Bankruptcy questions and answers may be found online. Sites on the Internet provide frequently asked questions with answers on common questions concerning bankruptcy. Some sites offer free evaluations based upon one's unique circumstances. Using the Internet to obtain advice might include a discount toward services through some sites. Understanding one's rights when considering bankruptcy is important. Pray about the situation. There are alternatives other than filing. Find out what all your options are. "Then she came and told the man of God. And he said, Go, sell the oil, and pay thy debt, and live thou and thy children of the rest" (2 Kings 4:7).
Consumers often find themselves with questions when financial burdens become too heavy to bear. Being unable to meet monthly financial obligations due to job loss, job change, or medical problems, among other reasons may create a situation when bankruptcy advice might be something to seek. Once behind on monthly obligations it may seem almost impossible to catch up again, especially if monthly income has been reduced. Information will include understanding differences between filing Chapter 7 and Chapter 13. One of the common reasons to seek bankruptcy advice might include high credit card debt. Consumers are easily persuaded to get numerous credit cards. In time, the balances grow just as much as the limits. Chapter 7 will usually allow the consumer to write off credit card debt. Advice from legal specialists online will be able to answer most bankruptcy questions you may have.
Personal assets are generally protected under bankruptcy laws. Each state determines the amount of personal property consumer's may keep when filing. Personal assets protected usually include clothes, furniture, appliances, ordinary household goods, and personal effects. Equity in your home and life insurance may also be exempt under the law. Seeking advice will answer bankruptcy questions concerning personal property and exemptions when filing. If the court finds that the consumer filing Chapter 7 may be able to pay debts over a reasonable amount of time then Chapter 13 might be necessary. Legal specialists should be able to determine which Chapter is best for you.
A secured debt may need a reaffirmation of debt between the debtor and creditor. The court will determine if the reaffirmation puts undue burden upon the debtor. A reaffirmation may include a home mortgage or an auto loan. Should you reaffirm debt? Ask your attorney about reaffirming debts when seeking bankruptcy advice. It may depend upon your ability to repay the debt. Reaffirming may not be necessary if the consumer is current on monthly payments with the debtor in question. If the debt is reaffirmed both the creditor and the debtor have to sign a reaffirmation agreement.
Some debts are not dischargeable under Chapter 7. These types of debts might include student loans, alimony, spouse support, and child support. Income taxes may or may not be dischargeable through Chapter 7. It seems to depend upon each consumer's unique situation on whether income taxes can be discharged. Some debts may be discharged through the court based upon hardship provisions. When inquiring, find out if the situation might include hardship provisions.
If you have a home and are trying to stop foreclosure then Chapter 13 would be the best way to file. When seeking bankruptcy advice on foreclosure, a consumer will find that it is necessary to eventually catch up on payments that are behind. The default on the loan has to be cured. Under Chapter 13 the debtor must file a plan on how the debts are going to be repaid. The plan must also include attorney's fees. When seeking legal counsel on Chapter 13, there is a lot to consider based upon individual circumstances. Make a list of questions before seeking bankruptcy advice. Many times questions will lead to more questions. You may find that there are other alternative through research. Sometimes just living on a budget might be all that is needed to catch up on debts.
Additional bankruptcy questions that one might ask are: How will the Chapter 13 or Chapter 7 affect my credit? Bankruptcy on your credit may mean paying higher interest rates for future credit purchases. Usually filing bankruptcy will not prevent one from buying a home within a couple of years after filing. Most creditors want to see that your credit is reestablished and current obligations are being met on a timely basis. Going bankrupt will stay on your credit report for 7 to 10 years. However, once engaged in proceedings, creditors can no longer harass you legally. Legal specialists can put a stop to harassing phone calls, wage garnishment, foreclosure, and lawsuits. Consider other options before filing, though. Seeking counsel is important and finding out other options will help one in making an informed decision. Consider debt consolidation through a credit agency or taking out a home equity loan to pay off debts.
Bankruptcy RulesBankruptcy rules have changed dramatically over the last couple of years. Information on how to file bankruptcy can be found on the Internet in a number of locations. Most important to the bankruptcy court is the honesty of everyone involved with the case. The person seeking these services must reveal all unsecured debt, all assets and their respective values. If the trustee finds that the debtor has not revealed all assets, it could put the debtor in serious trouble. Fines, or even jail time could result.
Anyone can file bankruptcy himself, or can hire an attorney to do the services. If done himself, he will need to be meticulous about filling out the forms and fully understand how to file bankruptcy. When someone else prepares the petition, the debtor is the only person that is able to sign the papers. If the court finds that the preparer did sign for the debtor, it could mean a $500 fine for the person filing. Under the bankruptcy rules, the Trustees in Chapter 7 or Chapter 13 cases are first appointed by the court as interim trustees, then if the creditors' committee does not come up with another candidate they prefer, the court-appointed trustee begins handling the case.
Each individual must first decide which kind will be filed. Bankruptcy rules are different for Chapter 7 and Chapter 13. It is important to remember to include every unsecured debt owed, and list all assets as well under Chapter 7. Each state has specific bankruptcy rules about exempt assets, but usually a home, furnishings, car, and business tools are exempt. Any other possessions, from artwork to xylophones, are items the trustee can sell at auction, and then use the funds to pay creditors. If seeking how to file bankruptcy under Chapter 13, the initial procedure is very much the same as with Chapter 7 except that no assets are sold. Instead, plan for paying off creditors over three or five years is put into place. Payments are made until the end of that period, and any debts remaining unpaid at that time are discharged.
Everyone from the debtor to the trustee and the creditors has a role to play that is specifically defined, so when researching how to file bankruptcy it is important to fully understand these rules. The bankruptcy rules state that creditors cannot harass the filer after filing. Creditors can have some influence on the case if they form a committee and appoint someone they know and trust to be trustee, but that's as much as can happen. After that the creditors must then wait for the court to decide how much they will get. The filer has an obligation to be honest with his presentation of what was owed so that no one is cheated, and the Trustee must carry out the provisions of the Chapter that is being filed.
Regardless of the relief, it is far better if inquiring about such actions never has to take place. Rules are in place to keep everyone honest so the best results are achieved. However, there are drawbacks. Some of those which should be remembered are these: (1) A bad credit rating that makes it harder to ever borrow again; (2) having to appear in court; (3) lose assets when creditors sell property, like a car or house; (4) garnishment-- up to 10% to pay creditors. "For God hath not given us the spirit of fear; but of power, and of love, and of a sound mind" (2 Timothy 1:7) It is important to know that ALL money is God's. If a person lives with this thought in their mind, money management and the respect of income gained will create a better life and frame of mind.
Don't believe someone if they say that filing more than once is impossible. The second time the rules change some, but can be done. Tarnishment stays on credit reports for ten years, but some lenders work with the situation anyway. This may cause a higher charge in interest rate than someone who has not filed. There seems to be more willingness to deal with people who have filed under Chapter 13 than those who filed under Chapter 7.
When deciding how to file bankruptcy, remember that the rules do not allow the trustee to seize all assets and sell them to cover the debts. He only has access to non-exempt assets. When making the final decision know how important to look at the whole picture. Knowing personal boundaries and ultimate goals is crucial to focus on in order to not get into further trouble. If there is any doubt about what decision to make concerning financial issues that are important to contact a professional as soon as possible. Be patient and wise in whatever decision is made.