A Simple Guide About What Happens When You File for Bankruptcy
Whereas the process of applying for some loan can be as simple as meeting the qualifications, situations may arise when you are not able to pay the loans back. One area of concern once you realize you are bot able to settle all the debts is the next step that is best for you. 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. You should have it from the beginning that bankruptcy is a legal process and all the proceedings are held in coulearn, you will get to learn more about some key things that you need to know about bankruptcy.
To begin with, you need to know how it all happens in court. The decision about bankruptcy is made in court and this is through a judge and an independent contractor who is hired for this service. Both the judge and the trustee are the ones to review information to discover whether you are worth bankruptcy 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. Some of the bankruptcy types are chapter 11, chapter 12 and chapter 13 whereas chapter 7 is the most common. You should also know that chapter 12 is occupation-based occupation-based as explained on this page. As you view here now, you will also discover more than chapter 7 forgives a lot of debts that have no collateral and it also incurs the risk of selling some of the important property that you may own to pay part of the debt.
Bankruptcy filing is both a long and expensive task. Remember you will have to meet the credit counselor for bankruptcy and debt as well as putting all the relevant information in place for the process. Be prompt to show the court that you made efforts in ensuring that everything is settled.
You also need to know that normally there are plans to have a look at your financial situation as arranged by the court. The key participants in looking at your financial statements are the lawyer, the trustee and the creditor. It is, however, important to note that this process is not a one-day event and could take as long as several months before any approvals are made. Above are the important things to know when filing for bankruptcy.
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