Chapter 13. Chapter 7 bankruptcy is usually the one that is most commonly filed. It involves complete liquidation of all assets. Chapter 13 bankruptcy is not as straightforward as Chapter 7 bankruptcy. Filing for Chapter 13 involves setting up a payment plan as the person filing would actually like to pay off the debt and is requesting at least three to five years to do so. 

Consult A Lawyer

The next step in filing for bankruptcy would be to retain an attorney that has experience in bankruptcy cases. Do this by searching the Internet, using the telephone directory, or even asking a friend. It is so important to find a bankruptcy attorney that is not only skilled but also one that is professional. The person hired will be representing you as you deal with your creditors. During the initial consultation with your bankruptcy lawyer, think of questions that you would like to ask the lawyer before the process begins. It is important to have a clear understanding of what filing for bankruptcy entails as this will adversely affect your credit rating.

Consider The Costs

You should also consider the costs associated with filing bankruptcy. The main costs are for filing the application and paying the lawyer. Lawyer fees will differ either based on a flat rate or as a percentage of the debt owed. These costs will have to be paid before filing can begin. This is something to be aware of, especially when you already have financial difficulties. In Chapter 13 filing, the attorney may opt to receive his or her fee as part of the payment plan.

Notify Creditors

Notification of your creditors should happen after you have filed for bankruptcy. Your lawyer will be able to file the bankruptcy petition. Afterwards any queries for money owed should be referred to your attorney. About 30 days later, your legal representative will also arrange the “341 meeting” for you to be questioned by your creditors about the true amount of your assets. Sixty days after this meeting a notice of discharge is issued if all your assets have been declared.

Getting Legal Help Is Recommended

The information provided above is only to be used as a guideline for filing for bankruptcy. Instead it is recommended you seek advice from a professional experienced attorney about your specific situation.