Not a lot of people are familiar with the bankruptcy process, more so how to file bankruptcy forms. Bankruptcies allow individuals to repay their debts in a relatively less stressful manner. Bankruptcy filing starts when debtors file a petition in court. There are several types of bankruptcy. The circumstances, resources, and goals of the individual who decides to file bankruptcy are all taken into consideration. The most common bankruptcy cases are under either Chapter 7 or Chapter 13.

Bankruptcy Chapter 7 is also referred to as liquidation. The assigned trustee in bankruptcy cases under this chapter shall liquidate the assets of the debtor, thus the name. Your bankruptcy trustee will have all your non-exempt assets liquidated and all proceeds will be distributed to pay your creditors. Trustees also ensure that there is no interaction between the debtor and the creditor, especially to avoid any issues involving debt repayment. In the usual bankruptcy procedure, you could be asked to repay some of your unsecured debt, but most would be dischargeable.

Meanwhile, bankruptcy filings under Chapter 13 are also called reorganization. One advantage of filing for bankruptcy under this chapter is that you are not required to surrender any personal property to pay back your debts. Filers can avoid foreclosure because they are given a chance to pay off their debts through a payment plan (that runs from three to five years). Your monthly income is often the basis of your ability to repay your creditors. In this bankruptcy proceeding, you shall reorganize your debts and propose a repayment plan with your bankruptcy petition. You may negotiate for monthly payments or any schedule that will enable you to pay back what you owe.

Filing for BankruptcyUnder the relevant bankruptcy law, an automatic stay shall take effect immediately after filing. Unless lifted through a court order, this shall be in place throughout your bankruptcy filing and prevents any further collection activities from your creditors or even creditor harassment. However, there are certain things that you must do before filing your bankruptcy petition.

Take for example individuals who previously signed up for loans or credit cards to address financial problems. Banks or credit card companies may proceed with set-offs. This means funds in the bank account may be taken to pay off the loan debt or credit card debt. Make sure that you manage your accounts well to prevent set-offs before your bankruptcy case. This could be explained further by your bankruptcy attorney.

In bankruptcy filings, debtors are required to complete pre-filing and post-filing courses. Make sure to have completed a credit counseling course before you filed for bankruptcy since you should file the certificate of completion along with your bankruptcy petition. Similarly, you must complete a debtor education course and file it to the bankruptcy court before you can receive your bankruptcy discharge and wipe out your debts.

You’ll need to pay the appropriate fees after filing your petition to the court. If you’re unable to pay the filing fees, talk to your bankruptcy attorney about the possibility of submitting a waiver.

As soon as you consider filing, get a trusted bankruptcy attorney. Bankruptcy law must be taken very seriously. You may be sued for keeping secret vital bankruptcy information. Not only will bankruptcy cases with erroneous or false information be dismissed; you may even face fines or other penalties. As such, you must be careful not to miss out on the details when you file for bankruptcy. After all, your goal is to have your bankruptcy discharged, not dismissed. 

Bankruptcy lawyers will explain to their clients how to file following the bankruptcy laws. Bankruptcy proceedings are complex and complicated. By getting the right bankruptcy lawyer, an individual could make the most out of his or her debt-relief efforts through a bankruptcy filing. When done right, it will allow you to wipe out your debts and have a fresh start with your finances. Contact us at Northwest Debt Relief Law Firm for legal help and assistance.

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