Essential Things You Should Know About Filing for Bankruptcy
However simple it may be to get some loans from a bank or any other lender, the truth is that certain conditions may make you find it very hard to pay back the debt. 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. It is important to note that bankruptcy is a legal process and it involves the debtor and the lender in case of the debtor gas no capacity to pay back all the loans.
Firstly, you need to drive your attention to whatever happens in the courts before you get to know other things. The whole process of decision-making in court is made through a judge and an independent contractor who is hired for the case. 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.
Another important point for you to note is the fact that we have very many types of bankruptcy. Among the various types of bankruptcy is chapter 11, chapter 12 and chapter 13 whereas chapter 7 is the most common one. 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.
Bankruptcy filing is both a long and expensive task. Remember you will have to meet the credit counselor for bankruptcy and debt as well as putting all the relevant information in place 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 The tips above should give you a clue about what to expect when filing for bankruptcy.