Declaring Bankruptcy
Declaring bankruptcy is not something that anyone wants to do,
however, sometimes you just don’t have any other choice.
Sometimes you have gotten into debt – whether by your own fault
or not – and you have no way of paying it back. You may have
lost your job, you may have had a medical emergency, there
really is no recipe for what gets people into these messes.
Fortunately there is bankruptcy to get you out of it.
For those people who have tried to pay back their debt and are
unsuccessful, they can turn to the courts to get them some
relief. First you will need to contact a bankruptcy attorney.
This is of course after you have tried everything else – debt
consolidation, settlement, etc. Once you have exhausted all
other means, you will take a bankruptcy test. This will
determine if you should file Chapter 7 or if you only qualify
for 13. Chapter 7 eliminates all of your debt, while Chapter 13
restructures it so that you pay back part of it.
You can do bankruptcy on your own without an attorney but it is
not recommended as they have the knowledge that you usually need
to file this sort of legal paperwork. Once you have hired your
attorney you need to send all of your creditors to them as they
are no longer allowed to contact you regarding your debts. There
will be a meeting of your creditors and the trustee assigned to
your case will determine if there are any assets that can be
sold off to pay them back. Once that part is done you have 60
days wherein the creditor can challenge the bankruptcy. If they
don’t then your debts are discharged and you are debt free.
However, the bankruptcy will seriously hurt your credit and stay
on it for seven to ten years. That is why all other options like
debt consolidation should be exercised first.
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