Mounting debt, foreclosure, repossession, and the inability to make monthly payments stop the harassing creditor telephone calls can become overwhelming. The good news is, bankruptcy can provide the relief an individual needs to gain financial freedom and still keep some of their assets. Filing bankruptcy is completely legal and can erase an individual’s debt. Depending on the type of bankruptcy an individual is eligible to file will determine whether they can keep their house, car and other assets while eliminating their debt.
Filing Without An Attorney
An individual can file bankruptcy on their own, but they should thoroughly research the process and the forms that must be submitted to the court. They will also need to determine if they’re filing Chapter 13 or Chapter 7 bankruptcy. Chapter 13 is more complicated and Chapter 7 is considered a simple bankruptcy.
Can Any Type Of Attorney File Bankruptcy?
Although any type of lawyer can file bankruptcy for an individual, it’s important to find someone that does it on a regular basis. They will be familiar with changes in the law, the guidelines, and how the process works. A general attorney will not have the knowledge a bankruptcy attorney does.
Chapter 7 Bankruptcy
This type of bankruptcy is considered simple because it’s great for individuals that have little or no assets and a lot of unsecured debt. Exemptions are given to a variety of items an individual owns, and a trustee will be appointed by the bankruptcy court to liquidate any assets that remain to pay the creditors. The bankruptcy will be discharged and a filer will be free from debt.
Chapter 13 Bankruptcy
In this type of bankruptcy, many assets can be retained by the filer and their debt will be restructured. An individual will be set up on a three to five-year payment plan through the bankruptcy court. At the end of the payments, the balance of the debt will be eliminated. An individual must have a regular source of income to make the payments.
There are certain debts that you will not be able to include in a bankruptcy proceeding like child support, certain taxes, student loans, and spousal support. If you’re swimming in debt, bankruptcy is certainly worth considering.