All About Bankruptcy – The Bankruptcy Process
Filing bankruptcy is the last step for an individual if there is no other way to come out of the financial crisis leading to loan repayment issues. But before going ahead with filing bankruptcy one should take advice or consult the concerned authority and understand personal bankruptcy related information so that there is no chance of being misled by anyone. Bankruptcy filing is a complex process and hence, gathering personal bankruptcy information and getting to understand the nuances of the bankruptcy filing process so that a concrete decision regarding whether one should actually go ahead with the bankruptcy or chose some other repayment option which is feasible and affordable.
A bankruptcy is filed to either free you of all debt or allow you to repay the bills across a period of time so that you can rid yourself of debt by paying back the amount. However, since a bankrupt individual is financially not capable, it needs to be determined whether he will file chapter 7 bankruptcy petition and forgo all his debts by liquidation of his assets or he will avoid foreclosure by opting for chapter 13 bankruptcy payment plan. Chapter 13 bankruptcy foreclosures will enable an individual to pay off his debt with a new payment plan across a span of time. Filing chapter 7 bankruptcy petitions is only agreed when the bankrupt individual doesn’t have enough money to pay off his creditors and the trustee files a chapter 7 bankruptcy petition on his client behalf in order to liquidate all his assets and pay off the creditors.
But before anything a bankruptcy counselor should be consulted who will guide an individual facing financial crisis as to whether he/she should opt for bankruptcy or take another route to freeing himself of debt. Either a local trustee or a bankruptcy counselor should be the first step in the bankruptcy process so that an accurate evaluation is done of your financial situation and your repayment options. The bankruptcy counselor will make sure that you understand all the legal and financial aspects of the bankruptcy process and what will be your duty after filing the bankruptcy. The trustee or counselor will provide enough personal bankruptcy related information which will help you understand the bankruptcy process and at the same time they want accurate information from you to decide whether you should file bankruptcy or go for other options like debt consolidation, debt settlement etc.
Once it has been decided the person will file personal bankruptcy then the court appointed trustee gathers all the necessary details, documents and asks the applicant to fill a bankruptcy form which will be necessary to prepare the legal bankruptcy documents and then process it. When the application has been processed then you will be asked to sign the document so that your bankruptcy process becomes official and you immediately receive court protection. If you have filed chapter 7 bankruptcy petitions then you will have to list out all the non-exempt assets which will be liquidated to pay off your creditors.
The next steps in the bankruptcy process is reviewing your cost of filing the personal bankruptcy and once that is decided and the bankruptcy filed on your behalf, you will be required to attend court credit counseling sessions aimed at reducing your spending habits and helping you manage your finances more efficiently. The last step to be carried out is to provide a monthly report to the trustee stating your daily expenses and monthly income.
Sam Johnson is a regular writer on Bankruptcyonly.com, a US based portal, which provides detailed information on Chapter 7 bankruptcy requirement petition, Chapter 13 Bankruptcy Help payment and other bankruptcy process related issues.
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