Are your bills and credit card debts backing up? Are you getting harassed by bill collectors? Don’t panic, you are not the only one! People are filing for bankruptcy in record numbers due to the current economic downturn in the USA.
If you find yourself in this position, it may be best to consult a bankruptcy lawyer. A Bankruptcy lawyer will show you how easy it is to file bankruptcy and help ease your financial troubles and give you a fresh new start!
Many people often wonder what filing for bankruptcy actually means and often share common misconceptions about what will happen when filing. Bankruptcy is a legal process that allows individuals or businesses to repay their creditors all or a portion of their debt or have their debts wiped clean.
There are 2 types of bankruptcy that can be filed depending on the individuals income:
Chapter 7 Bankruptcy
Chapter 7 Bankruptcy is the most common form of bankruptcy. If an individual files under Chapter 7 Bankruptcy, he/she can eliminate most or all unsecured debt (personal loans, credit card debt, etc).
Chapter 13 Bankruptcy
Chapter 13 Bankruptcy is different than Chapter 7 Bankruptcy. Chapter 13 Bankruptcy is what and individual would file for if he/she has a regular income. Since the individual has a regular income, he/she has the means to repay debts to creditors. Creditors will work out a time line and payment plan that will allow for payment of the debt over time. Chapter 13 Bankruptcy is often what is filed with homeowners wanting to avoid foreclosure.
As mentioned above, many people share common misconceptions about filing for bankruptcy. People think that filing for bankruptcy will destroy their credit for life. This is not true. If you are filing for bankruptcy, chances are that your credit is not all that good. It will take a while to re-establish your credit over time, but having debt and bill free freedom gives you the extra money to help re-build your credit.
People also worry that filing for bankruptcy will put their employment in jeopardy. The bankruptcy code prohibits employers from discriminating against employees who file for bankruptcy. If you suspect that you have been subject to discrimination after filing bankruptcy, contact the Equal Opportunity Commission
Also, remember that certain property is exempt from bankruptcy filings. You will not loose everything you own. In most cases, individuals are able to keep most of their property and personal belongings. Filing for bankruptcy can be one of the hardest things to do and is full of complex rules and regulations. If you are considering filing for bankruptcy, your best bet may be to hire a bankruptcy attorney.