A Simple Guide About What Happens When You File for Bankruptcy
Although in most cases getting some loan is an easy task once you meet all the requirements, paying back the debt may be a big problem to some. One area of concern once you realize you are bot able to settle all the debts is the next step that is best for you. Although bankruptcy can be termed as a misfortune and nobody ever wishes to find themselves in such a situation, it is a reality that has already hit the world and the best option is to know what is important for should you find yourself here. Through the article herein, you will learn more about what happens when you file for bankruptcy.
One of the most basic thing that you need to know about is the process and whatever happens in court. The decision about bankruptcy is made in court and this is through a judge and an independent contractor who is hired for this service. The decision on whether you are eligible for bankruptcy is made after both the judge and the trustee have reviewed information to declare you bankrupt or not.
You will also get to learn that there are very many types of bankruptcy and you can view here to know more about it. Whereas chapter 7 is the most common type of bankruptcy, we also have others like chapter 11, chapter 12 and chapter 13. You should also know that chapter 12 is occupation-based occupation-based as explained on this page. You will also get to know that most of the debts in chapter 7 are forgiven and it also entails the risk of having to sell some of your assets to clear part of the debts.
You should always consider this task demanding when it comes to the time as well as expenses. One of the things that you must always be ready for is to meet the credit counselor for bankruptcy and debt and also assembling all the important information for the process. Always try to show the court that you have tried all that you could to settle the situation.
Normally, the court will come up with plans to have a look at your financial situation before any decisions are made. This is done by the court trustee, the lawyer and the creditor. You need to note that this process lasts for a long time and can take up to 6 months Above are the important things to know when filing for bankruptcy.