Essential Things You Should Know About Filing for Bankruptcy
However simple it may be to get some loans from a bank or any other lender, the truth is that certain conditions may make you find it very hard to pay back the debt. The biggest that disturbs most people or businesses that are already bankrupt is the next step to take. Most people and even businesses may never like the discussion about bankruptcy but now that it has already hit some people, you must know some key things about this big threat. One of the key things that you need to note is that bankruptcy is a legal process meaning that everything is decided in court and it involves both the lender and the debtor.
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. Whereas chapter 7 is the most common type of bankruptcy, we also have others like chapter 11, chapter 12 and chapter 13. You should also know that chapter 12 is occupation-based occupation-based as explained on this page. 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.
You should always consider this task demanding when it comes to the time as well as expenses. One of the things that you must always be ready for is to meet the credit counselor for bankruptcy and debt and also assembling all the important information for the process. Always try to show the court that you have tried all that you could to settle the situation.
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. You should, however, have it that the process takes several days or even months and in some cases could go as long as 6 months. Above are the important things to know when filing for bankruptcy.