A Simple Guide About What Happens When You File for Bankruptcy
Although in most cases getting some loan is an easy task once you meet all the requirements, paying back the debt may be a big problem to some. One area of concern once you realize you are bot able to settle all the debts is the next step that is best for you. Even though bankruptcy is never a nice topic for most business and people, it is already with us and the best we can do is to enlighten you on the right step to take should you be a victim. Through the article herein, you will learn more about what happens when you file for bankruptcy.
Firstly, you need to drive your attention to whatever happens in the courts before you get to know other things. The whole process of decision-making in court is made through a judge and an independent contractor who is hired for the case. The decision on whether you are eligible for bankruptcy is made after both the judge and the trustee have reviewed information to declare you bankrupt or not.
You will also get to learn that there are very many types of bankruptcy and you can view here to know more about it. Some of the bankruptcy types are chapter 11, chapter 12 and chapter 13 whereas chapter 7 is the most common. You also ought to know that chapter 12 is in most cases occupation-based occupation-based. You will also get to know that most of the debts in chapter 7 are forgiven and it also entails the risk of having to sell some of your assets to clear part of the debts.
As a debtor, it is important to know that this process is very long as well as expensive. You should always seek to meet the credit counselor for bankruptcy and debt and at the same time assemble all the information that may be necessary for you. Be prompt to show the court that you made efforts in ensuring that everything is settled.
Your financial situation is the next greatest tool for the court before a decision is made. The whole process of having a look at your financial statements is normally done by the court trustee, the lawyer, and the creditor. It is, however, important to note that this process is not a one-day event and could take as long as several months before any approvals are made. Above are the important things to know when filing for bankruptcy.
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