Medical bills, credit card debts and unsecured loans often lead an individual into a debt situation which can spiral out of control. it will lead one to explore how to file bankruptcy. If one is accepted to be bankrupt it can lead to relief as creditors and debt collection agency are stopped in each case. The bankruptcy process is governed by strict federal laws, which are reviewed. There are procedures one must follow for filing for bankruptcy.Overall there are benefits and drawbacks.Bankruptcy will feature on your credit rating for at least ten years and as a result of this action some creditors will not help you in the future. To file for bankruptcy should not be one’s first option.
There are different types of bankruptcy codes. The first is the chapter 7 bankruptcy code. In this process the assets of the debtor is taken over by a trustee who liquidates those assets to pay the creditors. Some types of assets can be kept by the debtor; however debts like spouse and child support as well as some types of taxes and loans are not discharged. Chapter 9 bankruptcy code is applicable to municipalities of towns and cities. Chapter 11 bankruptcy process is used mainly by commercial entities. They are allowed to reorganize in such a way that they can pay their debts and still continue in the business. The bankruptcy court may allow the company to withdraw from some obligations and contracts.
The most important function of these bankruptcy rules is to determine who is really in need of a chapter 7 filing. Your creditors would much rather see you enter into a chapter 13 filing, so that the entire debt will not necessarily be discharged, and your payments rescheduled instead. This is an area where a lawyer can be helpful. You’ll need to make the case that a chapter 7 filing is the only way you can recover from your major financial problems.
Bankruptcy is a legal process by which firms or entities eliminate the obligation of payment of a debt to creditors with the protection of a bankruptcy court. The entity can take their desired time to repay some of its loans to its creditors. Bankruptcy is categorized into two major groups. Liquidation which is also known as the chapter 7 bankruptcy, and reorganization also referred to as chapter 13 bankruptcy are the two types of bankruptcy.
The next step is to hire a bankrupcy solutions bankruptcy attorney. In fact, the bankruptcy laws are very complicated ones and it is not easy for a common man to understand the intricacies involved in the same. Therefore, it is important that you hire a bankruptcy attorney to handle your specific bankruptcy case. You must shop around for the best bankruptcy lawyers. Do your research thoroughly. You should also note that the bankruptcy laws are interpreted in various states in various ways. Therefore, make sure that the bankruptcy attorney you have chosen is specialized in the specific bankruptcy laws of your state.
While Florida Bankruptcy means test may be a helpful test, it is also important to remember that it is a complex test. Therefore, it is advisable to hire a lawyer who knows his job well and who can carry out his role competently. When you have a capable and reliable lawyer by your side to represent and defend you, half the battle would have been won already!
Filing for Chapter 7 bankruptcy can be done by an individual or a business. This process takes about three to six months to complete depending on state’s legal process and the bankruptcy court’s workload.