Bankruptcy is the most common solution used by those businesses and individuals who can’t meet their debt obligations. There are different reasons why you may have to face the same trouble. For example, if you have urgent expenses, such as medical bills, you risk ending up with the necessity to file for bankruptcy.
It is advisable to consider all ins and outs involved in advance, so click here for more info. Contact reliable and experienced lawyers who will provide you with detailed guidelines. Bankruptcy is an effective strategy to get rid of your debt obligations, but do not forget about its long lasting effects, such as your ruined credit score. You will have to improve it over time.
This process is quite complex and it involves certain fees. That’s why you should not handle it on your own.
- Possible consequences. The basic purpose of bankruptcy is to help people eliminate their unpaid debts and get a fresh financial start. It may remain in your credit report for several years, so be prepared for that. This means that you won’t be able to get approved for certain loans.
- The debts that must be paid. When filing your bankruptcy petition, keep in mind that there are certain debts that you will still have to pay back. This can be said for child support, alimony, taxes, student loans, and so on. The worst thing is that your co-signers are not protected, so that they are legally obliged to pay off at least a part of your debts according to existing laws.
- The filing process itself. The first step that should be taken is attending special credit counseling courses. It is necessary to get a special certificate and attach it to your paperwork. You need to have a good lawyer at your side to handle important legal matters as well.
- The right type of bankruptcy. There are different options to choose from, but Chapter 7 and Chapter 13 are chosen by most borrowers these days. You should learn more about each one to determine the best one for your needs.
For example, Chapter 7 bankruptcy is designed for those individuals who do not have a regular income. Their non-exempt assets will be liquidated to meet their debt obligations. Chapter 13 is associated with a repayment plan, so that you will have to make regular payments for a few years. It involves better interest rates, terms and conditions. You will save your property.