I want to file bankruptcy. But how do I start? You can start by learning about bankruptcy, the types of bankruptcy and the ways to file bankruptcy. Basically, bankruptcy is a privilege that people can use to give them a chance to get a fresh start in their financial lives. We all know we need credit, businesses need credit to branch out and grow, and people need credit for some specific needs in their lives. what if something goes wrong and we find ourselves being slaves to debt. Without bankruptcy, imagine what would happen to a person if some unfortunate events happen in his life like job loss, divorce, costly illness that would ultimately put him in debt for the rest of his life and still being unable to pay all his debts. That would be a disastrous event to happen to anyone that is why we have bankruptcy so that creditors and lenders will not make a slave out of us.
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Know what bankruptcy is, why and how it works and for what. You will need to know the types of bankruptcy that one can file in court. There are four types of bankruptcy but only two are commonly used and applicable to the average person. These two types of bankruptcy are chapter 7 and chapter 13.
I want to file bankruptcy but which type should I file? Well, prior to the 2005 Bankruptcy Abuse Prevention and Consumer Protection also known as BAPCPA, almost anyone can file a chapter 7 type of bankruptcy which is the most popular bankruptcy. This is because chapter 7 allows a person to get rid of all his debts in exchange for the person's properties to be liquidated. But the new changes in the bankruptcy law have made it difficult for just any person to file for a chapter 7 type of bankruptcy. These new laws directly or indirectly encourage people to file chapter 13 type of bankruptcy instead.
Chapter 13 is referred to as a reorganization or repayment plan which a debtor will present in a creditors meeting. The new bankruptcy law made requirements that lead people to file a chapter 13 type of bankruptcy. It is required for any individual who wishes to file bankruptcy to go to a credit counseling agency. These agencies provide services like credit counseling sessions which the new bankruptcy law requires you also to provide a documentation of attendance. This credit counseling agency will provide you a repayment plan which you will then propose to your creditors. The only time creditors will agree to any proposal is only when you have pasted the income testing known as the means test. This test will provide the information that you have a steady income for a period of time that will still leave an amount significant and sufficient enough to cover your debts for the time period agreed by both parties after it is deducted from all your expenses.
The next thing you could do after deciding which type of bankruptcy you intend to file is to know how you want to file your bankruptcy. There are many ways you can file bankruptcy, you could either do it the easy way which is hiring a full time bankruptcy lawyer to do everything for you, if you can afford it or you can do everything by yourself which is a lot cheaper, all you need to do is to hire a bankruptcy petition preparer or bankruptcy lawyer to prepare all your documents and you file it in court. This way it is more affordable and you can save more time and money. For more information on how to file bankruptcy, visit the website below.
Is Bankruptcy Right For You? Talk to Bankruptcy Attorneys Free and Confidential. Licensed bankruptcy attorneys are available. Attorneys will call you to discuss your case for free. Find out if bankruptcy is right for your situation.
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