If you feel that your back is against the wall, and you’ve decided that bankruptcy is the only way out of the debt you have incurred, the next step should be to contact a bankruptcy lawyer for consultation. He can assess your position, and advise you if indeed, filing for bankruptcy is the best solution for your circumstances. But if, for instance, you are deemed “judgement proof,” which means that you have no assets that your creditors may legally lay claim to, there is no need to file bankruptcy.
When, and if you do decide to file, your attorney will explain that there are more choices to be made. You will have to find the right category to fit your situation. Chapter 7 bankruptcy will put you at risk for losing any property that you may own, but it is the fastest way to become debt free. Chapter 13 on the other hand, calls for a debtor to work out a payment plan, based on his income, and it is a longer process. You will have to meet certain eligibility requirements in order to qualify for either option.
What kind of debt do you have? There are some debts that will not be forgiven under any bankruptcy, including child support, alimony payments, or back taxes. If any of these debts apply, filing for bankruptcy will do you no good.
Some types of property are exempt, according to the rules of chapter 7 bankruptcy, but if you have used a personal possession, like a car, or a vacation home, as collateral for a loan, it secures the loan, and your property may be forfeited, even if it would be exempt otherwise.
Credit card debt may be forgiven under bankruptcy, but if the court finds that the debtor has over extended his limit, or if he wasn’t honest about the information he provided on his application for the card, the debt will not be considered in the judgement.
Learn the basics about bankruptcy before you jump into it. Contact an attorney from Parker Lawyers to help you sort through your alternatives, so that you can make the right decision. Call the office @ 303-841-9525.