Filing for bankruptcy can be quite confusing. It is a very serious legal matter that should only be done with proper representation from a bankruptcy attorney. Here are some things to take into consideration as you take the first steps towards financial freedom.
Bankruptcy is a legal proceeding that puts you in front of a judge where you explain that you can no longer financially afford to pay your debts. The judge will work with trustees to look into your assets and liabilities to decide if the debt should be discharged or there are means to repay a portion or all of it. If the court concludes that you cannot payback these debts, they will declare you bankrupt.
Although bankruptcy can stop foreclosure, repossession, and garnishment of wages it doesn’t cancel all of your debts. Bankruptcy does not clear:
- Student loans
- Government debt: taxes, late fees, and penalties
- Child support
- Alimony
- Expenses purchased right before declaring bankruptcy
There are many types of bankruptcy that can be filed both consumer and commercial. The most common consumer bankruptcies files are Chapter 13 and Chapter 7.
In chapter 13 bankruptcy the court will approve a plan for you to repay some or all of your debt over the span of three to five years. You will keep all of your assets and follow a strict timeline and monthly payment schedule set forth by the court.
In chapter 7 bankruptcy the court will decide what reasonable assets are vs “luxury” items. Things will be sold to pay off debt if they are deemed over and above what is reasonable. Once you have paid back as much as is thought to be reasonable the remaining unpaid debt will be erased.
Bohikian Law Group specializes in bankruptcy services including chapter 7 and 13 bankruptcy. More information can be found at https://bohikianlaw.com.
No comments:
Post a Comment