How To File Bankruptcy: As Easy As A-B-C

2007-03-08 10:33:40

( Financial )



There are relatively easy procedures on how to file bankruptcy. Bankruptcy keeps you away from non-stop, aggressive creditors. When you are considered bankrupt by the law, it will be easier for you to handle the situation, rather than having more and more debts pile up.

In your quest for bankruptcy filing, make sure that you know the consequences that bankruptcy will bring about, and before signing any forms to formally acknowledge you as bankrupt, make sure that you know what you are getting into. Although there may be traps that you will find while you are bankrupt, getting through the whole thing leaves you with a clean slate and restart debt-free.

How to file bankruptcy is pretty much easy, and is often taken into effect immediately. Once you’ve analyzed that you are over your head in debt, look for a bankruptcy lawyer with a good reputation. This is very vital because the lawyer will be responsible for protecting your name, including the names of those who are consignors or joint account holders, and eventually will improve your record for credit rating. Take along your financial statements, outstanding bills, bank statements, and the most recent income verification documents. How to file bankruptcy is as easy as A-B-C, as long as you follow all the rules. When consulting a lawyer, make sure that you report all of your debt and don’t leave anything out. You will eventually have to pay for it after the court proceedings are complete. The next step on how to file bankruptcy is to determine your secured debts from the unsecured ones. Your secured debts are those wherein the companies hold collateral against you if you do not fulfill your payment. Unsecured debts are those that don’t require collateral. You should report all you income statements so you wouldn’t be accused of withholding income and assets, a crime that could put you in graver danger. One important thing in bankruptcy filing is choosing what kind of bankruptcy fits your situation. If you have a regular and stable income, you may opt for Chapter 13, which enables you to pay your debts within a certain time period, and eventually keeps you away from foreclosure or repossession. If you opt otherwise, you may choose Chapter 7 and go through the repossession of your declared collateral. The next step on how to file bankruptcy is to have your attorney legalize the petition at the county clerk’s office. Immediately thereafter, notify your creditors that you have filed bankruptcy. Once done, you should be in contact with the corresponding bankruptcy trustee, who collects, sells, and distributes the sale of your asset if you opt for Chapter 7. If you opt for Chapter 13, the trustee is the one that collects your payment and distributes it to the creditors. Lastly, you should attend a meeting of your lawyer and the debtors so that you can first handedly experience the announcement of your discharge of indebtedness.


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