By Kaitlin LanierBankruptcy can be a hard pill to shallow. However, especially in a recession, it may be a necessary step because there are no other alternatives. Therefore, if bankruptcy becomes the only choice, the person who decides to file should know exactly how to file. Being prepared and educated can be half the battle. Thus, these are the easiest and least painful tips if filing for bankruptcy becomes the solution:
First of all, one should keep in mind that filing for bankruptcy is a legal process. Therefore, doing research and being well-informed can help before the process even starts. It allows for such a person to make an educated decision on whether or not to do the bankruptcy process alone or with professional help. It is quite possible to complete the process alone, but it would be time consuming and require a lot of patience.
If one decides to go about the process alone, he or she must decide to file Chapter 7 Bankruptcy or Chapter 13 Bankruptcy. The most popular is Chapter 7, which is a straight or liquidation bankruptcy, but the BAPCPA has made it more difficult to file a Chapter 7 case because of the means test. Because of this test, many individuals will be forced to file a Chapter 13 case, which is a repayment plan for individuals. Either way, make sure to do research and understand which case suits specific needs before deciding and filing.
On the other hand, it might be easier to hire a bankruptcy lawyer to help guide an individual through the entire process. Such a person will need to provide the lawyer with all of his or her personal information in order for the lawyer to put together and file the petition. Once the documents are filed, the individual will be assigned a trustee that will make sure all the necessary information is collected and accurate.
From then on, whether an individual had decided to hire a lawyer or not, he or she must notify all creditors that he or she is filing for bankruptcy so the creditors will stop all actions they might be taking to make sure they receive their payments. Later procedures might include meeting with all parties involved in an individual’s case, meeting with creditors, or even meeting with creditors’ lawyers. Bankruptcy filing is a long process and should be carefully considered before deciding upon.
Sources:
Filing Bankruptcy: The Bankruptcy Process by BankruptcyHome.com
Filing for Bankruptcy Online by FilingforBankruptcyOnline.com
How to File Bankruptcy in the United States by wikiHow
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