There is a certain appeal to bankruptcy. By the time you have
reached the point in which you are considering bankruptcy you have
endured countless hours of harassing phone calls from debt collectors
and have spent many sleepless nights stressing about making minimum
payments. The idea that you could move forward into a financial future
that is wiped completely debt free or with a detailed court ordered
repayment plan is tempting. This is especially true when faced with an
overwhelming debt and little means to pay the funds back.
Bankruptcy is of course more complicated than running a few numbers.
There are some long lasting affects that should be taken into
consideration before filing for either Chapter 7 or Chapter 13 bankruptcy. The impact that bankruptcy has on your credit lingers and impacts a variety of aspects within your life.
Not only does bankruptcy wipe most of your debts away it also makes
it difficult to establish yourself financially for years to come. It
will be difficult to open new credit accounts, buy or rent a home, find a
company for insurance, get a cell phone and even possibly impact your
employment. In fact most bankruptcy attorneys will tell you that
bankruptcy should be considered as a final, extreme method to resolving
your financial issue, only considered after trying other budgeting,
credit counseling and financial efforts to remedy the situation.
In order to begin the bankruptcy process it is recommended that you
seek counsel from an experienced, reputable attorney that specializes in
bankruptcy cases. In order to seek relief from bankruptcy you must
first take a step towards credit counseling from a government approved
organization. This must have occurred within six months of filing. A
means test will be performed to confirm that your income does not exceed
an amount specified by the state.
After this is accomplished, with help from your bankruptcy attorney
you will properly fill out the forms applicable to your bankruptcy
situation. An attorney should be present with you throughout all
proceedings going forth.
The type of bankruptcy in which you choose to file for will be
directly related to your situation including the assets and property you
own, including your home, your income and several other factors. Those
debtors with a consistent income are encouraged to look into filing
Chapter 13 bankruptcy over Chapter 7.
Chapter 13 allows individuals with a consistent income to keep their
homes and cars which may be lost under a Chapter 7 bankruptcy. With
Chapter 13 bankruptcy the bank will create a repayment plan to allow you
to hold on to certain property. You must repay certain debts such as
outstanding child support, student loans, taxes and other debts that are
specified by the court.
Chapter 7 bankruptcy essentially allows you discharge most all of
your debts. Property of value is collected and then sold off. A
trustee of the court will take the funds raised and split them
accordingly to creditors. Certain debts may not be written off such as
child support, spousal support, student loans and such.
If you are considering bankruptcy the first step you should take is
to meet with legal representation. They will offer you advice on how to
proceed including those items that can hinder your ability to receive a
discharge of your debt through bankruptcy.
Bohikian Law Group specializes in chapter 7 and chapter 13 bankruptcies in Michigan. Contact us today to find a bankruptcy attorney that will help you in debt relief at http://www.bohikianlaw.com/ today.
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