We all know times are tough and, for a number of us, bills are getting harder to pay monthly. If the debts you owe are more than what you can afford, you should read on.
Filing a bankruptcy can be the answer to your problems. A bankruptcy is a way to discharge your debts completely so that you can have a fresh start in your financial and personal life. You can only file a bankruptcy once every 6 years and once filed, it can become part of your credit history
Before filing, you want to know two things: 1) that your monthly expenses (i.e. rent, phone, medical payments and just about anything else paid by you for the living expenses of you and your family) are more than your monthly earnings and 2) that your assets (all property you own in its current market value) are worth less than your liabilities (that is, the debts you owe and you will list on your bankruptcy petition).
The next step in filing a bankruptcy is to get the actual petition ready. The request is a comprehensive document listing all your income, assets and liabilities in addition to other information with regard to your financial history. You have to list all the creditors that you owe money to and need to be discharged from that debt. Any creditor that you don’t record will always remain your own lender. By way of example, you might choose to keep one of your credit cards should you not record that credit card company in your request then you may continue to use that line of credit (of course, you may continue to make your monthly payments for this credit card).
Your request will be filed in the bankruptcy court for about a $150.00 fee. The moment your petition is filed an automatic stay is in place that means your creditors listed in the petition should stop their collection procedures during your bankruptcy proceedings.
Only those creditors you list in the request will be notified with regard to your filing for bankruptcy. In about 30 days from your filing date, you’ll be scheduled for a first meeting of creditors (called a section 341 meeting). At that meeting, the bankruptcy trustee (the person from the courtroom ) will ask you some questions. The trustee is interested in discovering whether you have any property or assets available for the benefit of your creditors. By law, you’re permitted to keep certain property and the trustee’s questions are very simple and not at all intimidating. After the trustee is completed, your creditors are given a chance to speak. If none of your creditors appear then an additional 60 days is set for everyone to make any objections or file any additional papers. If nothing happens in that 60 day period, your bankruptcy will be allowed and you’ll be relieved from all debts listed in your request.
This guide is certainly not all inclusive and is intended only as a brief explanation of the legal issue presented. Not all cases are alike and it is strongly suggested that you consult a lawyer if you have any queries regarding any legal issues.