Tips for The Average Joe
A Simple Guide About What Happens When You File for Bankruptcy
Whereas the process of applying for some loan can be as simple as meeting the qualifications, situations may arise when you are not able to pay the loans back. The most commonly asked question by most debtors who have a hard time settling the debts is what next for them. Even though bankruptcy is never a nice topic for most business and people, it is already with us and the best we can do is to enlighten you on the right step to take should you be a victim. One of the key things that you need to note is that bankruptcy is a legal process meaning that everything is decided in court and it involves both the lender and the debtor.
Firstly, you need to drive your attention to whatever happens in the courts before you get to know other things. 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 two parties will take their time and have a review and finally make a decision whether you are eligible for bankruptcy or not.
Another important point for you to note is the fact that we have very many types of bankruptcy. 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. Although chapter 7 bankruptcy may forgive most of the debts, you may have to sell some of the important bassets that you own to pay the debt.
As a debtor, it is important to know that this process is very long as well as expensive. You should always seek to meet the credit counselor for bankruptcy and debt and at the same time assemble all the information that may be necessary for you. Be prompt to show the court that you made efforts in ensuring that everything is settled.
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 With the tips above, you will know all things that are important to you before you file for bankruptcy.