Filing For Bankruptcy: Only If You Really Have To
Filing for bankruptcy is not a pleasant and easy task but it can still be an efficient and quick process if one is thoroughly aware of how it is done. Filing for bankruptcy does not simply start by filling up the requisite forms. You should find someone who has the necessary legal expertise to help you from the time to acquire the forms up to the final discharge of the case. You should also gather all pertinent financial documents together in one organized pile; all papers related to your finances such as outstanding bills, bank statements, recent paycheck, and copies of real-estate mortgages, car loans and income tax statements.
Filing for bankruptcy means having a clear petition which should be an accurate list of all the debts you owe. This petition has to be thorough and honest in its inclusions not only would your petition be dismissed, you might also be found to be federally liable for any deliberate omissions or falsities. Know the difference between "secured" and "unsecured" debts; secured debts might include your house and car and that creditors have a security interest in these. Unsecured debts are debts such as credit cards, medical bills and unpaid alimony or child support payments.
In filing for bankruptcy, an important question to ask your lawyer would be on what debts will be retained or discharged. Remember that certain debts are legally hard to discharge than others such as taxes, student loans and child support; in some states, these may not be discharged at all. Be honest about any form of income that you may have earned, even those that may have been earned incidentally. Non-reporting of such details may be enough reason for the court to dismiss your case. Analyze your documents thoroughly; you may have to make a qualitative assessment (based on the types and amounts of your debts) on what chapter you should be filing under, whether it should be Chapter 7 or Chapter 13
In filing for bankruptcy, review everything three times if necessary even if everything seems to be in order. Go over the papers with your lawyer. After that is done, filing for bankruptcy can be accomplished online with appropriate bankruptcy court in your district. You can do this yourself as well and you can even mail the papers via mail. After this, your creditors will be duly informed of your petition; one positive outcome of this is that an automatic stay goes into legal effect, stopping all collection efforts by your creditors. If for some reason, it is taking quite a while for the court to inform your creditors, you can inform your creditors yourself by giving them your case number and the date on which you filed it. After filing for bankruptcy, the courts will also assign a Trustee to your case who will confirm the accuracy of your bankruptcy forms. If you have been honest with all possible information, a Trustee can declare you be a "no asset" case, which means you can keep all your assets and won't have to surrender anything to the Bankruptcy Court for liquidation as payment to your creditors. At this point, ask your legal consultant about appropriate exemptions applicable to your case. Exemptions are put on some assets that you would not have to surrender; exemptions vary per state. The last steps include attending a Meeting of Creditors after which, when everything seems to be in order, a final discharge is made.
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